Cloud Costs: What Drives Up My Fees?

Article originally published here on

Beyond marveling at the range of easily available choices in the cloud, there are some criteria that remain difficult for businesses to evaluate as they attempt to select the right software for their needs. Whether you are a large or small organization, you have defined processes, silos to integrate and proprietary and regulated data that may require specific governance.

There are many more business decisions to be made than an initial set up with a cloud solution of choice. These complexities lead to questions from our own customers - most commonly, ‘What drives up my cloud costs?'

What is the real deal with an SLA number?

How mission-critical an application is to your organization will determine the level of availability you'll want associated with a workload.  The sad truth is that many companies believe they can go hours, days, or weeks without key business systems.  That is, until they experience their first major outage of that system.  For example, the difference between a 99.9% and a 99.99% SLA is 39 minutes 26 seconds of downtime per month.  With a production halt and impact to your customers - this timeframe can become overwhelming, and not one to be repeated.

Site Resiliency

Many people mistakenly believe that because their solution is "in the cloud," everything is backed up from their locations, whether that be one location or sites all over the world. Unfortunately, many cloud providers don't include site resiliency or geographic redundancy in their base offerings.  These are often provided as add-on features, which often increase the price of a cloud deployment - even though this represents a critical piece of a cloud solution. (Note, site resiliency and failover is automatically provided as part of Concerto's standard offering - see the Concerto Difference chart here.)


Often a concern with public cloud solutions is available bandwidth.  This is typically a metered connection and customers have an unpredictable spend, as they aren't sure how much bandwidth they'll need at any one point in time. This can be especially true for organizations running seasonal solutions in the cloud. In contrast, some private cloud providers will include elasticity in their planned costs to accommodate bandwidth usage.

License Costs

The ability to support traditional application workloads in a cloud environment still requires compliance around core licenses to run the platform. Whether you are thinking about a CRM, Accounting, or Content Management solution, the true cost becomes not just the consumption pricing, but the underlying licenses and potential session virtualization technologies that are required to deliver the workloads.

The Elephant in the Room

Finally, there is a price that some industry analysts want to ignore. Behind these cloud services there is still a physical server- in some cases thousands. Cloud Service Providers must acquire and manage large amounts of complex infrastructure to support your workloads.  All this infrastructure has to live in a datacenter that requires the highest of availability of services like power, cooling, and bandwidth.

While many organizations have been able to take advantage of low cost public cloud solutions like Office 365, or CRM Online to meet a standardized list of needs, businesses with more complex requirements have realized that a well-run private cloud provides the promise of availability, performance and compliance.  And with a cost benefit that far surpasses the collection of publicly available cloud services. 

Would you like more insight on calculating costs for private cloud platforms designed for enterprise applications?

1) Contact Concerto Cloud Services for a no-commitment total cost of ownership assessment including an estimate of the computing power required, advanced security and governance, and a comparison of public and on-premise options.

2) View the recorded webcast “How Much Does it Cost for Dynamics in the Cloud?”,  (held in partnership with