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Cloud service ROI: 10 key considerations for small business

One of the biggest questions facing decision-makers today is whether to continue investing in IT infrastructure or start migrating to cloud services. The following are 10 key factors that, in addition to capital expenditure, should be considered by small business leaders when making a cloud ROI calculation.

Takeaway: "Doing IT Yourself" is much more expensive than you might think.

1. Time to implementation

Traditional IT procurement consists of considerable lead time for financing, hardware, power, and/or space provisioning. A typical implementation cycle from decision to production is easily two to three months, resulting in lost opportunities or service degradation.

2. Cost of implementation

Traditionally, once hardware is received there are still numerous expensive tasks prior to reaching production:

* Acquiring new space and power

* Physical installation of servers, switches, storage, and cabling

* Prepping and testing the hardware, including burn-in

* Integrating the new hardware into the existing control infrastructure

3. Hardware maintenance

Hardware maintenance contracts are roughly 20 percent of purchase price per year. Contracts can be avoided by lowering expectations of availability or by purchasing additional hardware (spares), but this too can be risky and expensive.

4. Software licensing and maintenance

Virtualization software licensing is a considerable portion of the upfront costs -- and usually only covers basic items. Support for these licenses, which provides access to troubleshooting, patches, and new features, typically runs at about 20 percent or more of the purchase price -- every year.

5. Redundancy

For production environments, a high degree of redundancy is expected, including all levels of the platform from internal and external connectivity to orchestration and the automatic recovery of hosts after a failure. Such redundancy can be very expensive -- and it adds to the labor required.

6. Feature set

Taking advantage of the full features and benefits of virtualization software requires additional costs and the management of a more complex platform. Some technologies are built into the hardware platform (e.g., snapshots) but can be very expensive to implement and maintain.

7. Scalability

Additional workloads -- either unexpected or derived from organic growth -- can be problematic with a fixed set of resources. The inability to meet these needs may result in lost opportunities or over-purchasing of resources to meet production demand (and under-utilization in non-peak periods).

8. Reliability

In order to maintain consistent performance and uptime, resources and procedures are required to operate, patch, and support the platform. This may require additional personnel, training, or third-party support contracts -- which means more overhead.

9. Performance

By optimizing performance one can often meet production requirements with fewer hardware resources. Better performance typically requires the purchase of expensive technology that must be configured correctly, adding to costs and complexity.

10. Expertise

Building and operating an in-house cloud environment requires a high level of expertise. Skill sets must be obtained through training and/ or experience, and can be a distraction from the enterprise’s primary business objectives.

Bottom line

Net net, the operational and financial reasons for migrating a cloud service provider such as AIS are quite compelling -- because the "traditional way" of procuring, provisioning, delivering, and managing in-house IT services is EXPENSIVE.

AIS has a staff of seasoned professionals who are trained and experienced in advanced cloud technologies. This is what we do -- so that you can focus on your core business.


Submitted by AIS, (866) 971-2656, www.americanis.net

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American Internet Services

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American Internet Services Executive(s):

Tim Caulfield

  • Chief Executive Officer

Kevin O'Hare

  • Chief Financial Officer

Steve Wallace

  • Chief Technology Officer

Greg Rollet

  • Chief Executive Officer

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