Blog post

Use Consumption-based Pricing For Data Center Infrastructure

By Jeffrey Hewitt | March 23, 2021 | 0 Comments

Many organizations prefer to move to an OPEX-based approach to purchasing IT products and services and move away from CAPEX-based buys because of the sometimes high initial costs.  Much of this influence has come from public-cloud based services which align with OPEX planning.

The good news is that a number of global providers of infrastructure offer consumption-based pricing options for those organizations who wish to avoid the initial expenditures of typical CAPEX-based purchases.  Figure 1 illustrates how pay-per-use consumption models work.

My analyst colleague, Daniel Bowers, is the author of a Gartner document that provides an overview of the infrastructure providers who offer these consumption models.  The document is entitled Market Guide for Consumption-Based Pricing for Data Center Infrastructure. As this document explains, consumption-based pricing is designed to:

  • Align infrastructure costs with usage.
  • Allow for scaling up and down of resource availability and cost.
  • Shift risk of overprovisioning to the vendor.
  • Shorten procurement cycles.

This market guide also provides a list of the infrastructure providers who offer pay-per-use options and identifies which types of infrastructure comes under these programs for each of the identified vendors.  It is a great place to start if an I&O organization wants to move their infrastructure buys to a more OPEX-oriented purchase.

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