Cloud growth slowing as customers get a dose of cost reality

Research from tech services membership and standards body The Uptime Institute is showing slowing growth in the major cloud providers, suggesting that the era of hyper-expansion is drawing to a close.published this week, the institute said that AWS reported a quarter-on-quarter revenue increase of 27.5 percent for Q3 2022, this is down from 33 percent in Q2 — which it noted was"the slowest growth in its history.

The Uptime Institute attributes the slowdown to economic realities. Cloud buyers are seeing higher energy costs together with other kinds of inflation, making them cautious about spending money. "Public cloud is not always cheaper than on-premises implementations, and many organizations may have concluded that migration is just not worthwhile in light of other financial pressures," the institute adds.

"Hyperscaler cloud providers, which are more interested in building longer-term relationships than in deriving higher gross margins in the short term, offer tools to help users reduce expenditure. These tools have improved significantly over the past few years," the report says.AWS's Q3 2022

The public cloud market has experienced 30-plus percent annual growth rate for nearly a decade. The pandemic “remote wave” continues to accelerate it; the value of cloud was proven, even as companies now reign in remote work. More workers will connect to cloud apps even from HQ.

A full accounting of true on premises cost almost always comes out higher than cloud. Having enough excess capacity for traffic spikes and equipment failures in on premises is extremely expensive. In cloud, that cost is averaged among customers.

“Workloads that are data intensive rather than compute intensive don't go well in the cloud. This has been known for 10 years.” They kill you on the ingress/egress bandwidth costs.

Meanwhile, semi-retired server admins be

there's a hole in your bucket..

AWS cost management is a skill in and of its own right. In other words, unless you have that skill, you're going to pay a lot more than you need to.

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