Price vs. Service – What Will Win the Cloud War?

Posted on August 15, 2014 by Paul Diamond

For companies that haven’t yet dabbled in the cloud, the types and options seem endless and in some cases, intimidating. Where to even start when choosing what’s best for your company? What’s worse – if you’ve been keeping up with the IT industry buzz on the topic, you know that vendors, analysts and pundits have been touting the best cloud computing solutions and strategies for years. The reasons for why specific solutions and strategies rise to become considered the “best” are for various motives and factors, and often times, pertain to specific infrastructure scenarios. Within industry coverage and articles that debate these cloud computing solutions and strategies, you will often read the comparison described as the “cloud war.”

So, what are the main factors driving the “cloud war?” To date, the industry and end users seem to care most about either the cost or the services associated with cloud offerings. So lets break down what this means and why it’s important:

Cloud Price War: By leveraging the ability to scale cloud offerings, a price war has erupted with vendors. Tech advancements and purchasing volume continues to drive prices down, and there is a constant battle for the lowest price for cloud storage. But the main difference lays in customer subset requirements. Amazon and Google might be battling it out over price, but their reliability and redundancy is slim. For enterprise-class data and cloud storage needs, specialists and smaller providers play in the same sandbox with these bigger players in that their costs are indeed competitive, but that they are also going above and beyond trying to be the absolute cheapest, and instead focus on providing a service. If obtaining the cheapest cloud storage was the main goal for customers, they would constantly be moving data and changing up their cloud provider since it’s a moving target between the vendors. And let’s be honest, that amount of changeover in the infrastructure can be exhausting and ineffective.

Cloud Service War: Here’s where it get’s interesting, and where customers have to pay attention. Cost is easy to determine based on budget and manageable growth/scale expectations. But for services, you must truly know your data and what you require from your vendor. We discussed categorizing your levels of cloud data in the past – how critical is this data, do you have to access it frequently, will you move it frequently, what are your disaster recovery requirements, and so on. Other factors come into place, too – performance, SLAs, capacity, connectivity, and compatibility, for instance, is something we see end-users grappling with as their data is placed in separate clouds and they don’t work well together.

A recent article in eWEEK compared these cloud price cuts to the gasoline and airline industries, in regards to how it all will affect service – as costs go down, service does as well, in some cases potentially rendering the cost benefits obsolete anyways.

It will be interesting to see how it all plays out, but our advice to clients is to not choose entirely based on cost or entirely based on service. Instead, look at your perfect solution from all angles – understand what your company and your data truly needs and work your way backwards to determine the solution that will fit in the short- and long-term. If you would like to speak with a team of professionals about what your perfect cloud solution looks like, we are happy to counsel – contact sales@markleycloud.com or visit www.markleycloud.com.