Don’t Be Fooled — The Public Cloud Can “Crush” You Financially if You Don’t Do Your Due Dlligence

Jun 28, 2018
by Josh Anderson

NEW YORK, NY — At the Seventh Annual New York City Data Center Summit this Spring, CapRE gathered a panel of regional insiders for a discussion on The End-User Approach to On-Prem, Hybrid, the Cloud, and Tomorrow’s Compute Needs and Initiatives. While much of the conversation focused on which applications should go where, Moderator David Spiewak, Managing Principal at DJS Group LLC and Next Tier HD asked panelist  Joe Sardella, Director of Sales for the Northeast, QTS to comment on whether start-ups should “start fresh” with the Cloud.

data center summit“Talking about SaaS and infrastructure providers as a group…they’re the Cloud, but they’re not,” he began. “You have to split the two apart. SaaS providers provide a very specific function, and they charge differently, and they provide that function – like email or SalesForce or something like that. Those are easy. And you absolutely should do those types of things. But when you’re talking about core applications, if you do the analytics on cost, Amazon, Azure, and Google, if you’re going up there just to save money, it absolutely is not going to help you.”

“It’s like leasing a car. It’s going to be more expensive,” explained Sardello. “The only way you’re going to be able to do that is to actually take advantage of some of their advanced programming capabilities, and then you just married them. If you’re doing managed services with Amazon —  so, serverless, which I actually think is going to take off to some extent – you are coding to their serverless API and you are stuck. You cannot move back to back. It’s cool if you’re new and you want to move that.”

To be clear, this decision can save you a lot of money. “You have to make that decision up front, but if you are moving applications up there, and you’re doing the analytics around the financials, you’re going to get crushed,” he warned. “And I’ve seen it happen – I’ve seen a lot of customers just go, We’re going to move this application up there and we’re not going to go through the financial discussion as to what it’s going to cost me.”

After all, according to Sardello, they still have to operate them. “It’s not like their IT guys are going to go away,” he stressed. “You now have to move from doing a lot of machine things to being cow herders – you have to turn these things off and on, and kill them at night, in order to make them function properly. So I would say, if you’re looking at SaaS functions, absolutely do it. but if you’re looking at core applications, you’ve got to do all of your due diligence, which includes financials as well.”

For more coverage of this panel, check out earlier CapRE Insider Reports:

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