Cloud computing vs On-premise computing: Understanding the Financial Requirements

Shifting to an operating expense model with cloud computing

Task:

The financial requirements for the cloud computing model are different than the financial requirements for an on-premise model. Cloud computing shifts budgets to a pure operating expense model, whereas the traditional on-premise computing model requires both capital and operating expense allocations.

Several free calculators to help estimate the cost of cloud services exist on the web, including the AWS Total Cost of Ownership (TCO) Calculator and Azure TCO Calculator. Alternatively, you may find other calculators to estimate your cloud cost. Most cloud providers have their own cloud cost estimator tools. If the calculator that you selected does not show on-premise data, then you can recalculate using one of the other calculators that do provide this data.

For your economic analysis, enter the information from BallotOnline's IT Budget and Infrastructure Summary into your chosen calculator to estimate TCO for the current physical IT infrastructure configuration. Then estimate TCO for a comparable configuration in the cloud to estimate the potential cost savings.