While the scalability, flexibility and efficiency of cloud infrastructure yield undeniable benefits, there are some rather large pitfalls that must be avoided with Cloud Agreements. The complexity of dynamic consumption, broad range of providers’ features and its workload applicability, are challenges to recognize early on to capitalize on your cloud investments and avoid value leakage along the way.
Generally, any and all of the scenarios below are encountered by our corporate clients during their cloud lifecycle:
- Early stage: You are at the start of your cloud adoption and unsure if an enterprise (or ‘ private pricing’) agreement is the right step. How much should I commit in terms of cloud spend ? For how many years? Should I go direct to a provider or use a reseller?
- Middle stage: You already have an enterprise agreement, and your team has built advanced knowledge of cloud technologies. You plan now to embark on a large cloud migration with complex and critical applications (e.g., database, mainframe). While you are satisfied with the current provider, you sense It may be time to explore other alternatives, but unsure if a multi-cloud environment is the right approach. Similarly, you are experiencing cloud spend that far outpaces your original projections and wonder if there are viable options to address the mismatch.
- Advanced stage: You have substantial spend in cloud (ARR>$10M) with a multi-year enterprise agreement and most of your workloads are already in the cloud. You are also at an inflection point, in the process of adopting Kubernetes and expanding your usage of data analytics with SaaS such as Databricks or Snowflake. With such a shift in spend and adoption, you wonder if the current supplier is the right one for the future. Lastly, you are also worried about potential lock in the upcoming agreement renewal.
These are but a few of the many scenarios our Clients must manage to stay ahead of their business objectives.
At NET(net), we negotiate cloud infrastructure agreements every month with each of the major suppliers: AWS, Microsoft and Google. Our experience has taught us practical insights on how to prepare for, and identify the best negotiating path to ensure you end up with the most favorable contracts that extend:
- Custom discounts
We know what these providers will agree to, what they won’t, which then guides our optimal negotiation approach. Rather than focusing on the unachievable, we specialize in getting all the value available to each client in an efficient manner. Regardless of your current stage in the lifecycle outlined above, we can help you get a great deal, much faster than you would “do on your own”. Cloud Infrastructure negotiations are often complex and time consuming, even more so if you are taking a multi-cloud approach.
With our Cloud Cost Optimization (CCO), we could also help you understand your current and future usage with deep analytics both holistically and down to the workload level. We can project what your workload and related spend will be once you have migrated in the cloud, so you can choose the most cost effective instances for specific needs. Answering questions such as:
- What are your CPU requirements?
- Storage requirements?
- Reserved Instance, On Demand or Spot Instance Pricing?
- Do you know which options are best for your environment
If you haven’t modeled the configuration and the workload, how could you know exactly what parameters you need and how to choose the best option? Net(net) analyzes and optimizes cloud spend for our many clients, each with different consumption patterns, operating environments and at different stages in their cloud adoption. With that insight, we help them optimize their spend and determine the optimal projections for an enterprise agreement with their chosen cloud provider(s).
The more you know about your consumption, your future roadmap, its benefits, and your range of commits, the better armed you would be to negotiate your agreement.
If any of the above scenarios sound like your situation, we can help! Please contact us to schedule time with a NET(net) Subject Matter Expert.
Founded in 2002, NET(net) is the world’s leading IT Investment Optimization firm, helping clients find, get and keep more economic and strategic value. With over 2,500 clients around the world in nearly all industries and geographies, and with the experience of over 25,000 field engagements with over 250 technology suppliers in XaaS, Cloud, Hardware, Software, Services, Healthcare, Outsourcing, Infrastructure, Telecommunications, and other areas of IT spend, resulting in incremental client captured value in excess of $250 billion since 2002. NET(net) has the expertise you need, the experience you want, and the performance you demand. Contact us today at firstname.lastname@example.org, visit us online at www.netnetweb.com, or call us at +1-866-2-NET-net to see if we can help you capture more value in your IT investments, agreements, and relationships.
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