How to calculate the cost of cloud migration

One of the biggest concerns IT teams have about the cloud, is how much it will cost. In the video below Gary Duke highlights how a Cloud Economics Assessment will answer that question and more, including what workloads are best suited to the cloud and would be best staying on-premise. However, to understand whether migrating to the cloud will drive cost efficiencies, you need to start by knowing how much your current on-premise environment is costing your organisation.

When you know how much your on-premise hardware and software costs, you can then compare that against the cost of cloud migration and running your IT in the cloud.

The cost of cloud migration vs. on-premise costs

Calculating and comparing cloud versus on-premise comes with some challenges. Your on-premise environment is typically a CapEx model, whereas cloud resources subscribe to a OpEx-based cost model. 

For this reason it’s helpful to consider the lifespan of your upfront CapEx investment and compare against cloud costs over the same timescale. It’s not an exact science but will give you a baseline figure to get started with.

Lift & shift or refactoring?

Another consideration is whether you go for a lift & shift migration model where all apps and data are moved to the cloud ‘as is’. While this is a quick solution your apps might not get the full benefits of cloud features, including the cost efficiencies you may be hoping for. 

Alternatively, refactoring, where apps undergo architectural or coding changes before migration, is more complex and will incur more upfront costs but they will be more cost-effective to run in the cloud.

A Cloud Economics Assessment uncovers all the assets that currently sit on your network and visualises what they will look like in the cloud. From this you can understand whether a lift & shift approach is suitable, or if refactoring will deliver the ROI and business outcomes you desire.

Watch the video below to learn more, or get in touch with our team to discuss your organisation’s digital transformation journey:

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