What is the value in cost shifting of cloud computing?
Fri 2 May 2014
An alternative look at the ongoing debate about which is cheapest – cloud or on premise? Erich Morisse, who is responsible at Red Hat for its cloud business in the Americas, takes a look at which provides the most value. Spoiler alert – it depends…
“On the consumption side, moving to cloud changes the fixed Capital Expense cost of hardware to a variable Operating Expense cost. Tying the cost of the infrastructure to the lifetime of the project reduces upfront costs.
Spreading the costs over the life of the project does increase the terminal costs of the project, however this is not the problem it seems. With the cloud model, it is also simpler close down when the project is no longer providing the necessary value. ”