Dive Brief:
- Enterprise cloud spending ballooned despite broad adoption of cost optimization tools and FinOps practices last year, according to a Forrester report commissioned by software solution provider Boomi.
- Nearly three-quarters of organizations exceeded their cloud budgets last year, Forrester found, based on a December survey of 420 cloud and IT decision-makers.
- With global cloud spending on course to reach $1 trillion by 2026, respondents expect workloads and costs to grow rapidly over the next two years, the report said. Respondents anticipate significant spending increases in IT ops, hybrid work, software development tools and digital experience technologies.
Dive Insight:
Executives have prioritized cloud cost control, but organizations can’t manage spending until they’re able to track it. Even then, data sprawl and SaaS bloat can stymie optimization efforts.
More than half of respondents pointed to excessive storage as a budget buster. Overconsumption of network bandwidth, an endemic hazard in public cloud’s elastic, spend-as-you-go ecosystem, was cited by roughly 2 in 5 respondents, along with insufficient integration and inefficient architecture.
While FinOps tools and practices help tie cost to value, rationalize provisioning and optimize existing deployments, most organizations still fail to take advantage of built-in hyperscaler discounts, a ProsperOps study found.
Most organizations don’t institute cost controls until the bills roll in, Forrester said.
“Emerging FinOps practices are not spared the challenges associated with reactive cloud cost remediation strategies,” the report said.
It’s more of a visibility problem than an awareness issue, particularly in the enterprise data estate, the report found. Nearly 7 in 10 respondents said their organization attempts but fails to monitor data management costs.
Multiple cloud storage tiers, unanticipated egress charges and fees related to analytics, operations and retrieval can devour almost half of enterprise cloud data storage spending, according to a recent Wasabi survey.
As companies shore up data strategies to support AI implementation, the three largest hyperscalers have taken notice. In the first three months of the year, as regulatory scrutiny of cloud bulling billing practices intensified, Google Cloud, AWS and Microsoft pared back egress fees on some workloads.
The trio of cloud providers have all signed on to the FinOps Foundation, a practitioner organization working to standardize cloud cost management. The organization plans to broaden its focus to include SaaS products and other cloud-based services this year, J.R. Storment, FinOps Foundation executive director, told CIO Dive in February.
