The Real Cost of Your Cloud Migration
Cloud migrations are complicated, and costs can range from $5k to $100k+. But why such a wide range?
If you’ve read our previous blogs, 9 Things to Consider for Your Migration and 8 Ways to Screw Up Your Cloud Migration, you know how complex these projects can be. Migrations involve many moving parts (data, storage, training, etc.), all varying by business and budget.
So how do you keep costs in check? And what hidden expenses should you watch out for?
By the end of this blog, you won’t just have answers – you’ll have a clear breakdown of what to expect and how to move forward without breaking the bank.
Why Migrate to the Cloud?
There are two main benefits: cost savings, and increased scalability. Companies can save up to 20% annually by cutting down on physical hardware costs. With everything digital in the cloud, you can easily adjust resources as needed without the need for costly hardware investments. This flexibility is what we call scalability.
However, to realize these benefits, you’ll need a plan. While the cloud can save you money, a poorly budgeted migration can do far more harm than good with some companies wasting upward of 32% of their migration budget due to improper budgeting. But with the proper know-how, planning, and expert help, you can avoid these pitfalls and make the most of your migration.
Tools For Estimating Cloud Migration Costs
Before diving in, major cloud service providers (CSPs) offer helpful tools to help estimate the cost of a coming migration.
Here are some tools we recommend:
Microsoft Azure: This calculator categorizes its services so you can find exactly what you need, with understandable examples that illustrate the migration process.
Google Cloud: This tool offers a highly searchable database with current pricing estimates displayed as you make selections.
Amazon Web Services: AWS’s calculator provides pricing for both new and current customers, offering transparency while suggesting the most cost-effective solution for your needs.
While these tools are helpful, they can be highly technical, especially for those unaccustomed to the complexities of a cloud migration. That’s why you should partner with an IT pro to clarify your migration and get you on the right track.
Moreover, while these tools are great, you’re going to need a much deeper understanding to create a proper budget. Starting with…
Infrastructure
Most of your cloud expenses will come from the infrastructure – the core components that make up “the cloud.” This includes things like the virtual computers you rent and the fees charged by your CSP.
The Direct Cost
First, you’ll need to budget for your new cloud setup costs. While straightforward, it will take considerable time and research to explore your options (AWS, Microsoft Azure, Google, etc,). Once you’ve chosen a provider, you’ll be charged based on subscription and pay-as-you-go services. With careful planning and budgeting, these costs can be manageable.
We know not everyone has the time to dig into every option – it could take months to choose the right provider. That’s where we come in. As an expert managed service provider (MSP), we have the time, expertise, and experience to help you select the best cloud environment for your business, all while sticking to your budget.
The Hidden Cost
Most hidden infrastructure costs arise from failing to evaluate your needs properly. As mentioned earlier, companies can easily go over budget by paying for unused resources due to over-provisioning. That’s why you must establish a system that continuously monitors your cloud usage and regularly audits your licenses, so you don’t lose track of what you’re paying for.
If this sounds like a lot of work, that’s because it is. Again, this is where enlisting an MSP becomes essential. We have the tools and experience to continuously monitor your cloud environment and can keep your expenses in check. Instead of worrying, let the pros handle it for you.
Data and Application Transfers
Moving your data to the cloud can be a long and arduous process that requires significant planning. Here, we recommend implementing strategies like the 7 Rs to help categorize and plan your migration efficiently.
The Direct Cost
Cloud providers typically charge based on the amount of data being transferred – a standard across major platforms like AWS, Azure, and Google Cloud. The more data you move, the higher the cost.
Additionally, each migration strategy comes with its own price tag. For example, rehosting is relatively inexpensive since it involves minimal effort to move applications and data into the cloud through this method. On the other hand, refactoring is far more costly due to its complexity. This is why you need to evaluate the best strategy for each application early in your budgeting and planning process.
The Hidden Cost
Moving to the cloud doesn’t just involve paying your cloud provider; it also impacts your internet usage. Transferring large amounts of data requires significant bandwidth, which can increase your internet service provider (ISP) bill. Additionally, where your cloud provider’s servers are located and how fast they can transfer data play a big role in costs. Severs closer to you and faster transfer speeds mean lower expenses and quicker migrations.
You’ll also need to account for downtime during the transfer. Some apps may be unavailable while migrating, and as we’ve discussed, downtime is very expensive. We recommend minimizing these costs by scheduling transfers during off-hours or starting with applications that can afford temporary outages.
Training
Transitioning to a new environment isn’t just about new tools; It’s also about making sure your team can use them effectively. After all, not everyone is open to change. With something as significant as a cloud migration, it’s important to keep your team up-to-date and fully trained. In fact, organizations that utilized Google’s cloud training program saw a 20% boost in employee productivity and a 15% reduction in turnover. Investing in training now is vital for the long-term.
The Direct Cost
To get your team up to speed, you’ll need a training program. Options include third-party training courses from your CSP, a team-lead demonstration, or a hybrid approach that combines external courses with internal guidance. Costs will vary based on the method you choose, so it’s important to consider your team’s learning style – do they learn better with hands-on training or prefer guided videos? Only you can decide what’s best but aligning the training method with your team’s preferences will make the transition smoother.
The Hidden Cost
Training should not be a one-time event. Your cloud environment will continue to evolve with new versions, features, and updates, that cloud leave employees unprepared. Whether it’s a regular refresher course, a workshop on new features, or self-paced modules, ongoing education can prevent confusion and help your team stay productive with their new tools.
Security and Compliance
CSPs operate under a shared responsibility model: they secure the cloud infrastructure, but you’re responsible for securing everything that you put into it. This includes managing user access, protecting your data, and maintaining regulatory compliance.
The Direct Cost
Investing in security features like multi-factor authentication, encryption, and antivirus tools requires both time and money. The cost will depend on the amount of data you’re protecting, and the level of security needed. However, we all know security software doesn’t come cheap, and cutting corners can lead to serious risk.
This is where, yet again, an MSP comes in. Along with all the previous benefits, security features and compliance assistance are all part of its flat-rate fee. That means you won’t have to find, download and manage critical security software all on your own. Instead, an MSP will keep you in budget while maintaining solid security and peace of mind.
The Hidden Cost
Neglecting compliance, skipping regular audits, or failing to implement strong security measures can have serious consequences. Noncompliance fines, data breaches, and ransomware attacks are all costly risks that can arise from inadequate security.
Post-Migration
Setting up your cloud environment is only the beginning. To truly make the most out of your new environment, you need to continually monitor performance, adjust configurations, and scale your resources as needed.
The Direct Cost
Beyond your subscription fees, you’ll need to budget time for regular maintenance and audits to keep everything running smoothly – tasks an MSP excels at.
As mentioned, with a flat-rate fee, an MSP can help you research providers, monitor your spending, and manage security. Even after the migration is complete, an MSP’s role doesn’t end. With ongoing monitoring tools in place, it only makes sense that an MSP continues to oversee your cloud environment. The direct cost post-migration can be as simple as your MSP’s flat-rate fee.
The Hidden Cost
Overlooked maintenance and inefficiencies can lead to unexpected expenses. For example, you might pay for excess storage you no longer need or forget to remove a license from a former employee.
It’s like that streaming service you signed up for a while ago – thought you needed it, but now it’s just sitting there, costing you money. Before you know it, you’re paying for things you aren’t using. But with an MSP keeping watch, they’ll catch these excesses and cut them out before it’s too late.
Your Cloud Migration Checklist
As we wrap up our cloud migration series, we want to make sure you’re equipped with a clear, actionable starting point. While we’ve covered a lot, this tailored checklist distills the essentials to help you kick off your planning process. If you have any questions, don’t hesitate to reach out – we’re here to help!
Download it here!
About The 20 MSP
As a leading provider of managed IT services, The 20 MSP serves thousands of businesses nationwide, providing each one with white-glove service, secure and streamlined IT infrastructure, and 24/7/365 support. We believe in building lasting relationships with clients founded on trust, communication, and the delivery of high-value services for a fair and predictable price. Our clients’ success is our success, and we are committed to helping each and every organization we serve leverage technology to secure a competitive advantage and achieve new growth. To learn more, visit the20msp.com.
