CIO OPINION flexibility and resilience. This approach also has the added advantage of avoiding vendor lock-in and allows companies to take full advantage of the strengths of various platforms and promote innovation and improve efficiency.
In addition, the integration of Artificial Intelligence into cloud services is transforming productivity and business outcomes. AI enabled capabilities are becoming integral to cloud offerings and are helping businesses to automate complex tasks and gain valuable insights from large datasets. This trend denotes the beginning of the AI transformation rather than the continued digital transformation.
Organisations that do not incorporate these technologies into their cloud strategies will be left behind in a data-driven and intelligent economy. Although the cloud presents numerous opportunities for transformation, two primary challenges are evident: cost visibility and privacy.
Total cost of ownership
The first challenge is to understand the Total Cost of Ownership. Even experienced professionals at hyperscalers sometimes find it difficult to accurately calculate the TCO of complex solutions that are built on multiple native cloud technologies.
To this issue, more businesses are applying agile approaches, starting with small-scale implementations and gradually expanding the solutions. This approach is not only cost-effective as it also provides value in increments and enables the control of the costs, negotiating the price as the solutions grow, and ensuring that the adoption journey is financially feasible.
As energy costs rise around the world, cloud providers and data centres are paying attention to energy efficiency. Hyperscalers are at the forefront of this transformation as their profitability is linked to energy consumption. Reducing energy usage is not necessary for these providers but also improves their sustainability. Integration with renewable energy and advanced cooling are becoming standard practices among the hyperscalers.
On the other hand, colocation providers often pass through energy costs to customers and standardised rates across certain markets. To differentiate themselves, some co-location providers are investing in renewable energy farms that offer clients lower energy costs while also supporting sustainability initiatives. These efforts highlight the growing importance of energy efficiency as a competitive advantage in the cloud market.
For organisations that want to adopt or grow their cloud strategies to be successful, there are certain best practices that can help maximise success and avoid pitfalls.
Start small
This approach to cloud adoption helps to keep costs under control and avoids overinvestment. In this manner, businesses can gain value in increments, refine their solutions based on real-world feedback, and secure better terms from providers as they scale.
Data governance
Due to the complexity of the issues related to privacy and compliance, organisations need to put robust data
Data privacy
Data privacy concerns is the other challenge. Because the hyperscalers are typically owned by entities in the United States or China, there is concern about the potential for government access to private data. While technical measures like encryption and data residency solutions can be used to address these risks, they bring a layer of complexity to cloud adoption.
Some of these concerns are eliminated when data is stored on-premises through colocation providers, but this eliminates the flexibility and scalability of cloud solutions. These challenges can be addressed effectively with a deliberate and strategic approach that balances the benefits of cloud technologies with an organisation’ s unique cost and privacy concerns.
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