Cloud Wastes And How To Avoid It: Poor Cloud Utilisation
In our previous post, we’d established what cloud wastes are, and began by discussing the major source of cloud waste: idle resources. Idle resources are predicted to cost an estimated $14.5B this year already —I know, that’s a lot of waste! And there’s another type of cloud waste about to give idle resources a run for its money – poor cloud utilisation!
But before we jump into what poor cloud utilisation is, although it seems already self explanatory, let’s just lay the groundwork again for first time readers on what cloud waste is.
In AWS reInvent 2019, it was reported that among enterprise users, 35% of their annual cloud spend was waste, amounting to over $10 billion. Cloud wastes are money being paid to your CSP for cloud resources and services that are not being used.
According to Gartner, “Worldwide end-user spending on public cloud services is forecast to grow 20.4% in 2022 to total $494.7 billion, up from $410.9 billion in 2021, according to the latest forecast from Gartner, Inc. In 2023, end-user spending is expected to reach nearly $600 billion”. While approximately 82% of organisations say that implementing cloud systems turned out to be more expensive than initially thought. Organisations have also indicated their public cloud spend was over budget by an average of 13%.
As I mentioned before, cloud waste goes against the fundamental purpose of cloud computing — the pay-as-you-go model. Cloud computing is supposed to eliminate, if not completely, up to 95% your IT infrastructure waste; giving you the opportunity to pay only for computing or storage services you need to run your business—completely taking away any extra procurement or underutilised IT costs—hence the term, on-demand computing!
Organisations, however, have found this very difficult to achieve. It’s almost as if cloud computing is yet another IT fad set to come and go. But I can definitely tell you that cloud computing has come to stay! There are a few, however, who have embraced the pay-as-you-go cloud computing model and have reduced their IT infrastructure wastes to the bare minimum, and these are some of the practices that we aim to share in this cloud waste series.
Poor Cloud Utilisation
Poor cloud utilisation happens when cloud resources larger than the size needed is being used, hence, overprovisioned resources. Kind of like purchasing a supercomputer to solve a simple maths problem. Will it solve the maths problem? Yes! But can a simple, standalone calculator also solve this maths problem? Yes! So why purchase a supercomputer? Overprovisioned resource.
An estimated $8.7 billion is wasted due to overprovisioning and poor cloud utilisation. About 40% of instances are at least one size larger than needed for their workloads, and these cloud costs can be cut in half by reducing an instance by one size, and up to 75% can be saved by reducing an instance by two sizes.
Avoiding Poor Cloud Utilisation
What are organisations doing in order to reduce this cloud waste, and rightsize cloud resources to the workloads needed?
According to Flexera, organisations are adopting FinOps either manually, through a Managed Service Provider (MSP) like CloudPlexo, or automatically, through FinOps SaaS solutions such as Wendu to assist their DevOps or Cloud teams. FinOps gives you insight into the utilisation of your cloud resources, and lets you know when resources are being either idle or under utilised.
Wendu and FinOps
SaaS tools such as Wendu gives both technical and non technical managers the ability to identify both idle and under utilised resources, and make cost saving decisions quickly to avoid cloud spend wastes.
Wendu also gives you EC2 instance optimization opportunities, called Recommendations, and calculates an estimated monthly savings by acting on these recommendations offered to your cloud management team.
Without visibility of the utilisation of your cloud resources, it will be virtually impossible to avoid this cloud waste. Learn more about Wendu here, and you can also request a demo to see how using Wendu can help your organisation save up to 70% in cloud wastes annually.