Provider of a modern database for enterprise applications, Couchbase released the results of research about the organizations’ cloud spending. The research shows that factors like inflexible pricing plans, management tools that don’t give the level of control users need, and data not being stored where it needs to be are causing organizations to pay 35% more to their enterprise cloud costs.
$8.75 million of $33 million could be saved
Couchbase states that an organization that spends over $33 million annually on cloud services could have saved or spent $8.75 million elsewhere if the factors that cause overspending could be eliminated. The survey of 650 senior IT decision-makers found:
- Cloud services are not meeting expectations, and are adding to complication and cost: More than one-third (36%) of enterprises said cloud services adopted in the last three years had not met expectations, while 56% said past cloud decisions had made digital transformation projects more difficult in 2021, and 48% more expensive.
- Contributors to overspending: The factors adding to costs included not having enough insight into spending or ways to optimize costs; the need to improve security and compliance functionality; inflexible pricing plans that don’t give enterprises what they need in a single package; management tools that don’t give the control needed; data not being stored where needed to meet regulatory or performance requirements; and vendor lock-in, meaning enterprises cannot use the specific cloud infrastructure they want.
- Enterprises are struggling against service limitations: 61% of enterprises have had to restrict their digital transformation ambitions because of challenges with cloud services; while 58% have chosen cloud services that did not give the ability to scale the business to meet demand.
- Cloud momentum is unstoppable: 95% of enterprises said that increased movement of infrastructure to the cloud is “inevitable.”
Enterprises are optimistic about the cloud, despite the challenges. Almost every respondent stated that their cloud services are meeting their security, availability, performance, cost-effectiveness, control, scalability, and compliance needs. Organizations also said that 58% of their IT spend is in the public cloud and said that they are currently more than halfway toward that goal. Organizations’ most common concerns around new cloud infrastructure are the security of data (43%), managing data in the cloud (33%), future-proofing to meet future digital needs (31%), and keeping costs under control (%30). Ravi Mayuram, chief technology officer of Couchbase said,
« There’s no denying the impact of the cloud, from giving large enterprises increased scalability and agility, to giving smaller enterprises access to services and applications they could never implement in-house. Businesses believe they are getting what they need, or else we wouldn’t be seeing this seemingly unstoppable momentum. The question is whether they could be getting even more, $8.75 million is too much to just be a cost of doing business. If enterprises raise their expectations and service providers address inefficiencies, they could open up new opportunities for digital transformation, or simply reduce their costs.
If costs and concerns keep mounting, we will see more organizations struggling to meet their overall business ambitions. The key to a lot of these concerns, and the additional costs enterprises are facing, is sprawl. The more control cloud customers have over their data, including where it is stored and how it is managed, the more confident they will be that it is secure, that their services are future-proofed, and that they have costs under control. We know there’s no putting the cloud genie back in the bottle, and nor should enterprises want to. Instead, we need to ensure it lives up to every expectation. »