Cloud Hosted Infrastructure’s Value

By Chris Davis, CTO

We have a client that refreshes their infrastructure every three years and puts it into a lease.  They are also considering centralizing the main application to one of the offices.  In order to make this happen, they will need to purchase new servers, storage, and a higher speed Internet circuit (with a three-year contract). 

The ROI on IaaS is not linear.  Let’s say we could provide all of the infrastructure necessary to host all current applications in a Private IaaS provider.  For this example, we will say they would need to pay $2,500 per month.  In turn, after three years they would pay $90,000.  If they purchased or leased new hardware and software, then they mostly would need to spend $60,000 in hardware and labor costs.  Not to mention whatever their new high bandwidth circuit will cost per month.  Many people think this is a no brainer, buy the hardware as it has a better ROI over the three years.

This is the misconception that challenges cloud adoption.  First, let’s look at what the purchase of the hardware is lacking. 

The business must ask these questions:

  • What happens to the server when the power goes out?
  • What happens to the application that is on the server if the Internet goes down?
  • How often is the server backed up? 
  • How long will the server be down if it becomes corrupt? 
  • How long will the server be down if the hardware failed?
  • What happens if the office has an extended outage due to acts of God?

If the business is comfortable with downtime and uncertainty, then they may settle for hardware on premise. But when the business puts their infrastructure in the cloud, then all of these questions are answered.

  • What happens to the server when the power goes out? – The data center has uninterrupted power supplies (UPS) and generators to run during long power outages.
  • What happens to the application that is on the server if the Internet goes down? – The data center providers Internet with multiples paths via different carriers.
  • How often is the server backed up?  - The server and all its data are backed up 6 times a day or more.
  • How long will the server be down if it becomes corrupt? - Entire servers can be restored within 15 to 30 minutes.
  • How long will the server be down if the hardware failed? – Servers are running on redundant hardware.
  • What happens if the office has an extended outage due to acts of God? – All servers can be failed over to a secondary data center in a different geographical location.

So what happens at the end of that three-year contract?  When you purchase your hardware, then the process starts all over again.  When hosted in the cloud, there is no hardware recycle.  The provider is upgrading hardware through the life of the service.  Now the business has to decide if the reliability, stability, performance and no more infrastructure refresh is worth the additional money.

If you want to get your company off the technology life-cycle treadmill and migrate to an integrated suite of cloud-based platforms, let ION247 help you CONNECT-IT!