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Get PAYG governance before your employees rack up a huge bill


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Stories about children unwittingly racking up huge bills on apps or downloading in-app content without realising the cost got me thinking about a comparable issue that we come across with increasing regularity in the cloud industry.

The advent of cloud services was heralded by many in the industry as the first truly flexible IT solution that utilised a company’s resource by ensuring that they only paid for what they used. This pay-as–you-go model (PAYG) was already successfully applied in the mobile industry and was easily understood. This made it a viable pricing model for the public cloud services market where access to IT solutions could be ramped up and down as needed.

But it is its simplicity as a pricing model that has caused some users to rack up enormous costs. Never has it been easier for an employee to sign up to cloud services (think Amazon, Google Docs etc.) with a company credit card. Once the employee has access to the service, there is nothing to stop them over-using it or racking up a bigger than expected bill. Just like PAYG mobile services you’re charged upfront for usage but can still incur costs that weren’t apparent at the start. It’s the cloud industry’s version of costly data roaming charges.

While caveat emptor (buyer beware) should prevail whenever you purchase something on behalf of your company, there are warning signs that can alert IT managers that they might run up large bills. Cloud providers that supply quotes online without asking any fundamental questions to understand who and what you are highlights a ‘one service fits all’ approach. Yet there is a big difference in usage profiles (and potential charges) when running intensive databases compared with other usage scenarios. Without understanding the customer’s requirements and then outlining the types of charges that may apply – a true indication of cost – the final bill may be wildly different than the headline web price that seemed so attractive in the first place.

As customers’ awareness of potential unplanned costs grow and adoption rates continue on the upward trajectory, it is important that the cloud industry responds in the same way as the mobile phone service industry has. By putting good PAYG governance in place to protect the user from racking up big bills unawares will help to protect the cloud service provider and industry from a negative perception.

At Redcentric we help customers to understand their likely usage and then use this model to predict what costs they’ll incur upfront. By doing so, we are ensuring good PAYG governance and at the same time providing customers with service that provides the promised flexibility but with appropriate control.



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