Cloud Computing Isn’t as Cost Effective as Hoped. So What’s Next? | WSJ Tech News Briefing
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- čas přidán 7. 07. 2024
- Countless companies have migrated their data storage and computing needs to the cloud in recent years, in part to save money. But now many tech leaders say the investments have yet to pay off.
WSJ CIO Journal reporter Isabelle Bousquette joins host Zoe Thomas to discuss how cloud-computing costs got so high and how companies are changing their strategies in response.
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The two reporters have obviously never tried to buy and/or maintain their own server racks. Make no mistake about it. Demand for cloud-computing may have dropped because of the distorted economies of the recent pandemics. But, as companies have to deal with increasing amounts of data, increased privacy and security requirements, remote work, etc., eventually everyone will be forced to migrate to the cloud. Infrastructure-as-code, deployment-as-code, on-demand infinite scalability, serverless computing, automatic disaster recovery, amazing AI tools, and thousands of other mind-blowing features will become essential once people learn about them.
Zoe isn't the sharpest tool in the shed. I usually skip a post if she did it.
Even if the big four are forced to quadruple fees due to energy costs rising? Cloud Ransom will be a term in 2024
@@Spectoral_on_SPOTIFY So cloud fees will quadruple due to energy costs, but hardware and other IT costs necessary for in-house infrastructures won't be increasing by similar amounts? In terms of security, I think businesses that are resisting the move to the cloud today could be precisely the ones that are willing to stretch their IT investments as much as possible by running outdated servers and desktops, and compromising on security to save money. If you do it properly, I think it is extremely hard to beat the security that the cloud can offer... JMHO
agreed, zoe is brave or foolish as she tries to distill truth without sufficient knowledge & experience; I imagine that her work would mislead/misinform the naive.
They will never learn it atall
as you never learn to implement the energiecosts of those clouds and the schooling fee to learn bigdata and working with datanetworks...
cloud computing is never cost effective. you're paying more to gain flexibility. you're transferring the risk of overshooting capex to the cloud provider. lowering risk costs cost.
Okayyyyyy
It's slow
Not true, though costs can spiral for immature slow moving orgs using old IT processes.
elasticity is key to cost savings. maintaining the same usage pattern will never fly
Not true, but ok.
Its not about cost savings only. Its about outsourcing maintenance and upgrades and getting rid of as much annoying slow in-house IT as possible
Well being able to do that also saves cost.
But than the fortune500 CTO doesn’t have a reason to exist. So they keep both 🤷🏻♂️
That "annoying slow in-house IT" also knows what the hell they're doing to prevent you from being compromised. Have fun going the way of LastPass.
Cloud just means that you are handing off the hardware and staff costs but no longer have control over it. You cannot haggle the prices with Microsoft can you? Our costs went up some 2X since 2015 and so we have actually returned our SQL systems back in house and have cut our IT costs by around 25% that is a huge sum for us. What we came up with is a creative method to shove as much as possible in to as little hardware as possible we came up with the name Condenser Method. So far it is working great for us, I guess it's just a Hybrid model but we found ways to do so with as little hardware as possible. We now plan to try our hand at scaling this up so that around 50% of our footprint is cloud and 50% on site but with very few pieces of hardware. So far so good.
That reporter at 1:04 doesn’t have any idea what she’s talking about. She’s pulling out hollow statements from the air without having spoken to a single enterprise owner. This is the the journalism you get when you go to ape school. Cloud isn’t for cost saving, but to increase efficiency of data storage & transmission.
i literally cringed as well
All certified cloud professionals gather here and reply 😂
Listening to this sounds like two people talking about something they have they have not the first clue about.
Exactlyyy
This is really misrepresenting the true benefit and value of cloud-based computing systems. Cost is only one part of the equation. But I would also argue that, for small / mid size companies, cloud computing is not only easier to setup and maintain than on-prem setups, but indeed actually a lot cheaper. The part of the headline saying "So what's next?" is really misleading, as if cloud computing is just a trend and not sustainable, which would be a completely wrong take.
Especially with GCP for small businesses. It is super easy to get an online business up and running using App Engine. This is not a trend that will go away.
Its easy and CHEAP to start, but it becomes prohibitively expensive as years pass by, not to mention cunning vendor lock-ins.
Why does Isabel, a professional, sound like my teenage daughters giving a school report? Lol
It was more painful to hear her speak than whatever is happening to the economy 🥲
The vocal fry, if an acquired affectation, should be dropped.
She sounds like a valley girl. Its Ok to me but I am sure that's not her natural speaking voice.
I think this misrepresents the entire story about cloud computing. As a small-mid cap organisation, the cloud allows developers to be much more productive than before. In Google's state of DevOps report - year on year - it shows that most high performing teams depend on the cloud for autonomy and resource management that would otherwise require specialist skills to do so.
Cause google wants those companies with no specialist workers locked into google's infrastructure, all the while profiting off those companies as well. It's so weird when people act like a company talking up it's own product is evidence of literally anything. What did you think they were gonna say? All those companies are better off not using the product google sells them and if they invested in their own computing we'd be out of a job? Yeah right.
True that
so more productive at releasing "features" that don't matter or bring any value
Of course Google will release a report that is favorable to the cloud. They're a cloud provider.
Big pharma also funds their own studies and clinical trials. Gee, I wonder why? I'm a server admin and cloud engineer. I can state as fact that the cloud is way more expensive than owning your own HW. I've seen the bills.
It's the whole rent vs own debate. Only case where cloud saves you money is for variable loads. Black Friday is perfect example, which she cites.
let me guess, some genius decided to moved all VMs to ec2 and called it “migration”. somehow people are still stuck in the past where they still "buy" servers from cloud providers and use it 24/7 without utilizing the elasticity of things and ended up needlessly paying for unused resources.
Ding ding ding ding! This video is a joke, there is no way buying and maintaining your own servers is cheaper and more efficient in the long run than cloud. These companies without a doubt are misusing/paying for cloud resources they don't need.
bingo!
Right -- when virtualization was new, we replaced all our physical servers with virtual servers. Then with the cloud, we swapped out all those same virtual servers for cloud servers. So we have the same mess, with the same number of statically defined, manually managed, underutilized servers -- but in the cloud. Mission accomplished! It's not until you fully embrace cloud based load balancing, horizontal scaling, and elastic provisioning that you actually see any meaningful benefits. ... But that requires a full rearchitecture and rethinking of your "server" deployments. Also, is it cheaper? well.. no, not if you're going to keep the same staff of systems administrators manually ssh'ing into the severs and running updates as though it was still 2005.
These reporters have no idea what they’re talking about.
The best part of this video is when the interviewee stops talking.
😂😂😂😂
The future of cloud providers comes down to hybrid infrastructure. If it's public/web facing, put it in the cloud. If it's internal, keep it internal. Hybrid cloud is the only sensible and cost effective solution imo. You need to draw the line as a sysmin between internal infrastructure and public facing cloud infrastructure.
When I saw this video, I came Immediately to the comments to see what my fellow Cloud Engineers were saying. Cloud Computing will forever be the future and there's no other way!!
so, Buying Thousands of Server, set up the server in 50 different countries, and
hire Thousands of people to maintain the server manually is more cost effective then?
the goal is not for saving money or to be Cost effective,
the goal is so that you don't need to deal with the headache of managing your own server hardware.
At this rate, i'm questioning about the capabilities of those CEO.
because they're willing to do everything to cut cost & corner
It about outsourcing so that you can put more resources elsewhere.
I highly doubt cloud computing will go away with benefits like that especially to smaller businesses.
@@silverhawkscape2677 yes, exactly.
Cloud computing is a godsend, it enable you to focus your resources on the thing that matter
Yeah, those executives,
they will cut their own life support if it could reduce their cost.
@@IOFLOOD That is a half truth. They may not get the big business discounts, but that is a "cloud vs discount cloud service" comparison. Not "cloud vs on-premise" comparison. Small businesses still benefit far more, especially at scalling, than an on-premise set-up.
The vision of 'what cloud is' that is shared in Isabelles perspective is cloud as it was being presented to CIOs over 10 years ago when I started selling managed hardware in hosted data centers.
It wouldn't shock me to know that executives who are still at this level of cloud maturity aren't seeing gains. It would imply that they've been organizationally unable to adapt to the (insert dev/fin/rev etc.)Ops shifts that have emerged almost every 2 years since that point.
Maintaining the scale and security to meet enterprise demands in a 'cloudless' world would have had massive implications on the US economy when we had to turn on a dime to a WFH first existence. Imagine, if instead of having to rationalize cost increases in a pandemic era tectonic (techtonic?) shift you had to shut down operations while waiting for procurement teams to complete in what was a literal shortage of GPUs and other critical components. If you weren't a market leader or VC darling good luck. The result of there not being a hyperscale to absorb those shortages would have resulted in many medium sized tech companies closing doors the way mom and pop service sector businesses did.
This deserves an alternative take from one of the many CIOs in the F500 who know that minus their cloud partnerships COVID would have set them years backwards.
What you say is fear mongering to justify absurd cloud prices and sly vendor lock-ins. Cloud has turned into a blood sucking trap now.
computing in the cloud is cheaper than storage. Now companies are realizing that with large storage they are currently paying heftily for storage vendor lock-in
Maybe this wouldnt be the case if they had adapted their internal teams to this new OPEX model. I am literally helping companies save thousands of dollars with basic improvements in their strategy. This video is missing the point of cloud and is definitely wrong about cloud being more expensive.
Agree here. You have to reorganize your org around new native cloud models to maximize savings and the power offered by managed CSP services. This video is a very simple analysis and not nuanced at all. I have driven huge savings at companies over last 10 years. It's not the future, it's now. The massive surge is only getting started. If you don't manage and secure it well, immature old IT shops will get burned badly. Native cloud startups have more than shown the value of the cloud. Larger enterprises have to move to more agile processes and break down barriers. Things like self serve can speed up develop cycles incredibly offering huge value. Changes that took months can be done in days.
Nice work! It’s good to save people money, do you know any books or resources I can use to save my company money?
the isabelle woman talks exactly like summer from rick and morty
For a small business, it's way cheaper than us buying a rack and servers and managing it all. Half as cheap.
Its cheap only when you consider initial costs. But over 5 years, you would have paid more for cloud than on premise.
Cannot believe that this conversation is endorsed by WSJ where the two speakers obviously know very little and have a rather shallow experience from handling cloud projects. It's not because you've read a few books or talked to a few folks that you are a cloud expert...
the only cloud resource we use is the VM, just so that we have different environments we can deploy our code, that's it, also some Cloud services you need to add code to your application, and thus locking your app to that provider.
No Matter if it is On-Premise, Cloud, or Quantum computing, as long there is no technical evaluation and placement of the right individual, as long as "good enough is great" culture exists, no matter where the application is, it is going to not achieve its targets.
The biggest thing cloud does is offload operational risk and availability. If you have to change your application to “adapt to cloud”, now you have platform lock in and unnecessary architecture changes. They can technically host auto scaling fancy clouds of their own if they wanted. They don’t need AWS or Azure or GCP. For larger players, offloading operations risk is the biggest reason.
Why are costs higher (for some) after moving to the cloud? Because they refused to listen to advice.
You have to optimize your applications for the cloud or you will waste money. Also, small scale intranet apps rarely need the cloud. However, if you do need it at least use "serverless" cloud infrastructure for those.
When it comes to technology and new concepts, I always refer to the words of my grandfather for guidance: "If it ain't broke, don't fix it."
Unfortunately that's not how capitalism works. It works by continual growth and working yesterday does not mean it will work tomorrow.
Dear Henry,
Thankyou for this automathingamajiggy but i have no use for it, just give me a faster horse.
Sincerely
your Grandfather
Don't we love the headline generalizations? The Majority of CIO's oversee IT only and IT is disconnected from the rest of the business. The rest of the business is developing in the cloud on their projects/products that are the ROI on the company. If we are talking about cost controls then as a generalization those business units are not focused on, or don't really care about cost controls, just about time to market. The tools are in place that make cloud computing very low cost and economical, but business need to actually use them and use them correctly.
There's just no way it would be cheaper to do it yourself and get as much as you do with cloud.
A foundation can also be a boat anchor. If one gets married to CapEx, then they organize their entire IT strategy around this. If one can accurately forecast everything, then on premise can work and be cheaper. BUT... failure on this will result in going over budget abd other issues of complexity of ownership, including dependence on a local IT labor force.
I think part of this is the dire need of management to justify RTO and prepandemic facility planning and utilization.
I manage a large IT budget for a mega corp and we're actively trying to move to the cloud. The impetus for us however isn't exactly cost saving but a simplification of lifecycle management and an elimination of our technical debt. We do this by shifting from capital intensive investments in servers and data centers and moving towards an opex model. Moving to opex doesn't necessarily make things cheaper but it allows to to outsource lifecycle management for global infrastructure and avoid having to find capital to invest in assets that are fully depreciated on off our books.
Can you expand on this - how is it worse to find capital for servers? I mean rather than pay the cloud fee - you could get a loan for the capital required and depreciate it on your taxes.
I totally agree with you! But I always wanted to understand the really core reasons.
So they just us cloud services for short-term revenue in their books so their CEOs will please their shareholders?
Lots of cloud engineers in the comments disagree. What you guys need to understand is that the skills to optimise cloud are extremely rare. Most firms are struggling with management that has no clue, processes that are prohibitive, users that are not sure what they want and cloud engineers that are not the best. This all while vendors sell cloud as if it will be a plug and play kind of technology which is very misleading.
Usually this is due to anti-optimal cloud strategies by too many companies.
Cloud is simple "Junk in Junk out". Most of these companies didn't modernize or implement well architecture framework. They had junk running On-Prem and they decided migrate all of that junk as is to the Cloud. Companies that have seen value in migrating to cloud have fully embraced cloud and modernized their work processes for Cloud. Running your own data center in this day in age is unnecessary, you can't even match single instance SLAs that the cloud providers offer.
The talk is completely tangential to video description 😂
😣 these reporters really need to do their research.
Isabelle the Valley Girl.
Listening to vocal fry is horrific
Clickbaits are effective but channels like WSJ using them feels unethical. Being from tech background I had interest in this video but the reporters do not seem to understand exactly what they are talking about. Its more like they read excerpts from tech journals or articles by CTO's, came out with a theory of their own and recorded the video.
what the f is with this no video video, you guys sound like two neighbors having a chat about something new in town
simple reporting, give us an examples, not "companies". give me a number not bunch of fancy word.
Almost always seems like everything is overhyped and under delivers. Can't wait till we have something that would depend on even more so fail to deliver eg. Electric cars, wind power, etc.
👏 Good job world governments
CONGRATULATIONS 👏 FOR ORGANIZING SUCH A WONDERFUL EVENT
CIOs got lazy with 100% cloud mandates without doing their homework, and it was hip/easy button. Never smart to put all your eggs in one basket. You need multi cloud + hybrid if you’re a large org and need cost savings
Data Mesh or data virtualization is the next phase!
THX Green
Isabelle talks like she's a slightly grown high school airhead. No offense but difficult to look past and focus on the actual story. Kept having flashbacks to when my sister was 15 and all her annoying friends. Maybe it's just me 🙂
Was looking for this comment 😁
@@vipergx LOL yep, was thinking "okay good content but I'm not sure if I can bear this; as constructive criticism, she really needs to fix that; I alter my accent/voice for professionalism too--it's not hard.
Thank god I’m not the only one. Or do all Americans speak like this nowadays?
💯
@@martinnolan4332 Definitely not normal Americans--I literally thought it was a joke at first, or very lazy and she would change it
Why is she hoarse and elongating the end of her sentences?
Labor is the real saving and maintainers
The vocal fry is real here… ugh.
Also, I do think we will see people consider on-prem for more and more use cases again.
I had to stop listening because of the vocal fry lol. Can't stand it.
I listen to CZcams videos using high end studio monitors so every grating detail comes through.😬😣 It's actually painful to listen to.
😂🤣😂 - that's how things are nowadays. Painful!
If we had 6g then it could work
Paying rent vs owning the building lol
this is all true when it comes to aws frankly
And also this company is in the cloud.
believe it or not!! it's harsh truth, companies go to cloud just for one and only one reason!!, they can't do the things on-premise.. and software guys don't have those skills, it's sad but true..
who ever is commenting in favor of cloud, ask if he/she can do data engineering in distributed mode at scale on premise? add other tech stack in it too, and all in form of distributed micro services..you will find no one..all love to do nothing, and cloud give that do nothing option..and this is the reason for layoffs, all other reasons like Russia-Ukraine war, restructuring, repo rate bla bla, all are bullshit..
Palantir's foundry is a solution
Embarrassing video, genuinely. I would suggest either taking this down or uploading a follow-up from an alternative perspective.
Misrepresentation. The apps need to correctly optimized for cloud.
next gen will become cheaper
imagine few gen from now
This is just some half boiled report, I have been working as an Cloud Solution Architect for the past 5 years, I have done several projects to clients all over the world and every single one of them is really happy with Cloud solutions, also companies who have migrated from on premise to Cloud infra are really starting to benefit the outcome nowadays!!!
Why not let the guys make the comment. You cannot narrate everything about cloud when you never experience on premise server maintenance like fire drill shutdown. Hardware life cycle. Network connectivity issues like router or switch non responsive. Rj45 cat 6 just don't want to connect. Water condensation that flooded the room.
No this is cap they need to hire a great Cloud architect seems like these people are making excuses.
Finally someone saw it... Cloud is dangerously close a scam! And microservices is just insane!, Translating cloud pricing tables to expected actual costs in complex infrastructures is a Nightmare by design...
Everything will go to the cloud
Isabelle sounds like an elderly smoker she has so much vocal fry!
This is a poorly researched segment.
Was it two bots talking to each other ? It sounded like the google barber thing.
Never was…
This is like a non-gamers trying to talk about video game.
Isabelle Bousquette really needs to stay away from speaking in these videos. Her voice is so grating and hard to listen to. Classic Cali girl drawl
My Gosh, yes! So annoying...
What's wrong with her voice? I am not even a native speaker of English, and still I didn't have any trouble at all understanding every single word in the video. I think that even for non native speakers, both women are easy enough to understand, I just have the impression that what they were actually saying was quite generic and superficial, so the video was not as insightful as I hoped it to be, but at least it was easily understandable.
The voice fry is too grating to listen to.
Most engineers are bad and failing to adapt to cloud environments. That's why they aren't seeing benefit.
Oh man. The reporter talks like a 15 year old valley girl. Like OMG! Totally!
there is no cloud just someone else computer
Please don't get your facts from this video. The discussion in this video on Cloud computing happened between two non-tech people, and they don't know what they are talking.
Cloud computing is the best thing that’s happened and google gives it for free
but why does she say clOAUD like that
omg, like totally likes talking so much and saying stuff as well, like always, right?
How are they journalists ?? What’s wrong with news these days ? For sure WSJ has lowered the bars/standards from what I’ve been seeing on the channel so far.
They ALL need Pepperdata.
CAPEX -> OPEX
LOL wrong headline/title.
So does this mean we should localize storage and abandon cloud servers as individuals?
This is such a shallow analysis, bordering on nonsense. The agility and scalability and speed the cloud enables are huge competitive advantages. Good governance and work to transition old processes is critical to success here. I have been helping companies move fast, securely and cheaply into the cloud successfully for 10+ years and we are just getting started. Certainly companies can over spend without tight governance, but their competition is going to be charging ahead with modernization and new cloud native models that will help them win. The slow pokes will fail and fall away. Amazon won because of their innovative engineering that spawned cloud services. It takes discipline and value driven focus to go well into the cloud. The speed of innovation is incredible. Cloud prices have gone down on AWS since their inception, not up. You have to reorganize your company around the new way of operating to succeed. You have to watch your costs of course, they can spiral and it's easy to open huge security holes with so many moving parts. The cloud isn't for wimps.
Wow, WSJ is actually not realible who would of known...
Bad reporting alert - no understanding of the value proposition of the cloud.
apparently every commenter is an expert
I can tell from her voice she drinks and shouts a lot
Seems that your reporting hasn’t hit the mark.
Was really hard listening to Isabelle on two levels.
1. She was stating odd reasons for cloud drops. Not a tech savvy reporter.
2. That sorority/spoiled child accent. God it is annoying.
The cloud was never cheaper. Its just faster and easier to provision new hardware.
Require fewer engineers. Less risk of downtime. When downtime occurs, shorter duration. Less bugs... Nah man. It's cheaper in the long run
(Edit) also jumping on the hype products and/or using them incorrectly is costly though. AWS EC2 is pretty decent but Lamda's get expensive at scale, Firebase is easy to mismanage and Salesforce anything is a total rip off.
So AWS for traditional server. AWS lambda for cron jobs, file uploads and a few specialty things. Firebase for smaller projects. And Salesforce never
Still better getting virtual/rental servers though. Cloud is for specialized operations OR CEOs whose are want to please their shareholders.
I have already posted a video about it earlier
Omg it's like, thaaaaat things cost money.
this interview is kind of totally misoriented.... is about scalability, availability, focusing in core business value, low upfront commitment, agility to meet business requirements and reach global regions. One of the best examplea i like, is a simple mid size react app, which you can deliver to the world, for millions of users, without much planning just using aws s3 and cloudfront. (let'a not talk ssr ok) hehehe...
That voice so hard to listen to
She should visit a doctor. Something is wrong with her voice
I like it.
The video contains some interesting retrospective about first adopters but it is very very superficial .
Being an IT guy, I was craving for more .
@WhatsApp ±①②①④⑧③⑧⑦⑦④⑨ M. Scammer go play away !
This makes it seem like cloud providers are at fault for poor business/technical decisions. In reality cloud technologies are almost always superior to on-premise alternatives in regards to costs, scalability and fault tolerance.
And with the rise of quantum computers they'll become even stronger
Superficial article. Reality is more complex than what communicated in the podcast . TCO, expenses related to human resources, speed of deployment, opportunity costs, flexibility, and other aspects are not accounted. I would have expected something more from WSJ
you really expect a lot from a 6 minute podcast.
Yeah, but not all workload fits the requirements to save money on cloud. Probably Hybrid is the best way for a few years.
@@Theoryofcatsndogs from the WSJ yes
It must be correctly used. Users must carefully study the costs of each subscription.
Can you not invite this guest in the future. She sounds extremely annoying.
Who will take these girls serious with there sassy accents LOL
Another highly exaggerated marketing buzzword! 🤣🤣