The Dollars And Sense Of Building A Cloud Infrastructure

By Dan Timko, President & CTO, Cirrity

Numerous studies in the media have touted the “savings” of cloud computing. Unfortunately for managed services providers (MSPs) and other resellers, virtually all those savings are seen at the customer level. As customers become more savvy, resellers must invest in powerful, reliable infrastructure, faster network connections, highly skilled technicians, and other attributes of top-quality cloud providers. Building out a true cloud infrastructure can cost millions of dollars, but it is common for small providers to start by hosting customers on a simple virtualized platform. For this reason, we won’t get into the cost of building a cloud hosting environment. A more important question for organizations is, “How much will it cost to build a cloud environment that will meet the needs of my current and future customers?” Making the wrong choices can quickly ruin a firm’s reputation as a quality provider.

Hardware And Software Investment

I have worked with providers that initiated cloud services with only a few servers, hosted as part of their own server farm. They think, “I’ll start small and offer Infrastructure-as-a-Service (IaaS); most of my customers are small and mid-sized businesses (SMBs), and IaaS is an easy service to manage.”

Not only do they end up with an environment that isn’t scalable to meet customer needs (see “scalability,” below), but they don’t invest in data-center grade hardware, don’t ensure sufficient redundancy, and don’t consider the manpower resource they will need to manage it.

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