Over the course of the past few years I have had an increasing number of discussions with customers and prospects, who already have hosting infrastructure but are considering moving to a real IaaS solution based on a monthly subscription fee. In most cases these customers, who are often in the SaaS industry or offer professional IT services, are interested in moving from on premise or colocation to cloud (virtualized cloud solutions), usually a private cloud due to legal, security, or performance restrictions. The intention of this change is to reduce costs and free up time to focus on their core business.
Customers looking to make the move to the cloud usually either still have racks in the basement of their office, or infrastructure hosted in a data center where the customer rents one or more colocation racks. In both cases, it is possible to make a solid business case for the shift, even it means that the infrastructure needs to be moved from the office to a data center, or from one data center to another that offers hosted services.
To make a strategic move from colocation to cloud, it’s important to have a solid business case. What always surprises me is that the first version of the business case, often only accounts for the CAPEX of the hardware, the cost for rack space, and the cost for internet traffic. As I have learned from working with hundreds of companies, this isn’t enough. To draw up a fully developed business case you need to consider the following points: