Back

The Cost of the Cloud (or not)

Moving to the could, whether a startup looking to lower initial capital expenditure or an established company lowering Total Cost of Ownership (TCO), provides a cost structure that can't be overlooked.  It allows innovation and creativity in a business plan or a product to reach the market without requiring a huge up-front capital outlay.  Good news for the next crop of entrepreneurs!

    OLD WAY OF   YEAR ONE   NEW WAY OF YEAR ONE
    DOING THINGS   COST   DOING THINGS COST
SERVERS   BUY 15 MACHINES AT $7,000 TO $10,000 APIECE $70,000   SIGN UP FOR AMAZON WEB SERVICES $250 A MONTH AT FIRST, ON A VISA CARD. GROWS TO $2,500/MONTH
PEOPLE TO RUN SERVERS   HIRE 5 IT SPECIALISTS AT $60,000 APIECE $300,000   LET AWS DO IT $0
ENTERPRISE E-MAIL   BUY A MICROSOFT EXCHANGE LICENSE $25,000   USE GOOGLE FREE AT FIRST. $25/MONTH/USER IF YOU GET BIG.
OFFICE SOFTWARE LICENSE   BUY A MICROSOFT OFFICE LICENSE $25,000   USE GOOGLE DOCS FREE AT FIRST. $25/MONTH/USER IF YOU GET BIG.
DATABASE SOFTWARE   BUY AN ORACLE LICENSE $25,000   RENT BY THE HOUR FROM AWS BUILT INTO AWS CHARGES. ABOUT $1/HOUR WHEN YOU USE IT
PHONE/WEB INFRASTRUCTURE   BUY FROM TELCO OR CABLE COMPANIES $2000 TO $3000/MONTH   GET CONNECTED VIA THE CLOUD $5,000/YEAR
FILE SHARING   BUY AN OPENPAGES LICENSE $100,000   USE A FREEMIUM SERVICE SUCH AS BOX.NET FREE AT FIRST, $15/MONTH/USER IF YOU GET BIG.
TESTING SOFTWARE   BUY A MERCURY INTERACTIVE LICENSE $100,000   USE HADOOP OPEN SOURCE FREE
TOTAL   $600,000, MINIMUM     $50,000, TOPS

Source:  "Thrifty Does It", Forbes, 5/2012

Previous
Comments
Trackback URL:

Add Comment
This is incredible, how much companies can save!
Posted on 6/19/12 12:02 AM.