Although cloud applications are still relative newcomers in the tech landscape, cloud computing is quickly gain traction. According to a recent Market Search Report, the global cloud computing market is expected to grow to $623.3bn by 2023, at a CAGR of 18% between 2018 and 2023.
Switching to a cloud-based IT setup can provide your enterprise with attractive benefits, including convenience, reliability, security, and scalability of the IT infrastructure. But could cloud migration really save you money? Let’s look at five convincing reasons why shifting to cloud computing could be financially beneficial to your business.
Low to zero upfront cost
Setting up an in-house IT infrastructure like a server system is a massive investment – IT equipment doesn’t come cheap. In such a scenario, you’ll have to purchase the hardware, buy licenses for all the necessary software, and then hire someone to install and set it up. And don’t forget miscellaneous costs such as transportation, shipment, and any additional support systems, because they also add up. You might spread the cost over the lifetime of the system, but the money still has to come from your pocket.
With cloud computing, you don’t have to buy any hardware or software. The cloud host is responsible for providing all the necessary resources for a relatively small subscription fee at the end of the year or month. It’s basically a steal compared to setting up an on-prem IT system.
Reduced labor and maintenance costs
If you have your own servers and computer systems, you are responsible for maintaining, servicing, repairing, and upgrading them. In most cases, this calls for a dedicated in-house IT service or department on standby.
Maintenance of cloud resources and services is provided by the host or a managed service provider. So, you never have to worry about upgrades, repairs, and downtime. This also removes redundancies in your HR department, which is a significant saving considering the high cost of hiring and retaining employees.
Cloud computing also allows your business to conveniently work and collaborate with remote teams. Crucially, remote workers are a lot cheaper since they work as contractors or freelancers.
Fully utilized hardware
Cloud computing is highly scalable and flexible, which means you only pay for what you need when you need it. For instance, once your demand for cloud services goes up or down, you can make the necessary adjustments to cope with the situation. Hosted enterprise services and resources are all about efficient use of computing power.
In addition, you can select the specific services that your business needs, even from different cloud service providers. For instance, if you only need hosted software, you can opt for Software as a Service (SaaS), and if you require a server environment, you may only have to pay for Platform as a Service (PaaS).
Many companies rarely consider the energy demands and consumption of their IT facilities. Servers, networking equipment, and other hardware are never switched off – they can run for months and mostly on idle. Yet, idle electronics still consume and waste a lot of power. An average server, for example, depending on usage, can draw between 500-1200 watts of electricity every hour. With the rising cost and demand for electricity, energy consumption is a valid concern.
Although cloud providers factor energy costs into their price models, they consolidate hardware resources and share the cost among their clients. This cuts the power cost for every service package to a negligible figure.
In fact, from a different perspective, cloud computing is a convenient way for your business to go green. In this respect, cloud migration not only saves you money, but it also contributes to global energy sustainability efforts.
ROI through increased productivity
Finally, cloud computing saves you money by helping your enterprise improve operational efficiency and productivity. IT is often overlooked as a key performance indicator in many organizations. The truth is, an efficient and reliable IT infrastructure can drastically motivate workers and process productivity.
Cloud migration streamlines your workforce and promptly equips them with the computing resource they need to complete their tasks on demand. There is no better way to use IT to empower and motivate employees. Plus, think of all the money and time you’ll save from not having to deal with common inconveniences such as power outages and breakdowns.
Hopefully, it’s clear now how cloud migration can save you money in the long run. The cloud is a proven alternative to on-prem IT structures, and cloud providers will go above and beyond to meet your IT needs. The money saved through cloud computing can be put to more productive use in growing the business. Besides, isn’t business about cutting costs to maximize profits?