It can happen for a number of reasons and Staten says one of the most common is that IT professionals just aren't thinking about the cloud in the right way. Developers and other end users usually ask for more resources than they need so that they don't have to "go back to the well asking for more," Staten says. It requires a "mind-shift" to think small and scale up, he says.
The issue is complicated by the numerous offerings and prices for cloud services in the market, Wagner says. Cloud vendors offer customers a range of options at different prices when purchasing cloud services.
For example, industry-leading Amazon Web Service's popular Elastic Cloud Compute (EC2) has four versions of on-demand instances to choose from. They range in price from $0.15 per hour for a small instance that provides 1.7GB of memory, a single EC2 compute unit, and 160GB of instant storage, all the way up to the extra-large version, which is $1.20 per hour and provides 15GB of memory, eight EC2 compute units and 1,600GB of instant storage. There are midsize and large offerings falling in between. Beyond that, there are offerings for high-memory on demand and high-CPU offerings, each which have different sizes of compute power as well. Or, customers can choose to purchase reserved instances, which are paid for on an annual basis instead of being metered on an hourly rate. Meanwhile, AWS recently announced its 19th price decrease in the past six years, and Windows Azure and Google dropped their prices as well.
"We're talking about a very chaotic and volatile market," Wagner says. That, he says, leads to customers misunderstanding their actual costs and cloud consumption.
So just how is an enterprise to know which resources to get? Each business's situation is different but Wagner says generally if a business's service is up and running in the cloud for more than 40 percent of a year, then a reserved instance is likely a more efficient option than on-demand. The key, he says, is to have clear visibility into an enterprise's compute power and cloud usage, which Cloudyn and other cloud services providers offer applications in. Cloudyn's SaaS application tracks an enterprise's computing usage and its cloud purchases. Other services providers in the area include Uptime Software, Newvem and Cloud Cruiser.
Staten says cloud monitoring and provision analysis tools are an emerging field that he expects to become more competitive in future years as cloud adoption continues to increase. "As the economics of cloud platforms becomes more well understood we will see more demand for these types of tools and I would expect to see cost trackers added to traditional management tools," he says.
This article originally appeared at NetworkWorld.com. Network World staff writer Brandon Butler covers cloud computing and social media. He can be reached at BButler@nww.com and found on Twitter at @BButlerNWW.