A recent Gartner report estimated that 80 percent of organisations will overshoot their cloud budgets by 2020 because of a lack of optimisation. Obviously, this frustrates executives. It’s particularly hard to deal with in the case of multi-cloud environments, where each provider’s bill might be a million-plus lines long.

If your organisation is among those with surprisingly high multi-cloud costs, rest assured: it’s possible to align costs with expectations. Here, I outline a strategy that will help you do so by addressing the root causes.

First: Why multi-cloud?

Before tackling cost, it’s essential to understand the underlying strategic business reasons for using a multi-cloud environment. Common reasons include:

• Avoiding vendor lock-in: Many organisations opt for multi-cloud because they want to avoid being tied to a single cloud provider. While this is a fine strategy, it leaves out an important fact: many of the most valuable features of any cloud environment cannot be accessed unless you’re all in. It’s important to understand that there are opportunity costs here, too
• Customising the cloud to business requirements: If various apps in your business require different functionalities, a multi-cloud solution may let you maintain existing functionalities and processes rather than adapting to fit the capabilities of your cloud provider
• Mitigating risks from potential cloud outages: When you’re in multi-cloud, the outage of any one cloud platform is less likely to harm the business overall

If you didn’t have a particular strategic reason for choosing multi-cloud – or if your main reason was that you hoped to save money – you may want to consider moving to a single-cloud setup. With a single cloud provider, you may be a big enough customer to get discounts or freebies (like security services), which can help keep costs down.

You may also, as I mentioned above, be able to use features that could improve your business in various ways.

If, however, your strategic reason for choosing multi-cloud is still relevant – meaning you want to maintain your multi-cloud setup – it’s time to consider two things: the architecture of your cloud environment and your total cost of ownership.

Architecture: Make sure you’re not double-paying

Moving an in-house data centre to the cloud requires more than a simple lift-and-shift. That’s doubly true for multi-cloud, where certain architectures can substantially increase what you pay for cloud services.

For example, if you have an app that straddles different clouds and sends data between environments, you may incur bandwidth charges every time the app sends a request to a different environment.

Depending on the app’s functionality, this could add up to a lot of unnecessary costs. It’s common for thousands to tens of thousands of dollars a month to be eaten up by inter-application data transfer costs. The solution: examine how your apps are structured within the clouds you’re using and adjust that structure to limit double dipping.

In some cases, using software like CloudCheckr or CloudHealth can help this process; these apps analyse costs and make recommendations about how to lower them. But keep in mind that recommendations are not business-specific. Many will be red herrings. You’ll need a knowledgeable cloud professional to evaluate the recommendations in light of your specific business goals.

Total cost of ownership

Even if you can reduce cloud-specific costs with improved architecture, don’t forget to consider your infrastructure’s total cost of ownership. TCO is often higher in a multi-cloud setup, even when cloud-specific costs are lower. Why? There are three main reasons:

• In a multi-cloud environment, your IT team has to learn multiple clouds. That means more training time and less doing time, longer onboarding for new hires, and longer time to proficiency in each cloud environment. This shouldn’t necessarily be a deal breaker, but it’s an important consideration
• In a single-cloud setup, some providers will offer discounts. I mentioned above that many cloud providers offer freebies, like security features, for customers in a single-cloud environment. In a multi-cloud setup, you’ll have to pay a third party for security software and other products that you might have otherwise been able to secure through your cloud provider
• In multi-cloud, you’ll miss out on certain capabilities. The cost of avoiding vendor lock-in is losing access to the features and capabilities that are only available when your business is all-in on a single cloud provider

These costs, of course, may be acceptable depending on your strategic reason for maintaining a multi-cloud setup. The key is to consider them in a strategic context.

Cloud decisions are business decisions

As with any cloud decision, the choice of whether to stick with a multi-cloud setup should be driven by larger business goals. The cloud infrastructure should serve the business – not the other way around. If you’re unsure where to start in evaluating your cloud architecture and spend, talk with a knowledgeable cloud consultant, who can make recommendations based on your business goals.

Interested in hearing industry leaders discuss subjects like this and sharing their experiences and use-cases? Attend the Cyber Security & Cloud Expo World Series with upcoming events in Silicon Valley, London and Amsterdam to learn more.