Cloud bills can often come as a huge shock to CIOs and CTOs. A large cloud bill is likely the result of two things: the nature of the cloud itself and the lack of oversight in IT purchasing.

Why it’s so difficult to control and predict cloud costs

It’s no secret that with each new product or service you add to the cloud, it adds to a growing cloud bill. The cloud makes it easy to deploy these services, and at the same time it makes it easy for members of your team to make changes to cloud applications without much input from the IT team.

It’s also easy for these applications to go forgotten when they are no longer needed  while  continuing to accumulate as expenses in your monthly cloud bill.

Below are common reasons why your cloud usage bills may be larger than expected:

1. No autoscaling or misconfigured autoscaling

Autoscaling is a common cloud computing feature that lets you automatically scale cloud services based on certain parameters such as traffic and utilization levels.

If configured properly, autoscaling helps lower cloud bills, especially if your entire infrastructure is hosted on the cloud. This is because most cloud providers charge users based on total usage rather than maximum capacity.

Meanwhile, misconfigured autoscaling can lead to inaccurate forecasting and added cloud costs. Oftentimes, if cloud usage is not forecasted properly, companies are forced to pay for on-demand capacity, which is more expensive than reserved capacity.

Reserved computing capacity is a great option for companies who have predictable computing needs and are able to plan for that usage in their IT budgets.

Therefore, you can arrange to pay in advance and take advantage of reserved capacity pricing if your forecasting is accurate — but overspending can occur if there are errors in managing and forecasting cloud usage as it relates to autoscaling.

2. Limitations in reducing cloud waste with just tagging cloud resources

Taking control of your cloud costs typically starts with learning where you’re spending your money. Many companies use tagging as an effective method to track cloud usage and to figure out where their cloud waste is coming from.

While you can assign specific tags to trace costs back to a particular application, system, or service (or even a team like your product and engineering team), tagging can get complicated. The more complex your infrastructure is, the more difficult tagging cloud resources can become.

For many, the time-consuming task of tagging might not seem worthwhile. Furthermore, while you may be able to analyze cloud usage, you’re missing out on other important visibility data that can explain cloud usage patterns and other sources of cloud overspending.

Why advanced monitoring and cost intelligence matters

A way to access such important visibility data is through an automated monitoring system, whether that be in the form of a cloud management platform or cost saving tool.

Primarily, you are getting comprehensive cost visibility into how your business is using different cloud services and how much  you’re spending on each service. You also get access to real-time data on cloud usage, anomaly detection, and also cost control recommendations.

By receiving alerts when there are anomalies in your cloud usage or cloud spend, you and your team can take actions before it becomes an issue that leads to a large monthly cloud bill.

A better way to forecast cloud budgets

Cost intelligence and cost visibility also means not having to worry about future costs. Predicting cloud costs accurately can help businesses avoid any surprises in  their monthly cloud bills.

A recent State of FinOps Report 2021 revealed that many FinOps teams “still rely on tried-and-true data collection, collation, and analysis via spreadsheet.” Their biggest Excel use is for forecasting.

Instead of building forecasting cloud budgets manually and having to interpret such reports to save costs, use a tool with built-in forecasting abilities.

For example, Grumatic offers a Smart Purchase Planner that lets you simulate different scenarios  by applying discount plans or certain recommendations in order to see what your next cloud bill would look like.

Avoiding high cloud bills

As mentioned, tagging cloud resources and processes is a time-consuming task that takes valuable time away from other important development and business goals.

Managing cloud costs can  enhanced with the use of a cloud cost management tool so that you’re getting the right data and insights as they relate to your actual cloud usage and costs.

Cost intelligence data and greater visibility into your cloud is what powers such platforms, so the better data is collected and presented, the stronger the cost management tool is.

Learn more at grumatic.com and us a try!