How Cloud is Making A Cost-Efficient IT Infrastructure Revolution Possible

Most enterprises tend to get to get their cloud strategy wrong. When done right, it can be a game changer for your business operations. But either they are too ambitious or are overwhelmed with the complexities associated with it. We’ve helped hundreds of businesses adopt the cloud.

Today, the question is not if you want to implement cutting-edge technology. Every business relies on technology. The question businesses want to answer is, whether it will help them push their bottom line. Let me share my learnings about cloud adoption and how to do it right.

How Does IT Infrastructure Change When Moved to Cloud

Cloud has the power to transform your IT setup and the way your business operates.

A lot of companies find this switch pretty overwhelming. They all want to make things faster and smoother, which is great.

But I get it, changing stuff we're used to can be tough.

Still, it's important to keep up with these changes. If we don't, we might fall behind our competitors.

According to a recent report by Gartner, 70% of the workloads will be on the cloud by 2024.

Changes You See Once Migrated to a Cloud Infrastructure

Once you move to the cloud, you’ll see a lot of changes in your business operations compared to the traditional setup.

Scalability and Flexibility

Imagine you want to increase the number of endpoints to meet your business needs. Cloud will make that increment incredibly easy. Scalability and flexibility are its forte. It’ll also empower your business to dynamically adjust resources in response to fluctuating demands, a feat less feasible in traditional setups.

A survey of 137 IT executives revealed that 115 planned to migrate more workloads to the cloud in the next 24 months, with 62% citing the need for more flexibility and scalability.

Negligible CAPEX Costs

Transitioning from CAPEX to OPEX, most cloud services adopt a pay-as-you-go model. This shift helps you mitigate hefty upfront hardware investments, aligning costs with usage.

94% of IT professionals in an OpsRamp survey agreed that cloud computing reduces upfront startup costs. Accenture found that moving workloads to the public cloud leads to Total Cost of Ownership (TCO) savings of 30-40%.

Streamlined Maintenance and Management

Cloud services providers, like we at Netcon, shoulder the bulk of maintenance and upgrades. It’ll free up your internal IT team to pivot from routine upkeep to more crucial tasks.

Enhanced Accessibility and Collaboration

With cloud computing, you’re no longer bound by geographical barriers. It boosts accessibility and collaboration and facilitates remote work. It helps you synchronize your business operations seamlessly.

Refined Security and Compliance

Although cloud services bolster security and compliance, you must adeptly navigate the shared responsibility model, tailoring their security strategies accordingly. I highly recommend being thorough with your cloud provider about security concerns and compliance.

72% of organizations are defaulting to cloud-based services when upgrading or purchasing new technologies. However, 96% of organizations have faced significant challenges in implementing their cloud strategy, with security management being a major challenge.

Robust Disaster Recovery and Data Redundancy

Cloud solutions inherently include disaster recovery plans and data redundancy. Hence, they significantly enhance data protection and help you achieve uninterrupted business operations.

88% of businesses say the public cloud will play a role in their future backup strategies, and 91% agree it will play a role in disaster recovery strategies. 54% of organizations consider data protection modernization crucial to their digital transformation projects.

Reducing IT Infrastructure Investment Costs With Cloud Computing Adoption

An assumption and a big hurdle I’ve usually sensed while talking to our cloud clients is that moving to the cloud is costly. But it’s a false notion, driven by another false notion that the latest technology has to be expensive. When done right and done for your specific needs, the move to the cloud can lower your investment and operating costs.

Companies utilizing cloud computing save approximately 20% annually on infrastructure costs. Businesses can also lower their energy consumption costs by 30-60% by leveraging cloud technology.

Let me explain with the example of Cochin Airport here. We’ve helped them with their private cloud infrastructure and migration, along with other solutions. Their core applications, SAP and Oracle, were running on a virtualized hardware environment. As performance demands increased, the licensing costs increased.

Lowering Operational Costs

To eliminate these high recurring operational costs, they moved to a private cloud setup, operated and maintained by Netcon. We manage the maintenance, upgrades, and scalability of the infrastructure.

Because we do all of these crucial tasks for them, it has reduced the operational costs for Cochin Airport. They don’t pay high charges to run SAP and Oracle applications on virtualized hardware. Their private cloud serves as a better platform with a higher performance ceiling.

Better Resource Utilisation

For Cochin Airport, we’ve also deployed centralized management and visualization, virtualization, and dynamic resource allocation tools. It has resulted in higher utilization rates of the resources. We’ve reduced the need to overspend on resources by optimizing the existing ones.

Simplifying IT Infrastructure Management Through Cloud Computing

Once moved to the cloud, there’s virtually no physical IT infrastructure for you to manage. Your vendor will manage and maintain it for you. It’s obvious that cloud eases the management of infrastructure.

Let me give an example of another case study. We’ve deployed and connected high-tech ICT labs for 6029 public schools across Tamil Nadu under this project.

All the study material, web apps, lectures, and exams happen on these computers in the labs. These computers are thin clients connected to the server. The content and the services are pushed to them via leased line internet and a central command center - a private cloud.

Automatic and Timely Updates

To keep these essential study cycles going at all the schools, software updates, and patch management are essential. They ensure the security of the setup. Because we maintain it for Textbook Corporation, we push them automatically and timely to ensure the systems are always up-to-date without manual intervention.

Imagine the hassle of doing it manually for 6029 schools across the entire state. Quite a job, right?

Simplified Disaster Recovery

Disaster recovery is built into this cloud setup. It simplifies the complex and resource-intensive process of planning and implementing disaster recovery protocols for Textbook Corporation. So, they are worry-free. It’s our headache, of the cloud provider.

Reduced Management Complexity Benefits

The central command center can access, manage, and monitor each machine on any of the 6029 schools remotely. Our support staff resolves any tickets raised by the school officials. Because of this setup, there is incredible transparency and ease of management.

SaaS and IaaS

SaaS(Software-as-a-service) delivers applications over the Internet, eliminating the need for installation, maintenance, and updates on individual devices.

IaaS(Infrastructure-as-a-service) provides virtualized computing resources over the Internet, offering scalable and flexible infrastructure solutions. We’ve deployed both for Textbook Corporation.

Our cloud infrastructure runs their educational applications. Netcon maintains and operates the entire infrastructure as a service, enabling more focused and efficient IT management. Hence, the authorities can focus on the core initiative, of uplifting the education standard in these schools.

Leveraging Visualization Tools

We’ve deployed visualization tools in this cloud environment that provide clear, real-time insights into each system. These tools help our team monitor and manage the resources, workload distribution, and performance metrics. They are more informed about the issue, leading to better decision-making and quicker problem resolution.

A survey found that nearly three-quarters (74%) of respondents assessed the impact of data visualization on business insight as "very high" or "high." More than two-thirds (67%) said that data visualization has had a "very high" impact on user productivity.

If we hadn't used thin clients, servers at each lab, open-source operating systems, and applications, we wouldn't have enough resources to spend on the unified, connected private-cloud-based setup for these schools. They’d need manual intervention for every little hiccup. We saved a lot of resources by going open source and we spent them in the right place.

Comparing Cloud Computing and Traditional IT Infrastructure

Now that we’ve looked at how cloud brings in a lot of cost and operational benefits, let’s clarify the differences between cloud and traditional IT. They’ll surely give you reasons as to why you should move to the cloud if you’re stuck with the traditional IT infrastructure.

Key Differences

Now that we laid out the differences, let us explore the pros and cons with some context.

Pros and Cons

Cloud is cost-effective. We saved high recurring costs for Cochin Airport. It's highly scalable. It'll be a breeze if we were to add 10 more schools to the Textbook Corporation project. For traditional infrastructure, that would be a headache to execute. And it'd be costlier.

Cloud enables remote access - all the school labs are connected and controlled remotely. And the maintenance is on us for these projects. So, the authorities or their IT teams can relax. For an old-school setup, your IT team would always be on their toes, always fixing something that would have gone wrong.

There are a few cons of the cloud. Everything cannot be all rosy and beautiful, right?

You and your IT team must be vigilant and keen about data security because it is a shared responsibility. But you can set up the traditional IT to meet minute and specific compliance requirements. That’s one advantage of it.

The Internet plays a huge role in a cloud setup. No internet, no cloud. Keeping reliable access to the internet is a big challenge. That’s why we have used a leased line for the Textbook Corporation project. Usually, in a public cloud setup, you have less control over the infrastructure. Whereas in a traditional setup, you have all the control over the infrastructure and its utilization.

How Public Cloud Reduces IT Infrastructure Costs

The case studies I talked about above were mostly private clouds, with bits of public clouds here and there. But during this whole conversation, I created a concoction of my experience and discussed how the cloud can aid better, more streamlined business operations. We already know it reduces the infrastructure costs.

Public cloud services offer a compelling value proposition, according to me. For businesses seeking to optimize IT costs while maintaining flexibility and scalability in their operations, the public cloud can be the way forward.

Cloud services infrastructure spending saw a 35% year-on-year growth in the first quarter of 2021, reaching $41.8 billion globally. This represented an $11 billion increase from Q1 2020.

Capital and Operational Expenditure

The public cloud optimizes operational expenses. Its pricing model is based on your usage, not fixed assets. It is a big advantage for businesses unsure of scaling, growth, and demands. They can align their spending more closely with actual needs and demand.

Maintenance and Upgrades

You may need to discuss your private cloud with your provider - Cochin Airport authorities talk to our team about the status of the infrastructure. But in a public cloud - AWS, Azure, and so on - the responsibility for maintaining and upgrading infrastructure is solely on them. It is a huge relief as you don't need an IT team to manage it, reducing your overall costs.

Comparing Different Cloud Models

Public Cloud

Public clouds are economies of scale. They offer a shared resource environment, lowering costs. Consider that you are a small or medium-sized business with variable workloads and want to have a private cloud. Just estimate the costs of servers, data center, and the rest of the paraphernalia and the efforts of making it all work.

Private Cloud

Cochin Airport has a private cloud setup. It offers enhanced control and security. However, it requires significant investment in dedicated resources. These costs include hardware, software, and the necessary personnel to manage and maintain the infrastructure. Some solution providers, like us, will operate and maintain the infrastructure for the client.

However, I can safely say that this setup is more suitable for organizations with specific regulatory compliance needs or those requiring extensive customization. Airports fall into both these categories.

Hybrid Cloud

Hybrid clouds combine the benefits of both public and private clouds. However, they can incur higher costs due to the complexity of managing and integrating different environments. The cost efficiency of a hybrid model depends on how effectively a business can balance and optimize these resources.

The Future of Cloud

In a recent study that Gartner published, they uncovered a trend in Industry Cloud platforms. They are niche, tailor-made, and combine software, platform, and infrastructure-as-a-service to cater to specific industries and their use cases. According to their predictions, they expect 70% of enterprises to adopt an Industry Cloud platform by 2027. That number is currently a mere 15%.

Industries are rapidly adopting them in the American and European markets because of their ability to adapt and cater to the relevant and specific industry challenges.

Migrating to the cloud can reduce carbon emissions by up to 84%.

Final Thoughts

The cloud's role in transforming IT infrastructure from a rigid, capital-intensive model to a flexible, cost-efficient, and agile framework is undeniable. I am proud that we have made it happen for several enterprises. For them, the journey to the cloud is about more than adopting new technology; it is about reimagining operations in the digital age.

With advancing cloud solutions, including industry-specific platforms, businesses will continue to hit and aim for unimaginable levels of efficiency and innovation. The future will see closely-knit cloud services across industries. Businesses that embrace this shift, acknowledging its challenges and leveraging its opportunities, will find themselves well-positioned to lead in the digital era.