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Engineer: Head of Sales
As businesses expand their reliance on cloud computing, several trends are reshaping how organisations are allocating their cloud spending. These trends highlight the evolving IT landscape and the strategic decisions necessary for efficient cloud cost management. Here’s a look at five key trends affecting cloud spending and their implications for IT leader’s budgets.
The adoption of multi-cloud and hybrid cloud strategies continues to accelerate. According to the Flexera 2024 State of the Cloud Report, 89% of enterprises now employ multi-cloud environments, combining the strengths of various cloud platforms to enhance flexibility, performance, and risk mitigation. Hybrid clouds, which mix private and public cloud infrastructures, allow businesses to manage sensitive workloads on-premises while taking advantage of cloud scalability.
The shift to multi-cloud creates new cost challenges as enterprises must manage different pricing models, tools, and SLAs across multiple providers. The complexity can lead to fragmented spending and higher operational costs unless carefully managed through centralised cost monitoring tools. IT leaders must invest in cloud management platforms like AWS Cost Explorer, Google Cloud Cost Management, Deimos One and Azure Cost Management to track and optimise spending across providers. FinOps platforms are essential for ensuring visibility and optimising expenses across diverse cloud environments.
Artificial Intelligence (AI) is reshaping the cloud landscape as enterprises increasingly integrate AI into their workflows for data processing, automation, and decision-making. Cloud providers like AWS, Google Cloud, Azure and Huawei offer AI tools that enhance customer interactions, predictive analytics, and process automation. Concurrently, serverless computing allows businesses to dynamically scale resources based on demand, minimising the need for managing underlying infrastructure.
AI workloads can be resource-intensive, leading to significant cloud expenditure if not carefully managed. While serverless architectures offer cost efficiencies through precise scaling, unpredictable traffic surges can result in unexpected spikes in cloud bills. IT leaders should leverage AWS Lambda or Google Cloud Functions for serverless operations, and Azure Machine Learning for managing AI workloads. These tools offer flexibility in scaling resources dynamically, but real-time monitoring is critical to prevent cost spikes.
With the explosion of data, businesses are investing heavily in data storage, processing, and analytics tools. Industry forecasts indicate that a significant number of enterprises will shift toward cloud-native applications, which demand robust cloud services for effective data handling and analysis.
Increased investments in data management tools can lead to higher cloud costs. Organisations need to ensure that their data strategies align with their cloud spending and that they are using the most efficient services to manage and analyse their data effectively. For better cost control, organisations can use AWS S3 Intelligent-Tiering for data storage and Google BigQuery for scalable analytics. These services offer cost-efficient data management by automatically optimising storage based on access patterns and offering pay-as-you-go pricing for analytics.
Recent research shows that cloud security spending is rapidly increasing as organisations invest more in protecting their cloud environments. This increase is largely due to the rise in complex cyberattacks targeting cloud infrastructures, like malware, ransomware, and misconfigurations, which have led to high-profile breaches.
Additionally, Gartner predicts that by 2027, 70% of enterprises will adopt industry cloud platforms, further emphasising the need for robust security investments as businesses scale their operations in the cloud. This highlights a major shift in IT budgeting, with a significant portion now dedicated to cybersecurity measures specifically aimed at cloud environments.
While investing in security is essential, it can significantly drive up cloud costs. Organisations must balance their security investments with cost management strategies to avoid exceeding budgets while ensuring robust protection against threats. Tools like AWS GuardDuty, Google Cloud Security Command Center, Azure Defender, and Cloudflare Zero Trust offer cost-effective solutions to enhance cloud security. These services help businesses mitigate cyber risks without overspending by providing scalable protection and monitoring.
As organisations strive to improve their sustainability profiles, there is a growing emphasis on optimising cloud spending through energy-efficient practices. Businesses are becoming more aware of their carbon footprint and are seeking cloud providers that prioritise sustainability.
While shifting to more sustainable cloud solutions may involve initial investment, tools like Google Cloud Carbon Footprint, AWS Sustainability Pillar, and Azure Sustainability Calculator help optimise energy use. Over time, these investments can yield cost savings by reducing resource consumption and operational expenses.
As the cloud landscape evolves, the emphasis on cost transparency and optimisation will only grow, driven by the increasing complexity of cloud environments. IT leaders need to stay updated on these trends to manage costs effectively and maximise cloud investments. Deimos offers a comprehensive cloud cost optimisation service, which includes a detailed assessment of resource usage and cost-saving opportunities. Their expertise ensures businesses reduce unnecessary spending while maintaining scalability and performance.
If you would like to learn how Deimos can help you optimise your cloud costs, click here.
