Cloud Transformation Insights: Accurate Cost Estimation

Cloud Transformation Insights-1
Cloud Transformation Insights-1-1

Cloud Transformation Insights: Accurate Cost Estimation. Currently, all growing businesses are dealing with transitions from on-premises infrastructures to multi-cloud, hybrid cloud, or both. From a strategic perspective, the decisions made referring to this significant technology shift will impact your company for the next decade.

Whether you are looking to move one workload or shutdown an entire data center, the transformation is complex and brings in many difficult decisions that influence key company processes. Successful cloud migration must rely on an in-depth analysis and high-level expertise.

In this review we answer some of the most important questions that our clients have asked during their cloud journey.

One of the biggest challenges is to estimate the costs of working and maintaining cloud infrastructures and services. There are several factors which influence the overall costs of the cloud, including:



It’s the first thing which needs to be taken into consideration when estimating the costs. It is relatively easy to calculate, but there are a few things that must be highlighted. Different storage classes are possible. Hot storage and archive are the most popular (naming can vary depending on the cloud vendors). Hot storage is more expensive, but it has performance advantages. Firstly, access to the files is quicker and can be set up for data which is frequently accessed.

The archive should be used for storing data which is not used frequently and as a backup storage. An additional, important factor to consider are the transactional costs. Every read, write, and metadata operation generates operational charges. In some cases, such as big data workloads and high-volume analytics, these can be a major cost driving factor. We are familiar with high transactional cost problems and have implemented optimizations and monitoring policies to remedy these situations.



There is a potential cost when moving data to the cloud. Both ingress and egress traffic can be billable, depending on the exact scenario (cross-region replication).


VPN access

In order to connect local infrastructure with the cloud infrastructure in a secure manner, it is required to deploy a VPN endpoint or to establish a private connection for more demanding scenarios. It may be recommended to deploy both, to mitigate the risk of failure of private connectivity.


Machine types

Each of the cloud vendors provides specific machine types which can be used. These are billed based on the size (RAM, CPU), attached disks (frequently SSD or NVMe disk can significantly impact VM cost), and the amount of time that the VM is running. (Typically, specified timeframes are charged immediately, and then charges per used seconds are applied.) Depending on the requirements, it is advised to check each cloud provider’s pricing policies to ensure that they are in line with the planned workload resource utilization characteristics.


Managed services

Cloud vendors provide the ability to perform the deployment of various PaaS services (including databases, computing engines etc.) based on their portfolio. They provide SLA for the infrastructure under which the PaaS is working. However, they charge an additional fee for maintaining it.

There are many more additional fees which you can come across when using cloud computing. Usually, cloud vendors provide an online calculator, but it is intended only for a general overview.

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