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My cloud costs what?!

Debates about the true cost of cloud computing have been happening since Amazon Web Services first debuted more than a decade ago. However, it’s only in the past few years—as early-adopter startups have grown into IPO-ready companies and large, traditional enterprises have really began using IaaS resources in earnest—that we’re getting some useful glimpses into what it really costs to operate in the cloud. And those costs are often higher than what people expected to see.

There have been some news stories lately highlighting just how expensive cloud costs can be, complemented by some good commentary on just how reasonable those expenditures are:

The easy reaction for public-cloud critics (especially to some of the more hyperbolic headlines) might be to shout, “I told you so!” If you look a little deeper, though, it’s clear that the answer to high cloud bills is more nuanced than simply pulling everything back into a corporate data center—if only because so many companies have already embraced the cloud as major part of their IT strategy going forward. That cat is out of the bag to stay.

Rather, the right discussions to be having are around things like right-sizing cloud infrastructure to workloads (over-provisioning happens a lot in the cloud, too); getting rogue instances under control; being able to predict future demand; and figuring out where to use cloud-provider services (e.g., managed databases) versus ISV or other third-party services. That last issue is often couched in terms of lock-in, but should also be discussed in terms of vendor priorities and business models. Nothing comes free in enterprise IT, so it’s wise to consider where you’re paying for higher value and where you’re just paying for more stuff.

And, interestingly, containers—which often are touted as a solution to over-provisioning, because you can theoretically pack many of them onto a single machine—are increasingly cited as a cause of additional spending. Some of this is an analogue to zombie VMs and cloud instances (they’re spun up but never spun back down), and some of it comes back to the idea of right-sizing the machine to fit the workload. But it all speaks to some 101-level cloud-native rules around investing in capabilities like automation, monitoring and container orchestration to truly maximize efficiency.




WHAT'S NEW ON INTERSECT

Welcome to Intersect

‘Objection inversion’: Why platform ops can create new champions in IT

The CIO’s guide to Kubernetes

Microservices are not the destination

Duke Energy is using data to validate corporate strategies. You can, too

WHAT YOU NEED TO KNOW THIS WEEK
How Amazon forced retailers to change for the better

Amazon Dash was marketing genius (Gartner Blog Network): Basically, the argument goes that Amazon forced other retailers to get innovative, and the ones that followed its lead are thriving.

Walmart, the empire strikes back through unified retail commerce (Gartner Blog Network): “Unified retail commerce first involves understanding how customers use technology in their everyday lives, then deploying technology that makes their lives simpler, better, easier and safer.”

Digital transformation is about efficiency, customer experience and trust

How Shake Shack is betting on technology on front-end and back-end to hit $700 million in revenue in 2020 (ZDNet): New CIO and millions a year on “an ERP revamp called Project Concrete, digital marketing and more ways to cater to customers.”

Don’t look now, but 146-year-old Levi’s just hired an artificial intelligence officer (Adweek): Some small portion of this will probably be generally recognizable as “AI.” Really—and importantly—it’s about better analytics.

Bun fight breaks out after devs, techie jump ship: Bakery biz Panera sues its former IT crowd (The Register): Corporate intrigue aside, the tech in question is a whole system, described in some detail, designed to streamline the ordering process for customers and how restaurants are run.

Cybersecurity is putting customer trust at the center of competition (Harvard Business Review): Why Apple and others are betting on security and privacy practices as a means to garner consumer trust. Smart move in today’s world.

How is software developed at Amazon? (High Scalability): Lots of nuggets in here, but the explanation of this rule—”Leaders at Amazon are expected to model what's important.”—is critical everywhere.

Doing AI right means keeping humans in the loop

Humanity + AI: Better together (Andreessen Horowitz): An a16z partner explains advances in AI and why they’re still not magical without humans involved. And that’s fine.

Microsoft’s latest security service uses human intelligence, not artificial (Ars Technica): Well, like most good AI applications, it uses models for the easily automated stuff, and humans for when customers really need to dig into an issue.

Interesting cloud news

Hackers can slip invisible malware into bare metal cloud computers (WIRED): Remember when VMs were considered more dangerous? Turns out that might not be the case in the cloud, as bare metal instances can expose firmware access.

The danger of having a cloud-native IT policy (InfoWorld): Basically, this is a reminder that going all-in on public-cloud services can lock you into those services and that cloud.

OTHER RESOURCES WORTH CHECKING OUT

CEOs: Foster the software teams and talents your firm needs (Forrester)

Put customers at the center of tech processes (Forrester)

6 things you need to know to safely run Kubernetes
(Pivotal webinar)

AI for everyone (Coursera)

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