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IT Cloud Pricing Estimation Research

By Cara CuiuleMay 20, 2020

If you were watching the news about a week ago, you may have heard about Amazon’s lawsuit regarding the $10 billion, 10 year JEDI contract moving forward. This contract is meant to move the entire Department of Defense to the cloud, under one single provider. This would relieve some work of decision makers in the DoD, who in the past have needed to navigate the offerings of multiple providers to determine which company offers the best and most cost-effective cloud services for their agency’s needs.

Other federal agencies are still moving to the cloud due to directives such as the Data Center Optimization Initiative.Commercial companies are also moving much of their work to the cloud and continue to do so: in a survey taken, enterprises were looking to spend about 25% more on public cloud in 2019. However, picking a specific vendor can generate a maze of choices. This is because cloud computing budgets as much as two years in advance of selecting a cloud vendor. In addition, vendor pricing structures and definitions can vary. Cloud prices also change about every year.

Therefore, having a “vendor agnostic” solution to generate estimates early in the budgeting process may be helpful in the cloud acquisition process. Last summer we collected data from what we consider to be the six biggest cloud providers: Amazon, Microsoft, IBM, Oracle, Alibaba, and Google. We were able to find some open source virtual machine pricing data and collected storage data from vendor websites. We collected mostly commercial pricing data, so it is meant for business IT systems.

In the next blog post, we will go into more detail about the models PRICE® Cost Research has developed based on open source data.