Many businesses are majorly overspending on cloud services

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Many businesses are majorly overspending on cloud services, potentially wasting millions of dollars every year, new research has claimed.

Couchbase found that with a typical enterprise spending more than $33 million a year on cloud services, and spending 35% more than what’s necessary, many are losing more than $8.75 million that could be saved or spent elsewhere

The company spoke to 650 senior IT decision makers about their experience with cloud storage and cloud adoption, and chalked down the excess in costs to a whole range of factors.

What’s driving overspending?

These included not having enough insight into spend or ways to optimize costs, the need to improve security and compliance functionality, and inflexible pricing plans that don’t give enterprises what they need in a single package.

In addition, Couchbase pointed the finger towards management tools that don’t give the control needed; data not being stored where needed to meet regulatory or performance requirements; and vendor lock-in, meaning enterprises cannot use the specific cloud infrastructure they want.

Cloud conundrums

The research also highlighted issues with cloud computing more generally.

More than one third (36%) of enterprises said cloud services adopted in the last three years had not met expectations, while 56% said past cloud decisions had made digital transformation projects more difficult in 2021, and 48% more expensive.

Enterprises are struggling against service limitations according to Couchbase.

The majority - 61% - of enterprises have had to restrict their digital transformation ambitions because of challenges with cloud services, while 58% choose cloud services that did not give the ability to scale the business to meet demand.

Asked to identify their top concerns around new cloud infrastructure, security of data was identified by 43% of respondents, followed by managing data in the cloud (33%) and future-proofing to meet future digital needs (31%), while 30% are concerned about keeping costs under control in the future. 

However, despite this issues, 95% of enterprises surveyed  said that increased movement of infrastructure to the cloud is “inevitable.”

By 2025, enterprises want 58% of their IT spend to be in the public cloud and said that they are currently more than halfway (56%) towards meeting that goal.

Will McCurdy has been writing about technology for over five years. He has a wide range of specialities including cybersecurity, fintech, cryptocurrencies, blockchain, cloud computing, payments, artificial intelligence, retail technology, and venture capital investment. He has previously written for AltFi, FStech, Retail Systems, and National Technology News and is an experienced podcast and webinar host, as well as an avid long-form feature writer.