Businesses make 70% savings on applications hosted on Amazon

cloud computing services

Businesses make 70% savings on applications hosted on Amazon

Cliff Saran

An IDC study has found that businesses using Amazon's cloud services over the past five years have made considerable savings.

The Amazon-commissioned survey was based on interviews with 11 large and mid-sized organisations, based in North America, Europe and Asia-Pacific, that had deployed Amazon Web Services (AWS).  


IDC found that by moving on-premise hosted applications into the AWS cloud, the companies questioned had saved 70% on a typical application over a five-year lifecycle.

“I can’t think of any applications that are unsuitable for cloud computing," said Steve Hendrick, group vice-president at IDC. "The pay-as-you-go and scale-up and down models are characteristics you cannot get elsewhere.”

He said the participating companies ran transactional applications, mission-critical applications and “bet the business” applications on the Amazon cloud.

“Cloud computing also gives you a high level of flexibility around high availability, which is difficult to replicate in your own datacentres,” said Hendrick.

Amazon has traditionally been regarded as an infrastructure-as-a-service (IaaS) provider with its EC2 (Elastic Cloud Compute) for servers and S3 (Simple Storage Service) for storage in the cloud. According to the study, most IT shops fail to appreciate the level of sophistication that many cloud services, including AWS, provide.

"All too often, companies approach deployment decisions without fully understanding how much more available and reliable their applications can be [in the cloud] while still saving significantly on operational cost," the IDC report stated.

Hendrick said the businesses in the study were also making use of the full Amazon cloud platform by leveraging application programming interfaces (APIs). 

While IaaS makes applications portable, since the user does not have to use any platform-specific features, businesses are effectively locked in once they start building applications on top of the Amazon platform or rival platforms.

However, he said that while there is a higher level of lock-in, the convenience enables businesses to avoid paying for other external services, which can make the application cheaper to build and faster to deploy.

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