Cloud Delivery and Hosting Models - Deploying and Managing a Cloud Infrastructure - page 167

Feature
Up-Front Costs On-Premises Off-Premises Description

Recurring Costs

Maintenance and
monitoring

$350 Included Personnel expenses

Offsite/online
backup

$50 Included Disaster recovery

solutions

Upkeep $800 Included Electricity and other

utilities

Cloud hosting $0 $1,000 Monthly

subscription fee

Total Recurring Cost $1,200 $1,000

Unplanned repairs $2,000 × 3 $0 May be caused by

accidents and natural
calamities and assum-
ing it happens three
times over the life of the
system

TCO over
expected life

$93,000 $60,000 Assuming a five-year

life span

Cloud Usage

Rackspace did a survey of 1,300 U.K. and U.S. companies together with the Manchester
Business School regarding their cloud usage.

The study found that 88 percent of users of cloud computing have pointed to cost savings
as the determining factor, and 56 percent of respondents agreed that cloud services have
helped them boost profits Additionally, 60 percent of respondents said cloud computing
has reduced the need for their IT team to maintain infrastructure, giving them more time
to focus on strategy and innovation. And indeed, 62 percent of the companies that have
saved money are reinvesting those savings into the business to increase headcount, boost
wages, and drive product innovation.