Skyscape assesses Cloud TCO

Skyscape Cloud Services Limited has released the results of its research into the true cost savings that can be achieved by moving to the cloud. Skyscape’s report, ‘Cloud: The Total Cost of Operation – Building the business case for change’ compares and assesses the different associated costs of traditional on-premise solutions with the cloud for real-world computing scenarios faced by the UK Public Sector at different business impact levels.

In order to assess whether the cloud can really deliver cost savings when compared to a traditional hosted solution, Skyscape compared and analysed cloud solutions against dedicated, virtualised solutions in the following three real-world computing scenarios: An Impact Level 0 (IL0) compute platform for test and development; an IL2 compute platform used to host a high-traffic web application used by citizens and an IL3 compute platform used to host a complex enterprise application.

Skyscape’s comparisons considered costs over a three-year period and found the cloud solutions to be the most cost-effective across the board. Furthermore, it is also important to note that these significant cost savings – as much as 61% in the case of scenario 1 – are conservative estimates, as additional staff and accreditation costs have not been taken into account. Therefore, the true cost savings offered by cloud solutions – particularly at higher Impact Levels – would be considerably more.

“Across all of the different scenarios we tested, the results of our detailed cost comparisons for meeting different real-world compute requirements speak for themselves,” said Phil Dawson, CEO of Skyscape Cloud Services. “In addition to the cost benefits and the increase in agility and availability, other significant business benefits can also be realised by adopting the cloud, but we did not attempt to quantify these in our figures as we recognise different organisations will account and value them in different ways. These include quicker and easier procurement, an improved quality of service, increased staff productivity, reduced energy consumption and greater security. With all of these advantages, I would argue that the business case for implementing a cloud solution becomes not just strong, but indisputable, particularly for organisations that require higher levels of accreditation for their data.”

Cloud computing is now an integral part of the UK Government’s ICT Strategy, with a number of key programmes and policies having been introduced in recent years, including the G-Cloud Framework, the Cloud First policy and the Government’s Digital by Default strategy. As a result, increasing numbers of public sector buying communities are considering the cloud, with the G-Cloud CloudStore offering them a far greater range of suppliers and solutions than was previously available.

To help public sector organisations that are yet to realise the benefits of cloud computing, Skyscape’s research aims to assist buying organisations that are now faced with the challenge of moving away from a familiar ICT procurement model, towards unfamiliar frameworks – including G-Cloud. In order to make this decision, organisations need to first understand whether a cloud solution is appropriate for their needs and if it can really deliver the desired cost savings, as there are a number of considerations to be made. These include capital expenditure, the cost of design and deployment, and ongoing infrastructure and operational costs.

Dawson added: “Buyers provisioning in-house or dedicated solutions need to be able to accurately predict or be confident of the traffic or demand that their users – citizens, employees and other end-users – will place on the application, and exactly how this will vary over time. Getting it wrong can mean resources are under-utilised or lead to a degradation in service. Adopting a cloud solution removes the requirement to accurately predict workloads, as the capacity available can be scaled in line with demand. Cloud solutions also offer consumption-based pricing, which means that organisations pay only for what is consumed, enabling significant cost savings.”