How to Calculate Hybrid Cloud Cost

June 17, 2021


Hybrid cloud was introduced as a computing solution that integrates private cloud with public cloud services. By combining the security of the private cloud and the flexibility of the public cloud, hybrid cloud technology quickly became popular among organizations.

Flexibility, scalability, accessibility to data, and cost savings are the main benefits businesses have from migrating to hybrid cloud. Such a setup allows you to cut costs by matching cost-effective resources to the appropriate tasks.

How to calculate hybrid cloud cost.

Calculating Hybrid Cloud Costs

Since hybrid cloud setups involve multiple clouds, allocated resources, and servers, keeping a close eye on the budget and spending is necessary. If you are already using a hybrid cloud solution or are planning to do so, you want to know how much it will cost you.

Make sure to understand how to calculate hybrid cloud cost and which factors have the most significant impact on the estimated expenses.

Hybrid cloud cost considerations.

Management and Support Fees

Remember to consider the cost of managing and supporting a hybrid cloud environment. Running a hybrid cloud architecture requires a dedicated team for managing, deploying, and supporting the environment. The extent to which you need to provide management and support for such a setup depends on the hybrid cloud platform software you use and whether you are using colocation facilities.

Physical hardware security, cooling, power backups, and other hardware management and software and networking management and upgrades all need to be dealt with. You can choose a data center plan with different levels of support, outsource management, hire additional staff or utilize software to help manage a hybrid cloud.

Data Transfer

Migrating to the cloud involves fees that have a significant impact on overall spending. These are known as egress fees. Any incoming or outgoing data transfers, relocating data between VMs, for replication or backup most likely has a separate fee you need to count on.

Before committing to a plan, make sure to inspect the data transfer costs and examine what is and is not included in the initial price. To avoid unexpected expenses and spending too much on extra charges, try to find a solution that offers transparent upfront pricing.

Storage Fees

Include storage fees in your overall hybrid cloud costs. It is imperative to consider this factor if you expect large volumes of growing data. Evaluate how much it will cost you to store the data long-term.

Apart from storing data, fees are usually added for API calls to cloud storage services and sometimes even when you host the storage yourself.

Hybrid Cloud Software and Server Fees

Hybrid cloud software gives you a centralized management platform for interacting between private and public resources. It is important for enabling communication between the private and public cloud without having to manage the environments individually. The cost for the software itself usually has a subscription-based, pay-as-you-go, or initial upfront fee, which differs slightly from service to service.

In most cases, the software fee is predictable and straightforward to calculate in the overall cost. However, bear in mind the hardware requirements needed to run the platform. Some software options are designed to work only with specific hardware. This could be an issue and bring about additional cost if you already own servers that are not compatible. Check out any potential restrictions before committing to a hybrid cloud software to avoid unnecessary spending.

Customization and Integration Fees

Don’t forget to add to the equation how much you will spend on customizing an application to work seamlessly in the hybrid cloud environment. When moving an app from on-premise to the public cloud, you need to configure and test it to make sure there are no issues.

Additionally, merging the public and private environments also involves integration costs. Evaluate how much you expect to spend on integration fees and add it to the overall budget. In some instances, the application could also require rewriting if it doesn’t perform well after migrating to the cloud.

Compliance Fees

Compliance, policies, audits, and security requirements play a crucial role in the hybrid cloud model. Depending on how critical the workload is, invest to ensure data security and compliancy.

Auditing the cloud service and managing internal and external compliance impact the overall cost of the hybrid cloud setup. Compliance requirements will differ depending on internal business policies, clients and partners, vendors, and even state/federal laws.

Note: Learn about the difference between two major cloud computing strategies - multi cloud vs. hybrid clouds.

Common Mistakes When Calculating Hybrid Cloud Cost

After considering all the factors that impact your hybrid cloud expenses, make sure to read through the five most common misconceptions and mistakes that affect hybrid cloud cost.

Common mistakes in calculating hybrid cloud cost.

Wasted Resources

The biggest advantage of the hybrid cloud is that it is highly flexible and can provide additional resources on demand. Make sure to use this feature to your advantage and avoid spending on unnecessary resources.

It is common for organizations to buy resources assuming they will need the extra capacity in the future and end up not utilizing them. Doing so is the most common way of overspending in the hybrid cloud environment. Therefore, avoid overprovisioning to avoid overspending. Evaluate your requirements precisely.

Underestimating cost

Include all potential fees in the overall hybrid cloud budget to ensure you have a grip on the process. Include factors such as storage, software, management, customization, and management fees. Cut unexpected costs to the minimum by making a precise budget plan with all potential expenses.

Missing Out on New Options

Follow the latest trends and hardware/software options for hybrid cloud solutions to ensure your organization is getting the best it can buy. Hybrid cloud is constantly evolving and providing new ways to run your applications. This means you need to keep up with your cloud provider services and check when and where you can improve your environment.

Thinking Cloud is Always Cheaper

Cloud is cheaper when compared to building an entire infrastructure on-premise, especially when you need to scale for more resources. This is also true for hybrid cloud environments. However, businesses with stable workloads may not find hybrid cloud as resourceful and cost-efficient as larger organizations with peaks and traffic spikes.

Note: The benefits of cloud computing are undeniable. However, cloud may come with expenses you weren't expecting. Sign up for, a cloud cost optimization platform that helps organizations of all sizes identify areas of overspending in seconds.


After reading this article, you should know how to calculate hybrid cloud costs by considering the factors that impact the budget the most. Additionally, you should be aware and avoid the most common misconceptions about hybrid cloud cost.

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Sofija Simic
Sofija Simic is an experienced Technical Writer. Alongside her educational background in teaching and writing, she has had a lifelong passion for information technology. She is committed to unscrambling confusing IT concepts and streamlining intricate software installations.
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