Companies to waste $10bn over 12 months on cloud spending

By Jonathan Dyble
As more and more firms look to access cloud services in order to digitise their operations, a new report from cloud management expert RightScale has sug...

As more and more firms look to access cloud services in order to digitise their operations, a new report from cloud management expert RightScale has suggested that inefficiencies within this could lead to a significant amount of money being wasted.

It is becoming increasingly imperative and demanding that firms transform in this way in order to remain competitive. However, RightScale estimates that as a result of cloud users not understanding how to minimise costs in this venture, an average of 35% of cloud spending budgets are wasted.

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“Cloud providers claim they are getting better at helping companies reduce some of their cloud spending. For example, Amazon Web Services (AWS) recently claimed it saved AWS users $500mn by alerting customers when they were overpaying,” said Kim Weins, VP of Cloud Cost Strategy at RightScale.

“Unfortunately, this is just a drop in the bucket. RightScale has seen that companies waste, on average, 35% of their cloud spend.

“This equates to $6.4bn in annualised wasted cost for AWS alone. For the top three public cloud providers (AWS, Microsoft Azure, and Google Cloud Platform), this represents annualised waste of $10bn.”

RightScale highlights complexities in cloud pricing, a constant change between cloud providers and the decentralised adoption of cloud as three key reasons behind this wasted expenditure.

For more, read the full report from RightScale.

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