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Cloud Cost Management Vendor Profile: Yotascale

As Amalgam Insights continues to present independent profiles of vendors in the cloud cost management and optimization space, we next highlight a company that takes an engineer-specific approach. This differentiator takes aim at organizations with a certain level of maturity within their cloud environments, as well as a particular spend threshold. Read on to learn more about Yotascale and to glean Amalgam Insights’ recommendations.

WHY YOTASCALE FOR CLOUD COST MANAGEMENT AND OPTIMIZATION

  • Engineer-specific design for cloud cost ownership
  • Consistent view of cloud costs for all users
  • Normalized and automated tagging for cloud resource tracking

ABOUT YOTASCALE

Yotascale is noted as an Amalgam Insights Distinguished Vendor for Cloud Cost and Optimization Management. A relative newcomer in the cloud cost and optimization management space, Yotascale, founded in 2015, states that it manages more than $1 billion in cloud computing spend across infrastructure, platforms, and software. The Palo Alto-based company targets enterprises and mid-market organizations across verticals including media and entertainment, financial services, healthcare, transportation, and real estate.

These users typically spend at least $3 million per year on cloud computing, as spend below that level is often handled through cloud service providers’ native tools. Yotascale has raised $24 million; its most recent round in October 2020 raised $13 million in B series funding. The company currently employs fewer than 50 people and does not disclose its revenue or client retention rate.

YOTASCALE’S OFFERING

Yotascale started to design its cloud cost management and optimization platform with engineers in mind, followed by cloud operations experts and finance professionals. The company did this to help organizations empower engineers to own responsibility for cloud costs. Yotascale’s perspective states that engineers understand the impact of performance

changes on expenses, so they are ideally positioned to oversee those adjustments. As such, Yotascale built an interface that relies on fewer modules than some other software vendors in the cloud cost management space. In Yotascale, all users have the same view of cost data presented in their organization’s business context (although depending on their role, individuals can view the data through a customizable lens) to prevent confusion among departments. However, role-based access is supported to ensure users only have access to data according to their role, as well as alerts and recommendations that apply to their jobs.

Once configured, the Yotascale software helps normalize tag names across cloud providers and services, and provides automated tagging policies for cloud resources in the organization’s preferred nomenclature. That way, users can see an all-in-one view of their multi-cloud resources as well as containerized workloads across Amazon Web Services (AWS) and Microsoft Azure, as of May 2022. Yotascale has plans to add Google Cloud to its roster, rounding out its coverage of the current market-leading hyperscalers.

Yotascale bases its pricing on a percent of monthly resource hours of services (such as Amazon Elastic Compute Cloud and Relational Database Service), rather than by percent of the total bill. Yotascale offers tiered pricing, typically starting at a cloud usage level of 200,000 hours per month. Standard features and services provided by Yotascale include:

  • AWS/Azure spend under management
  • Inventory of AWS accounts or Azure subscriptions
  • User accounts
  • Billing data processing
  • Cost reduction recommendations
  • Billing data anomaly detection

The base pricing package includes all Yotascale features as well as capabilities to provide insight into cloud carbon footprints so organizations can reduce compute power and support sustainability initiatives.

Prior to launching its application in production, Yotascale works with each customer to create the business context for automated tagging. The process can take as little as two weeks, depending on the end user’s readiness and existing documentation. Installing and onboarding the Yotascale software itself takes less than an hour. Yotascale’s reference customers include Zoom, Hulu, Compass, Lime, Okta, and Klarna. Yotascale sells through its direct sales teams as well as a third-party channel that includes consultants and managed service providers.

COMPETITION AND COMPETITIVE POSITIONING

Yotascale finds that it competes most often against organizations’ internal spreadsheets, as well as first-generation deployments of VMware’s CloudHealth and Apptio Cloudability. Yotascale states that it can reduce cloud computing costs by up to 50% compared to existing cloud cost management efforts. Yotascale states that its customer wins are based on the following: an engineer-specific focus and the ability to assign assets to engineers; its emphasis on tag normalization; its all-in-one views; and data that show how changes will impact performance and cost.

YOTASCALE’S PLANS FOR THE FUTURE

Yotascale next plans to build support for Google Cloud Platform cost management and provide self-service onboarding automation. It also intends to add more integrations as users seek to access existing cost management, billing, and sourcing tools as they consolidate data.

AMALGAM INSIGHTS RECOMMENDATIONS

Amalgam Insights recommends that enterprise and mid-market organizations seeking to empower engineers with cloud cost responsibility and spending a minimum of $3 million per year on cloud computing consider Yotascale. Yotascale is built to support engineers seeking to support accounting requests, tagging automation, and service usage requests for cloud costs that exceed in-house capabilities.

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Cloud Cost Management Vendor Profile: Apptio Cloudability

Doing cloud cost and optimization management well often calls for the help of an external vendor. That’s why Amalgam Insights has been publishing our in-depth series on the challenges associated with running a cloud cost and optimization management practice, as well as reasons to rely on third-party platforms and services for assistance.

With that in mind, Amalgam Insights presents the third of our ten vendor profiles — this one featuring Apptio Cloudability. (As a refresher, the first profile focused on SADA ; the second on Spot by NetApp.)

Read on for our analysis, which is part of our new Vendor SmartList report,Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, available to download after purchase.

THE BOTTOM LINE: WHY APPTIO CLOUDABILITY FOR CLOUD COST AND OPTIMIZATION MANAGEMENT

ABOUT APPTIO CLOUDABILITY

Apptio Cloudability is an Amalgam Insights Distinguished Vendor for Cloud Cost and Optimization Management.

Cloudability was founded in 2011 in Portland, Oregon, to manage cloud billing and usage cost data. It was acquired by Apptio in 2019 to add cloud cost management and optimization to ApptioOne’s capabilities. Bellevue, Washington-based Apptio supports more than 1,200 employees in offices in the United States, London, Sydney, Bangalore, and Krakow. Apptio serves midmarket organizations and enterprises, many of which fall within the Fortune 100.

Across its financial management portfolio, Apptio manages $650 billion in technology budget and Cloudability managed more than $9 billion in cloud spend in 2019 when it was acquired. The privately held company does not disclose how many customers it currently has, its annual revenue or other details including customer retention rates or Net Promoter Score.

APPTIO CLOUDABILITY’S OFFERING

Apptio brought in Cloudability in 2019 to augment its existing technology management capabilities; that strategy includes its October 2018 acquisition of FittedCloud to optimize cloud resources and the October 2020 acquisition of SaaSLicense for Software as a Service management.

Apptio Cloudability comprises cloud computing management and optimization — and, through the separate Total Cost module, reporting and analytics — for multicloud environments, containers, and software as a service (through the SaaSLicense acquisition). The platform is designed for IT, finance, and business teams seeking to manage cloud costs, although the company states that it now talks more with head executives — CEOs, CFOs, and cloud directors in Cloud Center of Excellence groups and procurement — during the sales process.

Apptio Cloudability ingests, normalizes, and structures billing usage data from Amazon Web Services (AWS) and Microsoft Azure. This approach is used on an ongoing basis to continuously improve the economics of running cloud environments with financial operations (FinOps) principles in mind. Apptio Cloudability also delivers rightsizing recommendations for an organization’s cloud environment and AWS savings. Apptio Cloudability sees its users spend the most money on AWS, followed by Microsoft Azure, then Google Cloud. The platform’s savings plans capabilities show users where they can reduce and optimize cloud costs while also forecasting their spend.

Apptio Cloudability sets its pricing on the cloud spend covered under one or three-year contracts. It considers discounts on a case-by-case basis. Apptio Cloudability does not require a minimum number of users or spending. The standard Cloudability package comes with basic help desk and technical assistance. Add-on options include professional services (e.g., building a FinOps practice), training, and certification delivered through the FinOps Foundation. Apptio Cloudability offers optimization and allocation-assistance packages separately; they are priced based on the size of work required. Finally, the TotalCost module is available as an add-on, with tiered pricing based on annual cloud spend.

Through integrations and mapping, TotalCost covers all the major public cloud providers, as well as Oracle, Alibaba, and IBM, and ancillary cloud vendors including Snowflake and CrowdStrike. Cloudability uses TotalCost as a means for helping organizations better grasp all the cloud platforms and services influencing their total cost of cloud ownership, and charge back expenses as needed.

COMPETITION AND COMPETITIVE POSITIONING

Apptio Cloudability states that it wins business for its focus on FinOps capabilities, as well as its savings plans and rightsizing modules. The latter modules provide additional analytics and machine-learning capabilities for clients, allowing Apptio Cloudability to generate recommendations through proprietary algorithms that can analyze as much as 15 years’ worth of a company’s data.

Apptio Cloudability goes to market both through direct sales and through an emerging indirect channel made up of managed service providers and consultants.

APPTIO CLOUDABILITY’S PLANS FOR THE FUTURE

Apptio Cloudability plans to keep investing in providing more detailed optimization recommendations for discounts, developing integrations with cloud data and hyperscaler vendors to support sourcing workflow, and supporting localization, currency, and data sovereignty updates to make Cloudability available in more geographies.

Amalgam Insights expects that Apptio will also invest in capabilities to support managed service providers with improved white-labeling and integration, and to continue developing container cost optimization capabilities for Kubernetes and Docker-based workloads.

AMALGAM INSIGHTS’ RECOMMENDATIONS

Amalgam Insights recommends that organizations, particularly those with multiple clouds, interested in a FinOps focus vet Apptio Cloudability. Apptio should be considered by organizations seeking to control costs and budget resources. Because of Apptio’s history in supporting FinOps as a formal practice, organizations with formal FinOps training or experience should assess Apptio. Amalgam Insights also recommends that organizations seeking to provide additional cloud cost visibility to non-IT executives (such as finance, accounting, and procurement) involved with cloud decision-making and tracking in support of those processes evaluate Apptio.

Need More Guidance Now?

Check out Amalgam Insights’ new Vendor SmartList report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, available for purchase. If you want to discuss your Cloud Cost Management challenges, please feel free to schedule time with us.

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Cloud Cost Management Vendor Profile: Spot by NetApp

As we’ve noted throughout our series on cloud cost and optimization management, choosing a vendor for this practice is no easy feat. A number of companies provide software and services germane to making the most of cloud environments — it’s tough for organizations to sift through all the marketing messaging. Amalgam Insights has taken on much of that footwork on behalf of enterprises, and we continue to present our findings in our series, which includes vendor profiles published in no particular order. This second profile looks at Spot by NetApp.

WHY SPOT BY NETAPP (INCLUDING CLOUDCHECKR) FOR CLOUD COST AND OPTIMIZATION MANAGEMENT

  • Continuous cost optimization, not just one-time, across public clouds
  • Automated platform that reduces burden on operations personnel
  • Includes development, finance, security, and cloud operations based on both in-house development and acquisitions

ABOUT NETAPP

NetApp is an Amalgam Insights Distinguished Vendor for Cloud Cost and Optimization Management. Founded in 1992, NetApp has grown from a premises-based provider of computer storage to its current iteration as hybrid cloud data services company. As of 2021, NetApp employed 10,500 people around the globe, across all of its divisions. The company reported $5.74 billion in revenue in 2021. In 2020, NetApp acquired Spot to gain cloud cost optimization capabilities and enter the cloud cost market. In 2021, NetApp bought cloud financial and operational optimization vendor CloudCheckr, adding those capabilities to its Spot by NetApp portfolio. CloudCheckr reported more than $4 billion in cloud spend under management when NetApp acquired it. NetApp’s cloud cost control and optimization offering targets midsized and large enterprises seeking to optimize cloud costs scaling up to Fortune 500 firms.

NETAPP’S OFFERING

The Spot by NetApp portfolio brings together a variety of organic and acquired capabilities to create a platform that gives professionals in development, security, finance, and cloud operations holistic, cross-departmental insight. The acquired companies include cloud optimizer Spot and cloud cost management solution CloudCheckr. Spot brings expertise in managing containers such as Kubernetes, which can rack up cloud costs quickly. CloudCheckr offers the visibility and governance around cost and security, including the allocation and chargeback of cloud computing costs to specific departments.

Spot shows which aspects of the cloud environment need right-sizing with more than 600 best-practices checks around cost management, security and compliance, usage and performance, and availability. Spot sets parameters to implement and automate recommendations for procurement, finance, security, and IT to all share visibility to the organization’s cloud infrastructure (including containers, virtual machines, data and web applications, and micro-services).

Spot achieves this combination of operational and financial visibility by combining CloudCheckr with its already existing platforms: Eco (for finance), Spot Security (for security teams), Spot PC (for cloud operations), and Elastigroup and Ocean (for developers). CloudCheckr delivers the visualization capabilities and best-practices checks that help assure continuous optimization.

COMPETITION AND COMPETITIVE POSITIONING

The Spot portfolio competes most against do-it-yourself cloud cost optimization and management tools, as well as vendors including VMware CloudHealth and IBM Turbonomic. The company finds that it wins deals among customers seeking a combination of analytics, visibility, automation, and governance and security (via the CloudCheckr platform).

As such, the Spot by NetApp portfolio combines the functionalities that affect cloud spend and governance with process automation to support cloud savings. Furthermore, NetApp provides dashboards and report visualizations for greater collaboration among users.

NetApp goes to market through its direct sales teams as well as a large contingent of managed services providers (MSPs), many of whom came to the vendor through the CloudCheckr acquisition. Capabilities for MSPs include:

  • Automation and streamlining of cloud services billing
  • Ability to offer cloud desktops as a service
  • Improved cloud security and compliance
  • Ability to support a FinOps practice
  • Reserved instances arbitrage, custom rates, and charges
  • White-labeling for interface and reports

NetApp’s reference customers for cloud cost management include Samsung, HPE, IBM, University of Notre Dame, and Sony.

NETAPP’S PLANS FOR THE FUTURE

NetApp intends to keep growing its Spot portfolio. To that end, the company in spring of 2022 acquired Instaclustr, which offers a fully managed open-source database, pipeline, and workflow applications as a service. This purchase will bolster Spot’s capabilities to support cloud operations. NetApp also plans to continue building its MSP channel.

AMALGAM INSIGHTS’ RECOMMENDATIONS

Amalgam Insights recommends that organizations seeking financial and operational control of complex cloud environments consider Spot, either based on the scale of operations (typically $1 million+ annual spend), multi-cloud support, and the importance of cloud computing to the organization’s core operations. Developer teams or smaller organizations can also deploy Spot to target specific projects or workloads. The Spot portfolio, with its automation, workflow management, and analytics, offers insight into four key spend areas of operations — development, finance, security, and cloud. This breadth allows each group to gain visibility into other departments and to coordinate and align efforts to optimize cloud computing environments.

Need More Guidance Now?

Check out Amalgam Insights’ new Vendor SmartList report,Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, available for purchase. If you want to discuss your Cloud Cost Management challenges, please feel free to schedule time with us.

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Cloud Cost Management Vendor Profile: SADA Vendor Profile

Over the past few weeks, Amalgam Insights has delivered an in-depth look at the state of organizations’ cloud cost management and optimization initiatives, and discussed the challenges associated with improving those activities.

A significant challenge includes choosing the right vendor from among the many. Indeed, sifting through marketing and sales noise proves no easy task. Organizations often don’t know whether they would benefit most by teaming with a vendor directly, or by partnering with a managed service provider or professional services consultant — or by using a mix.

The options quickly become overwhelming for IT, finance, procurement, and other leaders responsible for improving how the organization spends money on cloud computing. In fact, in response (to some degree), some companies still try to manage and optimize their cloud resources through spreadsheets and other homegrown approaches. Manual practices, however, fail the organization. There are just too many cloud services and infrastructure considerations in even a single company to accurately track and manage without automation, tagging, cross-charging, and other imperative capabilities.

Therefore, as part of our continuing efforts to educate end users, Amalgam Insights presents the next portion of our Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession series: profiles of distinguished cloud cost management and optimization vendors.

Each of the companies earning Amalgam Insights’ “Distinguished Vendor” badge has undergone rigorous evaluation through briefings, presentations, and documentation analysis. Over the coming weeks as we publish more vendor profiles, note that we do so in no particular order. With that, we begin with SADA.

WHY SADA FOR COST CLOUD COST AND OPTIMIZATION MANAGEMENT

  • Takes a best-practices consulting approach
  • Offers professional services and fully managed service approach
  • Focuses on helping clients build skills so they can continue saving money independently

ABOUT SADA

SADA is an Amalgam Insights Distinguished Vendor for Cloud Cost and Optimization Management. SADA is a managed services provider (MSP) that supports enterprises. Founded in 2000, the company typically works only with Google Cloud as a managed cloud computing vendor. However, the expertise and recommendations from its cloud cost and optimization team span multiple cloud environments. SADA is based in Los Angeles with offices in Armenia and India; overall, SADA employs around 750 people. The MSP does not disclose its annual revenue, number of clients, or amount of cloud computing spend under management. SADA’s cloud cost and optimization consultants are designed to help clients across verticals who spend more than $2 million per year on cloud computing.

SADAS OFFERING

SADA does not develop cloud cost or optimization management software. Rather, its consultants specialize in Cloud FinOps (Financial Operations), showing enterprises how to save money — such as running non-production workloads only during work hours. At the same time, SADA’s experts teach enterprise FinOps professionals how to understand and oversee their cloud spending.

SADA delivers its assistance through various professional services packages. For example, the MSP can help configure cloud cost management tools, expose insights, demonstrate how to pull in business intelligence resources such as Tableau, and share best practices with the enterprise’s FinOps personnel. This can include identifying other people within the organization — from departments such as IT and procurement — who should join the FinOps team for the benefit of controlling and making the most of cloud computing spending. Along the way, SADA’s cloud cost management and optimization experts will produce assets such as runbooks and toolkits that clients can refer to as they improve their internal operations.

Standard FinOps services from SADA include in-person consultations, written reports with optimization suggestions, creation of database scripts for BigQuery to improve reporting, assistance in customizing tools such as Apptio Cloudability, and delivering customized runbooks and live enablement sessions.

Each professional service package features a fixed fee for a specific number of months. Pricing depends on which package and how much an organization spends each year. An enterprise typically needs a minimum of $2 million in annual cloud computing expenses to support SADA’s fee structure. SADA aims to save clients several times what it charges but does not make guarantees prior to meeting with clients as the company cannot promise an amount saved until consultants understand the depth of the problems on a case-by-case basis.

COMPETITION AND COMPETITIVE POSITIONING

Because of its people-first, FinOps-only approach, SADA finds that it does not face much competition. It does not compete against platforms at all. SADA’s consultants might work alongside an enterprise’s systems integrator, such as Accenture or Deloitte, but those firms tend to specialize beyond FinOps.

The SADA cloud cost and optimization management team generally finds its customers by word of mouth, through referrals, or from Google Cloud itself. SADA conducts workshops and experience labs with Google Cloud’s own FinOps practice, too. SADA does not publicly disclose its reference customers. However, the company gave Amalgam Insights access to customers so that analysts could verify that SADA serves organizations with multi-billion dollar revenues.

SADAS PLANS FOR THE FUTURE

In terms of a roadmap, SADA’s cloud cost management and optimization team intends to reach more technical professionals. That way, FinOps principles can carry over more into departments including IT, spreading greater cloud financial discipline throughout the organization.

AMALGAM INSIGHTSRECOMMENDATIONS

Amalgam Insights recommends that organizations spending at least $2 million per year on cloud computing consider SADA for FinOps guidance to reduce unnecessary spending if they are seeking to bolster the capabilities of their internal staff. Managing and optimizing cloud spending requires expertise, and organizations can thrive by empowering their own people to handle those requirements. First, though, they need to learn the nuances of what impacts cloud spending and the subsequent best practices for managing those factors, which SADA’s consultants demonstrate and impart.

Consider SADA if your organization is seeking to learn how to manage cloud expenses, but is not in search of a vendor to permanently manage cloud expenses. SADA does not aim to stay within an organization indefinitely to support cloud costs. Instead, the MSP promotes a “teach to fish” ethos so enterprises eventually can become their own cloud FinOps experts. As cloud computing continues to enable new and more business models, products, and services, strengthening the enterprise’s FinOps and IT skills will prove vital to remaining competitive.

Need More Guidance Now?

Check out Amalgam Insights’ new Vendor SmartList report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, available for purchase. If you want to discuss your Cloud Cost Management challenges, please feel free to schedule time with us.

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Cloud Cost Management Part 5: Understanding Vendors’ Key Differentiators

It should come as no surprise that Amalgam Insights believes that any organization supporting fast-growing cloud ecosystems must oversee those resources with proven software and/or managed or professional services. After all, the benefits typically outweigh any drawbacks executives might associate with partnering with yet another third-party provider. In fact, organizations spending more than $1 million each year on cloud infrastructure and platforms as a service are prime candidates for adopting cloud cost management and optimization solutions

Indeed, not doing so jeopardizes financial, operational, strategic, and governance initiatives. In the face of a global recession, the thread of double-digit inflation, and ongoing investor and executive pressure, controlling costs and making the most of technology will become even more of an imperative. And at a time when cloud computing costs often dwarf the net profit of an organization, rationalizing cloud costs can produce meaningful bottom-line results.

To that end, dozens of vendors specialize in providing software, tools, and services for managing and adjusting cloud computing resources. In some cases, they also deliver related managed services. However, choosing from among the multitude of possibilities does not present an easy task. Amalgam Insights has done the hard work so organizations may understand what makes one vendor different from another. Starting Sept. 15, we will publish a range of vendor profiles. That way, through our series on cloud cost management and optimization, and our report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, end users can gain the knowledge to make the ideal and differentiated choice.

In previous installments in our series on cloud cost management and optimization, we have covered why organizations need to implement these practices and pointed out the features that make vendors sound the same. Now it is time to understand five major differentiators that actually set providers apart from one another.

1. Automated Orchestration for Cloud Workloads

Some platforms automate the tasks that manage workload connections and operations, both on private and public clouds. This is important for easily enabling processes tied to specific workflows and business functions. Such software also provides automated, role-based accesses; this helps organizations better meet security and compliance requirements. And, finally, automated orchestration delivers cost savings — via greater efficiency — that likely will exceed the IT Rule of 30.

Recall, that Amalgam Insights’ IT Rule of 30 states that every unmanaged IT subscription spend category — cloud, mobility, telecom, SaaS, you name it — averages 30% in waste. If the organization spends, say, $1 million a year on technology subscriptions that are not proactively managed, odds are that $300,000 of that is going out the door unnecessarily. In other words, that money amounts to salaries and/or cash that could (should) have been conserved.

Accordingly, automated orchestration for cloud workloads features a great deal of capabilities that contributes to goals for spending wisely and saving money.

2. Budgeting Sources and Forecasting

IT and finance leaders need to understand cloud spending so they can adjust infrastructure and services and forecast accurately. These have grown into even more critical requirements as the world emerges from COVID-19 and faces a global recession. Therefore, Amalgam Insights recommends that companies with little to no experience in managing cloud expenses, accounting, and finance incorporate principles and best practices from organizations focused on cloud cost optimization such as the FinOps Foundation, an industry association that has focused on financial operations for cloud infrastructure and platform.

With that in mind, one of the key capabilities to look for in cloud management software itself is the ability to perform continuous cost optimization. This must be an automated process that scales applications, instances, storage buckets, and other cloud resources to avoid over-provisioning and reduce waste. We say the process must be automated because there are too much data and resources for any human to track manually.

In addition, this automated process needs to happen on a constant basis, ideally meaning multiple updates per day based on real-time usage. Cloud workloads change so quickly that IT and finance need near-real-time visibility and alerts. This way, IT can make adjustments on the fly while finance gleans the information it needs for accurate budgeting and forecasting.

Organizations benefit the most from cloud management and optimization platforms that deliver continuous, rather than intermittent, optimization.

3. Continuous Kubernetes Container Optimization

Similar to the section above, organizations using container management such as Kubernetes will require continuous optimization. It’s too easy for Kubernetes clusters to be over-provisioned, lie idle, or go unmanaged altogether.

Furthermore, a lack of oversight potentially sets the stage for the organization to fall out of compliance with governmental regulations and corporate policies.

Continuous optimization applied to Kubernetes resources, in specific, will support an organization’s goals for trimming or eliminating waste and for shoring up compliance requirements. 

4. Depth of Data to Support Machine Learning

Remember, IT and developers aren’t the only leaders who need to know what’s going on with the organization’s cloud environment. Other line-of-business heads — think finance, procurement, operations, even human resources — need visibility, too, for strategic decision-making. Cloud cost management is a team exercise with the cloud cost or FinOps manager as the hub of a center of excellence to support cloud resources.

This is where it becomes more vital that the cloud cost management and optimization platform gets feedback from the various inputs to improve recommendations over time.

5. Proprietary Intellectual Property

Finally, another differentiator among cloud cost management and optimization platforms comes in the intellectual property on which it’s built. Organizations with proprietary technology may have unique advantages in supporting and optimizing cost and may be able to prevent other vendors from pursuing a similar course of action. Organizations may experience tradeoffs between cost management and application performance or pursue more rapid cloud updates across hybrid cloud environments.

Next Steps

With this blog, and the previous four, Amalgam Insights has explained the need for cloud cost management and optimization, discussed the challenges in front of organizations, presented the areas in which vendors come off as similar, and why, and, here, identified true differentiators. The remainder of this blog series will focus on our profiles of 10 Distinguished Vendors. These independent assessments show how each company sets itself apart from the crowd. These evaluations will come in immensely handy for end users and resellers trying to solve cloud cost management issues. Expect the first profile on Sept. 15.

Need More Guidance Now?

Check out Amalgam Insights’ new Vendor SmartList report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, available for purchase. If you want to discuss your Cloud Cost Management challenges, please feel free to schedule time with us.

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VMware Aria Transforms the Technology Lifecycle Management Market

At this year’s VMware Explore, VMware announced the launch of VMware Aria based on three product families: VMware vRealize, CloudHealth by VMware, and Tanzu Observability. Aria brings these three solutions together with a shared graph data store, VMware Aria Graph, to support a combined Aria Hub that provides automation, cost, and observability capabilities across multiple clouds.

VMware was already an Amalgam Insights Distinguished Vendor for Cloud Cost Management prior to this announcement as the market leader in Technology Expense Management with over $20 billion in annual spend under management.

But with this platform, VMware has now created a new category of cloud management that competitors will struggle to match. To read more about this announcement, check out our Market Milestone report, available at no cost until the end of this week.

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Cloud Cost Management Part 4: Why Cloud FinOps Vendors All Sound The Same

Too often, the process of selecting a technology provider — of any kind — unearths more questions than answers. In many instances, vendors’ sales and marketing messages confuse, rather than clarify, because they all sound so similar. This puts IT, procurement, and finance leaders in the frustrating position of trying to identify real differentiators, all while hoping for the best outcomes.

Choosing a cloud computing cost management and optimization vendor offers no exception. As we noted in the third installment in our blog series, most (although not all) of these providers make the same benefits statements to potential customers. So, instead of leaning on hope, Amalgam Insights recommends enterprise buyers use our ongoing guidance to identify important differentiators. We begin by presenting similarities Amalgam Insights has noted in vendor messaging that prove confusing to potential buyers.

4 Areas of Confusing Messaging Among Cloud Cost Management Vendors

Recall that, in the previous blog, we pointed out continuous optimization and automation/artificial intelligence as the first two examples of similarities shared among cloud cost management vendors. The remainder of this installment covers the four additional issues we have pinpointed as challenges for evaluating Cloud FinOps providers. Keeping these aspects in mind will allow executives and line-of-business heads to spot providers’ true differences more easily rather than reinventing the wheel. This will go a long way toward arming organizations with the knowledge needed to develop a vendor selection process that will help narrow down the ideal choice.

1. Container and Service Management

With the emergence of Kubernetes as a mainstream containerization platform, cloud computing can now be deployed more granularly. This makes cost and resource tracking even harder. When a workload is not attached to a specific resource or service, IT has more difficulty assigning it to a project or cost center. Organizations supporting stateless apps need to figure out how to track cloud usage. To meet this challenge, vendors will toss around the buzzphrase “Kubernetes management.” The tracking of containerized compute can be done proactively, optimizing nodes in expectation of workloads or reactive ways that look at the usage. Get insight from the vendor on how they support consumption below the application layer as “container management” is being used in a variety of ways to describe cost, operations, technology, workflow, and/or infrastructure accounting in various ways.

2. Single View of Multiple and Hybrid Clouds

Another commonality among solutions in our Amalgam Insights’ new report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, is that of the single interface. In this report, we focused on cloud cost management and optimization providers that bring together multiple cloud vendors and hybrid cloud resources (e.g., Amazon Web Services, Microsoft Azure, Google Cloud Platform, niche players, private clouds, on-premises hardware) under one roof. Rather than forcing users to access each cloud provider’s interface separately, third-party vendors’ management platforms deliver insight and reporting into each cloud through one portal. This reflects one of the basic benefits of using an independent cloud cost management and optimization platform. A variety of companies in the cloud cost management marketplace are still specialists in one or two cloud platforms. Make sure that your proposed vendor for cloud costs is aligned with your IT architects’ vision for cloud and data center usage.

3. Reporting and Analytics

Every cost management and optimization platform — cloud or not — contains reporting and analytics. The detail to look for is the depth and granularity of analytics, including the out-of-the-box alignment to IT, DevOps, finance, procurement, and other relevant cost and inventory management departments. Analytics can also be supported by algorithmic and machine learning models that help to predict future demand for resources, or that proactively detect potential opportunities for optimization. However, the presence of analytic and reporting capabilities that provide financial and operational visibility into multiple clouds is not in itself a differentiator within the cloud cost management world.

4. Managed and Professional Services

In addition to software, most cloud cost management and optimization vendors offer some level of professional or managed services, as well as help desk. While none of this is unique, the ways in which the services are delivered could be. Organizations will want to vet variances including the following:

  • Hours of Operation
  • Human vs. automated assistance
  • Dedicated or named account resources
  • Cloud provider certifications

Some organizations will require around-the-clock support availability while others will not. Some will have no issue using chatbots to resolve problems while others will want a human. Some will operate well with general assistance while others will opt for personnel dedicated to their account. Finally, some cloud cost management and optimization vendors may not certify all their staff on the various cloud platforms the organization uses.

Knowledge Is Power

Knowing what makes many cloud cost management vendors the same will equip IT, procurement, finance, inventory, and other leaders to pinpoint meaningful differentiators and therefore choose an ideal fit. Amalgam Insights has done much of the footwork for readers. In that spirit, the next blog will cover the key differentiators that analysts have identified among providers. From there, we will publish a number of vendor profiles. Combined, all this information will support organizations’ quests to most ably manage their cloud computing environments, especially as a global recession threatens to hit.

Need More Guidance Now?

Check out Amalgam Insights’ new Vendor SmartList report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, available for purchase. If you want to discuss your Cloud Cost Management challenges, please feel free to schedule time with us.


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Cloud Cost Management Part 3: Exploring Why Cloud Cost Vendors Sound Similar

We Look at Two Ways in Which Providers Message Similarly to One Another

In the first two blogs in our series on cloud cost management, Amalgam Insights dove into why cloud costs are hard to manage and the challenges that impede many organizations from implementing disciplined cloud cost management and optimization. Those installments set the stage for this post, which lays out the value of relying on third-party software and services for cloud cost and lifecycle management. From there, we begin to explore the similarities observed among vendors, so organizations may spend less time and energy identifying the best fit(s).

Wait — Why Use a Vendor at All?

Any technology calls for proper oversight to ensure its best use and to assure optimal financial stewardship for the organization. To meet this need, dozens of companies provision software, and/or professional and managed services. When it comes to cloud cost management and optimization, these third-party offerings intentionally replace in-house counterparts. Surprisingly, a number of global organizations still rely on internal staff and piecemeal technologies to oversee and monitor their cloud environments.

Given the rapidly growing amount of cloud computing consumption, and the cost overages that easily accompany that usage, a homegrown approach must evolve, and quickly. Organizations must gain financial and operational visibility into their cloud environments. That starts by implementing a cross-departmental practice Amalgam Insights frames as Technology Lifecycle Management.

Figure 1: Technology Lifecycle Management

A Cautionary Note

Newcomers to the world of cloud cost control often are surprised to learn that using a cloud cost management and optimization platform may not inherently save substantial amounts of money on an ongoing basis.

In many cases, that is not, in fact, the overarching point.

Rather, the software will give IT — and finance and engineering — the data and recommended actions to make sure all cloud environments are running at their most optimal, are in use, and that they serve the organization’s needs.

Think of the matter this way: managing cloud computing does not mean cutting spending to the bone. Rather, organizations thrive when they support employees with the correct infrastructure and applications. (And, yes, that can call for putting more money into the cloud budget as tech serves as a driver for revenue creation.)

Many enterprises experience significant savings after first deploying a cloud cost management and optimization platform. Ttransforming an uncontrolled or poorly controlled environment into an efficient one will naturally lead to that outcome at first based on the IT Rule of 30. But as optimization continues, those gains fade because the platform is keeping the cloud environment at its most efficient.

Contrary to how it might sound, watching those gains disappear over time by creating an optimized environment actually is the goal. The right vendor will enable the organization to achieve that aim.

With that in mind, we now explore the first two ways in which many cloud cost management vendors end up sounding the same. The next blog will present more similarities among these providers. Amalgam Insights takes this approach so enterprise buyers are empowered to make their vendor selection processes more efficient and productive.

Sifting Through the Benefits Statements

With a couple of exceptions, cloud cost management and optimization vendors tend to make the same benefits statements to potential customers. Yet, once enterprise buyers understand those similarities, they will be better equipped to pinpoint important differentiators. In fact, later in this series, Amalgam Insights will publish a number of vendor profiles. The intent is that, by the time those go live, organizations will have the knowledge to create a matrix that will help narrow down the ideal choice.

Similarity 1: Continuous Optimization

Cloud management platforms must support continuous optimization as cloud performance and transactional activity accelerate, and as companies become increasingly susceptible to peak usage and other cost challenges associated with the flexibility of cloud computing.

The greatest benefits of an always-on optimization effort that pulls billing information directly from the cloud provider are the prevention of overspending and the right-sizing of consumption.

Unless a vendor delivers professional services rather than an actual platform, enterprises have the right to expect the cloud management software to perform constant right-sizing actions on a daily basis, or even more frequently, leading to the best use of the cloud environment. This capability has become table-stakes within any technology management platform and a vendor that overemphasizes continuous optimization may be lacking in other important areas.

Similarity 2: Automation and Artificial Intelligence

Continuous optimization relies on some level of automation, which is vital in a cloud cost management and optimization platform. After all, reducing human intervention is key to achieving more accuracy and efficiency. Given the massive volume of cloud computing billing and usage data, it is not humanly possible to manually check all of the data that comprise a cloud bill — at least, not without automation and an algorithmic-checking approach.

Note this important caveat: Most vendors will refer to their automation as “artificial intelligence,” largely because of the sophistication and modernization the term calls to mind. However, most of the automation in question is actually algorithmic processing with some aspects of basic regression to identify correlation and trends. Amalgam Insights sees that the majority of “AI” in this particular market typically lacks the feedback mechanisms, model training, and ongoing data science required to be considered modern AI. This isn’t necessarily an issue, as cloud computing usage is often driven by discrete and specific business needs or by the developer team’s needs. But the obvious advice here is to always follow up on AI claims, as there is no current standard on what constitutes AI in this market.

Enterprises would do well to inquire about how each platform automates data, and how it learns from recommended and implemented actions. If the software just imports information and populates fields, that — while handy — is rudimentary and standard.

Consider, as well, that a cloud cost management and optimization platform should remove the need for excessive manual manipulation, both to reduce the potential for human error and to foster any intelligence that will help the software learn from actions.

In the next installment, get more insight into more similarities among cloud cost management and optimization vendors.

Need More Guidance Now?

Check out Amalgam Insights’ new Vendor SmartList report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, available for purchase. If you want to discuss your Cloud Cost Management challenges, please feel free to schedule time with us.

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Cloud Cost Management Part 2: Organizations Are up Against Big Challenges in Cleaning Up Cloud Costs — COVID Cleanup, Skills Shortages

The first blog in this series on cloud management and optimization discussed why organizations must make the most of their cloud computing environments – especially as a recession appears likely.

Now, in this second  installment, Amalgam Insights analysts lay out the argument in favor of using third-party software, consultancies, and managed services to achieve optimal cloud management status.

We do so knowing that many executives, fearful of a global economic slowdown, might feel tempted to automatically resist the recommendation to bring on another vendor. Thus, we take a step back to paint a picture of the challenges organizations are up against, and share insight, based on collective years of experience, about why paying to manage the cloud environment will, when done right, deliver the greatest value.

Cloud Management and Optimization: It’s About Much More Than Saving Bucks

As a reminder, almost any cloud management and optimization activity can save costs, at least to some extent. That is, of course, useful to any business intent on conserving financial resources. However, more to the point is that cloud management and optimization should lead to more productive, efficient, and deliberate use of cloud computing. After all, cloud supports remote and hybrid workers, as well as strategic corporate initiatives. Therefore, it must deliver. Rarely (if ever, frankly) do organizations get the most out of their cloud environments by trying to monitor and manage cloud resources through spreadsheets or piecemeal efforts.

In other words, Amalgam Insights asserts that it usually makes sense to spend money on the well-chosen cloud management and optimization tools — tools that support revenue-generating initiatives, whether directly or indirectly. The adage, “Spend money to make money,” rings true here as companies seek to eliminate duplicate resources, select the right storage and compute options for data and workloads, and tweak environments so they perform at their best.

The third-party platforms to which we refer support cloud environments at scale. They remove dependence on ungovernable, internally created spreadsheets, on hastily created Git pages with inconsistent documentation standards, and on disparate notes.

Yet, before teaming with a cloud cost management and optimization software, or a professional or managed services provider, it is vital to understand the challenges all organizations share, as well as those that are more specialized, which may require a more custom approach. After considering all the guidance in Amalgam Insights’ 2022 report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, IT, finance, and data leaders should find themselves well-equipped to identify and choose among the options. (Any enterprise executives in search of independent assistance are invited to arrange a consultation with Amalgam Insights analysts. )

The Enterprise Challenges Addressed By Cloud Management and Optimization

Regardless of size, organizations relying on cloud computing face a variety of challenges, especially in the wake of COVID-19-fueled rollouts. Recall that the pandemic in early 2020 forced most businesses worldwide to increase adoption of cloud computing — whether infrastructure, platform, and/or applications — so they could remain operational amid lockdowns and economic upheaval.

The sudden flurry of deployments often was messy; IT personnel quickly spliced together cloud solutions to keep employees connected so they could work remotely. In most cases, there was little or no time to think about how many cloud environments were running.

Then, as enterprises shifted from full-on crisis to figuring out the New Normal of worker expectations, organizations generally did not pause to assess the state of their cloud environments. This typically came down to a lack of awareness or internal skills.

At the same time, the pandemic created a staff and skills shortage that continues into 2022 and will extend beyond 2023. As an example, a recent Korn Ferry study indicates that, by 2030, the world will experience a human talent shortage of more than 85 million people. The staffing challenge is real. When it comes to evaluating and managing cloud environments, there are simply fewer IT experts available to conduct this work for their employers.

Despite the skills shortage, finance executives have grown more aware of looking into and trying to track cloud computing expenses. Still, this presents another hangup for enterprises that do not manage their cloud estates. The finance department lacks the granularity of data that will deliver the reports and insights needed. These leaders need the information that supports asking the right questions of the IT department about cloud computing outlay — and that helps them allocate charges among business units. Simply put, most organizations do not have usable visibility into their cloud environments.

Assessing Cloud Governance, Security, and Provisioning

Alongside the previous challenge lie two more — an absence of governance and security. Organizations that do not properly manage their cloud computing environments risk running afoul of their own policies, not to mention possibly those of various governments. Many organizations also are enacting environmental and sustainability initiatives. A number of cloud cost management and optimization platforms now support those efforts; spreadsheets cannot.

In addition, speaking to security, cyber threats gain even more traction within unmanaged cloud environments. While responsible cloud stewardship does not guarantee insulation against hacks, an absence of said stewardship almost certainly guarantees a breach.

Finally, many organizations are operating in over-provisioned cloud environments due to a variety of situations — say, employee demands for certain applications, an enterprise’s regional or global footprint, and idle resources.

All of the factors combined make for a perfect storm where the organization overpays even as it jeopardizes governance, security, and budget.

To sum up, enterprises are up against the following cloud computing challenges (see Figure 1):

Figure 1: Key Challenges for Managing Cloud Computing

Yet organizations can — and, Amalgam Insights contends, must — take steps to overcome these circumstances. And with global recession fears mounting, the impetus to do so comes as more pressing than ever.

In the third blog in this series, Amalgam Insights will go deep into the value organizations stand to gain by partnering with a proven cloud management and optimization provider.

Need More Guidance Now?

Check out Amalgam Insights’ new Vendor SmartList report, Control Your Cloud: Selecting Cloud Cost Management in the Face of Recession, available for instant download. 


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An Important Side Note on FinOps and Cloud Economics

Organizations sometimes describe the job of cloud cost management as a “FinOps” role (an abbreviation of “Financial Operations” or “Financial Cloud Operations”) or as a Cloud Economics position. Amalgam Insights finds that there is confusion about these terms. Here’s why.

The common-sense definition of Financial Operations belongs to the Finance team responsible for financial close, budgeting, planning, treasury, tax, and accounting. Meanwhile, the concept of “economics” typically applies to the ecosystem of the production and consumption of value. In many cases, that goes beyond the scope of a standard “cloud economics” role, which focuses on cloud optimization and cost management.

However, in practice, these terms of FinOps and Cloud Economics are often used interchangeably to refer to managing costs, as well as inventory and governance. This is misleading on a variety of levels. The appropriation of “FinOps” to be cloud-specific is confusing enough, especially since a separate “FinOps” is starting to emerge for financial applications used to assist with planning, budgeting, close, consolidation, treasury management, and other financial tasks requiring some strategy, workflow, or collaboration to complete. The Cloud Economics term is a challenge for a different reason: it is an inaccurate term as economics should refer to the financial and business value associated with cloud deployments, including sales bookings and support costs at the microeconomic level and the environmental impact and ecosystem costs at the macroeconomic level. Economics, finance, and accounting are three separate concepts that the IT department needs to understand.

Amalgam Insights acknowledges that this is a common occurrence and hopes this note provides clarity for the reader who may find herself already acting as a “cloud economist” or “FinOps practitioner” based on activity around managing cloud costs while perhaps not being familiar with this terminology. The biggest concern Amalgam Insights has with these inaccurate terms is that the use of these terms may lead to the trivialization of these roles as FinOps or cloud economists are typecast as “cost analysts” rather than personnel who understand the business repercussions of cloud on the business as a whole. Cost analysts are a cost center while business analysts who understand revenue root causes are often a profit center.

In this light, what can FinOps and cloud economics personnel do to avoid being pigeonholed? Here’s Amalgam Insights’ advice.

1) Talk to the finance team in charge of organizing and managing IT costs. Somebody at the finance team has to either articulate the value of IT or rolls IT up into general and administrative costs or cost of goods sold. Understand how IT is categorized in your organization, as cloud may be miscategorized.

2) Understand the full lifecycle of cloud costs. This includes vendor sourcing, contract negotiations, optimization, service rationalization, and the security and governance concerns associated with technology vendor selection. Do not be stuck within one small section of Technology Lifecycle Management within a complex spend category such as cloud unless you are seeking to be commoditized over the next few years.

Finally, understand the economics associated with cloud. ESG (Environmental, Social, and Governance) is an increasingly important and strategic topic for businesses seeking to improve branding and reduce their risk to any operations that may lead to future concerns. If you want to be associated with economics, understand not just the services and technologies supported but their impacts on the environment and to the service provider. This allows you to be a resource not just for IT, but also for the CFO, Chief Strategy Officer, Chief Procurement Officer, and other strategic vendors.