The Consumer Often Loses in Information Asymmetry
Supply and demand will NEVER be perfect. Consumers will never pay the “perfect price”. This is largely due to information asymmetry between producers and consumers in the modern economy.
Consumers are at the losing end in the battle for information symmetry until comparison shopping engines became popular and more accessible.
You can compare items and services ranging from hotels, air tickets, ride-hails, to even the best currency-exchange rate to use before checking out your shopping carts on e-commerce sites.
Comparison Engines For Cloud Providers
What if comparison engines apply to data center services? I had a hard time searching for a website that does this but was glad to have found one: https://www.cloudorado.com/
I am not promoting cloudorado nor do I attest to how accurate their calculator is. According to its website’s FAQ:
Cloudorado is a price comparison service of cloud computing providers. It could be also referred as a price calculator for multiple cloud hosting providers, since the comparison is performed by calculating price for individually set server needs. It currently focuses on Infrastructure as a Service (IaaS) providers. There is no cheapest cloud computing provider. Each provider has different pricing models, different relation between resources, different packages and so on. If you play with Cloudorado a bit, you will quickly find out that a provider which is the cheapest for one cloud server might be the most expensive for another one. The price is multidimensional function, where are at least 9 factors which can be taken into consideration. We allow to you to find the cheapest provider for your needs without effort.
But Prices Do Not Stay Constant For Your Business.
Although these price comparisons are meant for you to find your cheapest provider, it does not mean the prices would not change by the time you are already entrenched into the cloud provider’s ecosystem. I know of large born-in-the-cloud companies paying six figures to public cloud providers monthly and are looking to in-source some of their IT operations back on-premise.
What About Disaster Recovery?
While I am happy for my customers moving IT operations into cloud data centers, they often fail to answer for their disaster recovery plans or perhaps have the false sense of security by “Availability Zones” from a reputable cloud provider. A friendly reminder: Availability Zones are still under the same management of the cloud provider.
What if ( touch wood) your cloud provider disappears due to commercial or geopolitical reasons?
Personal Prediction: Dynamic Surge Pricing for Cloud Services
What if prices for IaaS change by the hour? Elastic demand and supply matching will soon be the new normal, at least in my country. Singapore’s largest taxi operator and ride-hailing app Uber announced a collaboration. Why is this happening? Large fleets of taxis idling and an ever-changing demand for traveling services.
It is not just taxis, it is also happening to electricity supply/demand. For example, at this time and day while you are at work, you have noticed the electricity tariff is 30% lower than usual and you remotely start your washing machine. This is a compelling use case for “smart” appliances. It is not just a cool feature, it actually has a practical use for saving household expenses!
Coming back to data centers, I personally believe dynamic pricing will be the new data center economics because data centers and office spaces are essential services for every business, especially for start-ups. It is akin to many investors flooding into a country looking for business opportunities and a shelter and property developers rush in to meet the demands.
To meet the technological demands of businesses, data-center-as-a-service will definitely attract more data center service providers.
And in the case of large fleets of taxis under-utilized, dynamic pricing will definitely happen to match the over-supply to exploding/undiscovered/unreachable demands.
Solution? Go Multi-Cloud.
It is like launching my most-used taxi-hailing apps Grab, Uber, and ComfortDelGro to compare the prices manually before booking a ride. Similarly to my future data center scenario, whichever cloud provider is providing the best pricing to your business, just make the switch.
Multi-Cloud sounds simple but it is complex. I will share on the benefits of Multi-Cloud and how technically you can achieve that in my next article. (If I have 5 “Likes” to this article?)