Executive Summary
The cloud infrastructure industry is changing constantly. As the Infrastructure as a Service (IaaS) market gets increasingly competitive, price changes are common. For example, Amazon EC2 alone has changed its prices 44 times since 2006. Although other benefits are associated with cloud infrastructure, the low upfront costs and inexpensive payments for servers attract a large segment of customers and are always mentioned as major incentives for cloud adoption. It is important to understand provider pricing in this industry to make informed decisions on IT spending optimization.
Estimating Cloud Spending
When considering cloud infrastructure total cost of ownership, businesses should ask the following questions:
- What should the size of my virtual machines (VMs) be?
- How many VMs of each size do I need?
- How long do I want to be committed to this cloud provider?
- How many peripheral services on aspects such as storage, security, scaling, etc. am I looking for?
- What discounts are available to me?
Since pricing models vary across cloud providers, the above factors should be considered when estimating and comparing cloud prices.
About the Pricing Report
The IaaS Industry Pricing Comparison is intended to provide the tools to understand cloud vendor pricing, resulting in informed purchase decisions.
The report takes an objective look at each of the listed 10 providers’ VM prices for different server configurations over time. Term and volume discounts for some providers are also explored as well as block storage prices for different block sizes. Before the price comparisons, a section on the common pricing structures in the industry is provided, as well as an introduction to the cost comparison describing the methodology.
Price comparisons are broken down into hourly, monthly, annual, and 3-year pricing to gain an accurate perspective on each provider’s pricing strategies and advantages across different durations. The Pricing Comparison does not account for performance factors, rather it assumes equivalent performance among providers: e.g., one DigitalOcean core is equivalent to one SoftLayer core is equivalent to one CenturyLink core is equivalent to one Amazon vCPU etc. Price-performance analysis, which compares VMs from a value perspective, is covered in Part 2 of this report series. For more information on obtaining a custom price or price-performance comparison, please contact Cloud Spectator.
All data in this report is accurate as of January 1, 2015.
Key Findings
- DigitalOcean, Microsoft Azure and SoftLayer in general provide the lowest prices.
- SoftLayer remains the least expensive provider for larger Windows offerings over different term lengths.
- Rackspace’s SSD block storage and CenturyLink’s Premium block storage are the most expensive block storage offerings, but can provide more value to the right type of users.
- Microsoft Azure’s block storage offering is the most inexpensive.
- Microsoft Azure block storage employs a non-linear pricing model, which charges lower unit costs with higher storage volume.
