A recent study from 451 Research reveals some interesting facts about the nature and complexity of cloud pricing. In theory, one of the major benefits of using the cloud is that on-demand pricing makes it easy to know exactly how much a company will be spending and avoid large-scale capital expenditure. That’s certainly true, but the cloud space has yet to develop into a fully mature market, which means that companies have to tangle with wildly different pricing models and the cost itself can vary between vendors. That makes it difficult for companies to discover where they should put their investment in order to generate the best ROI.
As the cloud market matures, pricing structures and cost will naturally align as storage and compute power become more commoditized and vendors compete directly on price and features. This progress will be further fueled by the increasing interoperability of individual cloud services. As companies demand the ability to fluidly move their cloud investment between different vendors, those that make lack of vendor lock-in a feature will out-compete providers that try to keep customers within a walled garden by building their platform with proprietary technologies and APIs.
At the moment though, the cloud platforms provide enormous value, but it’s difficult to determine which combination of providers can offer the best feature / price ratio. That’s why we see the growing popularity of “cloud comparison” sites and cloud marketplaces. A cloud marketplace site allows companies to directly compare the pricing of different cloud vendors.
If a company requires a certain amount of storage in a specific location, without a cloud marketplace site, it would be challenging for them to gather the necessary data to determine where they should put their data. With a cloud marketplace, it’s trivial: they enter what they need and the site will provide them with a list of providers and pricing, enabling them to make a direct comparison.
The problem of cloud pricing is complicated in the case of multi-cloud deployments. The management overhead for discovering and using the best service for different processes can be significant. Cloud marketplace sites allow companies to stitch together products from a multitude of different vendors, directly comparing pricing and features, before building the cloud that perfectly suits their needs.
The report from 451 Research reveals that using the services of cloud marketplaces is essential if businesses are going to make the most of the cloud without expending serious effort on investigating and contracting direct with multiple vendors. We can expect to see cloud marketplaces grow in importance as ever more businesses take advantage of the cost savings the cloud can bring.