Digital businesses have a new mandate to streamline operational spending. One of the most significant cost-centers for businesses is cloud compute. Organizations are rethinking the workloads they’re deploying and where in order to better understand how to eliminate unnecessary costs.
The fundamental truth is that the economic model of sole-sourcing cloud compute on a hyperscaler that’s not optimized for all businesses is broken. This was best captured by David Hansson, who highlighted the massive cost savings that his digital business could secure by moving workloads off AWS back into a wholly-owned and managed data center.
This isn’t a limited phenomenon, as a growing list of companies have announced their intentions to take a similar approach. Snap recently explained their decision to cut spend on Google Cloud and AWS.
Gergely Orosz takes a deeper dive in The Pragmatic Engineer. Of the 71 companies surveyed, 90% are working to reduce vendor spend. Where are these cuts being made? Cloud spend is one of the top choices among companies of every size. More than a quarter of early-stage startups plan to cut cloud costs, with 36% of late-stage startups and 30% of publicly traded companies doing the same.
It’s a false choice, however, that digital businesses have to choose between exorbitant costs and surprise bills from a hyperscaler versus the fixed costs and expenses with a data center. What’s missing is the role of the independent cloud.
Independent clouds play an important role in the current environment as a viable, cost-effective alternative that doesn’t sacrifice performance or platform capabilities.
This article in The Next Cloud Platform misses the role of independent clouds. Independent clouds come in four forms: those that specialize in niche workloads, those that specialize in specific regions (compliance/data sovereignty-related), those that are industry-specific, and those that serve as broad-based global alternatives to hyperscalers. Vultr fits into the fourth category. This category is enabled by the rise of co-lo providers and, to a lesser extent, the leasing of space in owned data centers for subscription-based billing and cloud infrastructure and services by an independent cloud.
What’s also missing in this discussion is the rise of infrastructure-as-code. New cloud orchestration platforms are enabling IT to effectively spin up optimized cloud infrastructure and services on-demand from a variety of providers to best fit their workload and budget requirements.
What this means is that the real shift isn't from one specific model to another, but rather a shift in mindset into optimizing cloud spend by region by workload to best meet compliance and ROI requirements.
It's no longer vendor A vs. vendor B. It's whether the customer ultimately wins and gets freedom, choice, and flexibility in their cloud infrastructure, and sees the ROI they intended.
While operational cost reductions are becoming more prevalent in the current business landscape – especially when it comes to cloud compute – the role of independent cloud platforms cannot be ignored. As companies strive to optimize their overall spend, independent cloud offers a viable, cost-effective alternative to the hyperscalers, giving companies freedom, choice, and flexibility in their infrastructure.
Learn more about Vultr’s approach to globally available cloud compute with the best cost-to-performance of any independent cloud.