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The meter’s always running in the cloud

Protocol Enterprise

Hello, and welcome to Protocol Enterprise! Today: How the internal cost-control tools provided by cloud providers still require users to do a lot of the heavy lifting, how Ukraine’s tech sector will bounce back and Google Cloud makes a big open-source move.

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Whoa, big spender

As cloud computing has become mainstream, gaining visibility into cloud costs and controlling them has become a perennial issue for enterprises. And the cost-management tools offered by the cloud providers don’t get the job done.

Cloud costs continue to grow, and the amount of wasteful spending remains high, according to the Flexera 2022 State of the Cloud Report survey released in March. For the sixth straight year, optimizing their existing cloud use to realize cost savings — sometimes known as FinOps — was the No. 1 cloud priority this year for enterprise technical and business professionals. Better financial reporting on cloud costs also was a top initiative.

  • FinOps and this whole optimization and cost management are a critical part of the cloud operating model that customers have to put in when they're moving into the cloud estates,” said Chris Wegmann, managing director of Accenture’s AWS Business Group Technology and Practice.
  • Deploying FinOps encourages data-driven management of cloud spending while simultaneously increasing efficiency and typically reduces cloud spending by as much as 20% to 30%, according to Accenture.
  • While cloud vendors provide some tools and support through technical account managers, customers must play a very active role, according to Wegmann.
  • “It is a shared responsibility, because … AWS can't make those changes on your behalf,” Wegmann said. “A lot of customers, in their on-premises environments, don't have that visibility, so they don't know where the spend is. But that's a big advantage in cloud.”

The cloud providers offer basic cost-management services, but they typically must be augmented by third-party software and require cloud users to do some of the heavy lifting.

  • “Data is absolutely critical for cloud cost management, optimization, and that usually comes down to tagging,” Wegmann said.
  • If you know what kind of computing performance your application requires, AWS has more than 475 instance types that customers can choose from to give them the best price-performance scenario, noted Chris Grusz, AWS’ director of Business Development, AWS Marketplace, Service Catalog and Control Tower.
  • “[AWS] Marketplace also integrates into a number of our partner solutions, so that if a customer wants to view third-party spend for SaaS applications alongside their AWS consumption, we also have ways to feed into a lot of the popular cost-management products that are on the market,” Grusz said.

Helping customers control their cloud costs comes down to maintaining long-term relationships, according to Amit Zavery, general manager and head of Platform for Google Cloud.

  • “If they’re successful, we're successful,” said Zavery, who manages Google Cloud’s commerce, billing and monetizer product team.
  • Zavery’s team builds the cost-control and cost-management capabilities provided to customers through the Google Cloud Console, which incorporates customers’ cloud usage and historical data.
  • “We've been trying to make sure that we provide as many tools and capabilities so that customers can look at their usage, manage the cost and optimize their capability usage as well so that they can have a better outcome using our products from the economic perspective,” Zavery said.

While the Big Three cloud providers say they help customers or make it easy for customers to monitor and control their costs, Corey Quinn begs to differ.

  • “All three of them will tell you they absolutely do, but they do not,” said Quinn, chief cloud economist for The Duckbill Group, which helps AWS customers manage their cloud costs.
  • “They offer different tools, different points of visibility and the rest, but part of the problem is that they are distant enough from their customers that they do not fully understand the scope of the problem. And on some level, let's be clear, this is an intractable problem to have to solve.”
  • The complexity of understanding and controlling cloud costs is driven by what an organization looks like — how large it is, how it interfaces across functions — and its technology stack.
  • “The more elastic and cloudy and higher-level services that a cloud provider has that you use, the less predictable the spend becomes,” Quinn said. “Yes, it becomes a lot more efficient, but also a hell of a lot harder to predict.”

Quinn usually starts customer cloud-cost conversations with a series of questions.

  • Is their cloud bill accurate? Is there a bunch of stuff that should be turned off? Are there misconfigurations in an engineering sense that relatively small changes would have a dramatic impact on? Do they have contract negotiations coming up?
  • After all, cloud computing isn't just a rental server market; it's an entirely new way of building and maintaining applications.
  • “You will not realize an appreciable cost savings for at least five years — arguably ever, depending on what you do,” Quinn said. “So the reason to do it instead is because of a capability story — it lets you move faster as a company.”

— Donna Goodison (email | twitter)


Join experts from Salesforce, Crowe, Banner Health, and Formstack as they discuss the 2022 State of Digital Maturity: Advancing Workflow Automation report, the movement toward continued automation, and the top ways to accelerate your organization's digital maturity.

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Ukraine’s IT sector bowed, not broken

Before the Russian invasion of Ukraine, the Ukrainian IT sector was booming. Citizens were flocking to the IT industry in droves, universities were pumping out new talent and a wave of large global technology companies were looking to the country for employees. However, war has forced thousands of tech employees to flee the country.

But Denys and Igor Zhadanov, Ukrainian brothers who were instrumental in starting productivity app company Readdle, think the industry will bounce back. From a small team in a garage, the brothers grew Readdle to hundreds of employees across the world, scattered across Ukraine, London, Silicon Valley and Berlin. Now stationed in places in New York and Berlin, the brothers are still bullish about Ukraine’s potential as a top source of technical talent.

The proof is in the numbers. “Last year, the numbers I’ve seen have shown that we've crossed 200,000 engineers in Ukraine in general,” said Igor. “So we're talking about developers, QA, product people, designers all over the place.” That figure is also up from two years ago, when Igor estimates there were only 120,000 engineers.

“I think lots of people in Ukraine, they are accustomed to finding solutions within scarce resources,” said Igor. “You don't have enough money just to go and buy off-the-shelf cloud solutions,” he said. Instead, you have to put your engineering talent to work to figure out how to build internal tools that might mimic Amazon or a CRM or Slack.

— Aisha Counts (email | twitter)

Around the enterprise

Google Cloud plans to submit Istio to the CNCF, finally moving the open-source service-mesh product into a vendor neutral home after years of debate about the best course.

Google also announced that its Media CDN is open for business for customers that want to run their multimedia content on the network that YouTube uses.

Oracle released patches for a nasty flaw in Java that could allow hackers to spoof authentication messages, including two-factor authentication notifications.


Join experts from Salesforce, Crowe, Banner Health, and Formstack as they discuss the 2022 State of Digital Maturity: Advancing Workflow Automation report, the movement toward continued automation, and the top ways to accelerate your organization's digital maturity.

Learn more

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