How to Calculate Cloud Computing Costs

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Determining the potential costs of cloud computing can be as complex as the technology itself. Not only are you faced with the different pricing structures of cloud providers, you must find a reasonable way to estimate the resources that you will need in the future. And despite your best efforts, there is no guarantee that your calculations will be correct. That’s because of the variable cost architecture of the cloud.

Of course, you want it to be more than a guessing game.

One way to estimate future usage is to look at what you’ve used in the past. For example, if you can look at your electric bills for the past year, you can get a pretty good idea what your expenses will be over the next few months. That presupposes that you are not making any drastic changes in your electricity usage.

Herein lies the problem. Suppose that you have a website that markets a certain product. Because you have hit the market at the right time with excellent promotion, the website takes off. Thanks to the scalability of the cloud, sufficient resources are automatically ramped up to meet the increased demand. This is good, because the more popular your site becomes, the more sales are completed. On the other hand, your cloud computing costs may go through the roof.

Anticipating the need for resources is the key to calculating cloud computing costs. Those resources include compute, storage, and network. You may find that your cloud computing budget needs to be as flexible as the cloud resources that you are using.

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Written by David Scott Brown
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David Scott Brown has more than 15 years experience as a freelance network engineer. He has worked in both fixed line and wireless environments across a wide variety of technologies in Europe and America. David is an avid reader and an experienced writer.