TLDR
- Cloud spending is up 30% on average due to adoption costs of AI and generative AI, according to a survey by research firm Vanson Bourne.
- Among FinOps practitioners, 72% said GenAI cloud spending is becoming “unmanageable.”
Spending on cloud computing is up 30% on average over the past year, mainly due to the adoption of AI and generative AI technologies, according to a survey by technology research firm Vanson Bourne.
A whopping 92% of IT and finance leaders said they are spending more on the cloud, with expenses almost evenly split among private cloud, SaaS, IaaS, and unified communications as a service. This is likely due to the storage and processing requirements of large language models, the research firm said. The survey was commissioned by Tangoe, an expense and cost management solutions provider.
Moreover, 72% of FinOps practitioners also said GenAI cloud spending is becoming “unmanageable.”
On average, organizations spend $40 million per year on the cloud. Six out of 10 use a hybrid cloud configuration, while 29% use only private cloud and 9% public cloud.
“GenAI cloud expenditure has now become an additional and major burden for FinOps teams –
stubborn, escalating, and nearly impossible to manage without deploying a cloud cost management
tool to get this under control,” according to the survey.
Those who use a third party for cloud management can better handle these rising costs.
However, optimizing cloud computing is more than just managing costs. The top priority among respondents is security and regulatory compliance (55%), followed by enhancing productivity (54%).
U.K.-based Vanson Bourne surveyed 500 IT and finance practitioners in the U.S. whose companies have annual revenues of $500 million to $50 billion.
