How to Estimate the Cost of Cloud Migration? Factors to Be Taken into Account

Photo of Wiktor Starzak

Wiktor Starzak

Updated Oct 17, 2023 • 10 min read
Estimating the cost of cloud migration

In recent years, cloud migration has become a common undertaking for even small companies.

With cloud services becoming widely used and more efficient, it’s not hard to see why.

In brief, cloud migration is the process of transferring all digital assets that a company owns from one datacenter to the cloud. It’s similar to physically moving assets from one place to another, except cloud migration is digital.

However, as with any moving process the cloud migration cost can be difficult to estimate. This article will help your company to demystify the costs behind cloud migration and to understand all the factors that should be considered when embarking on your cloud journey.

Where should you start when considering cloud migration?

Hiring external contractors and consulting companies to help you get started is the best place to start. Cloud migration can be a tricky process and disastrous if not done correctly.

External consulting companies and contractors can aid in calculating the potential risks as well as estimating the amount of work that needs to be done to move your assets into the cloud. You could always do this process yourself, but you would need to have extensive knowledge on cloud migration.

You would also need to know how to refactor and change original applications to be more cloud native. Having cloud native applications can reduce infrastructure costs.

What does cloud migration cost contain?

Cloud migration pricing is difficult to estimate. Here’s a run-down of the costs you should take into account:

1. The cost of the team you’re working with

Although the cost varies from person to person, cloud migration requires excellent infrastructure. This means that it’s likely your company will need to hire a Cloud Architect – someone who has skills in designing cloud infrastructure and can cover the technical requirements needed for the migration. This will also necessitate the hiring of a development team to implement the application.

2. The cost of creating the infrastructure

The infrastructure has to be created by a DevOps team, or single person depending on the size of the infrastructure. If the infrastructure is less complex then this may be a smaller cost, but larger infrastructures will require more manpower.

3. The cost of the cloud provider

Each provider and application will have a different cost, but this is usually easy to ascertain and is one of the easiest costs to calculate. The type of provider chosen should be decided by the cloud architect and can depend on factors such as the programming language needed or database types.

4. The cost of Data Transfer

Although it seems trivial, the amount of cloud storage your company may need should be similar to the amount of storage present on premises, although this can vary. Very big infrastructures may require different pricing, but this is probably not relevant for your company if you’re unsure.

Other factors to consider such as the time period for the data transfer alongside useful links to cloud calculators can be found further down this article.

Using an SSD cloud storage compared to an HDD cloud storage may also affect the cost of the data transfer, as SSD’s are more efficient but also more expensive to maintain.

5. Post-migration costs – maintenance and development

Post-migration, the costs to consider of course include the ongoing payments to the provider to use the cloud space, and that’s about it. This is something that can be quoted to you by the provider, and so doesn’t cause much difficulty in calculating the total cost of maintenance.

Keep in mind that your previous datacenter will also continue to generate upkeep costs, so turning this off if your migration succeeds is vital to saving money in this area.

Factors that must be taken into account when calculating cloud migration cost

Alongside the cost of the actual migration, there are other more hidden costs that need to be taken into account:

  • Re-writing applications

Depending on the programming language or database used, applications may need to be rewritten to work as cloud native. One of the major costs to take into account here is estimating the amount of time the developers need to rewrite the application.

A longer rewrite will naturally lead to a greater cost. Unfortunately, this is one of the hardest costs to estimate as it’s almost impossible to tell how long a rewrite will take. It can be anywhere from a short 7 days to several months or so.

  • Infrastructure spin-up

DevOps team members are development engineers who create infrastructure using code to create the resources needed for the cloud. This is similar to the process that developers do when writing and rewriting applications but the time the DevOps team members need to complete their tasks is usually easier to estimate.

For example, a small advertising platform with a main site, blog and extras such as offers will take 1-2 DevOps members about a few weeks to complete.

  • The amount of data that needs to be transferred

The sheer amount of data that needs to be transferred to the cloud will have a large impact on the final total cost of cloud migration. The process of cloud migration can be essentially seen as paying a provider to store transferred digital information, meaning that larger amounts of information will incur larger costs to your company.

What to define before estimating the costs of cloud migration

Before you begin estimating the costs of cloud migration, you should define some key terms and concepts:

The future of the product

The future of the product is a key factor when determining future costs of cloud migration. If the product may be developed further in the future, it may be worth rewriting the application and pooling more resources into making the product more cloud native.

This can help to ease future development by making further development easier.

The amount of data

Consider all the assets that you want to transfer and define the amount of data in its totality. This includes pictures, videos, previous databases and other important digital assets.

Migration time

The amount of time it takes to migrate all of your assets to the cloud is key to define when calculating total costs. The faster your company can fully migrate to the cloud, the sooner all the on premises infrastructure can be turned off.

This saves valuable money as the old on premises infrastructure no longer needs to be maintained.

External help

It’s rare that a company manages to complete the process of cloud migration without any external help whatsoever.

However, the amount of external help needed will depend on the size and scope of the data that needs transferring as well as whether your already hire developers and whether these developers have time to rewrite applications.

If not, then the cost of recruitment has to also be factored into the total cost of migration.

The cloud provider

One of the most important things to define before even beginning the process of cloud migration is the cloud provider that you will choose to store your data. Usually an external company will help with this, as mentioned earlier, but the cloud architect will also have a say in this.

Potential costs of training

Because the technology and software industry advances so fast, you may need to train and re-train employees to work with the modern methods and solutions that the cloud offers.

Non-cloud employees can be afraid of changes and block the process of cloud migration at senior management. Extensive training can help take care of this issue but will incur extra cost.

Cost estimation methods

There are two main methods to calculate the gross cost of each part of cloud migration: the cloud cost and the human cost.

  • Cloud cost

The cloud cost is the simpler of the two and can be calculated using cloud calculators to total the transfer price of the data and the storage price for the amount of data that will be transferred.

Google provides an excellent cloud estimation service that can be found on their Google Cloud Platform Pricing Calculator.

  • Human cost

The human cost of cloud migration is harder to pin down and can vary depending on developer rewrites of the number of employees and DevOps team members you will need to hire. This essentially varies depending on application size and scope.

How to reduce cloud migration cost

The absolute truth is that there are no shortcuts to reduce cloud migration costs. Cloud migration is a delicate process that cannot be tampered with or exposed to shortcuts as this can cause mistakes to be made, costing even more time and money.

The safest way to migrate to the cloud is to do things properly and to come up with a cloud migration strategy to ensure that your assets are safe and secure in their new cloud.

Photo of Wiktor Starzak

More posts by this author

Wiktor Starzak

How to build products fast?  We've just answered the question in our Digital Acceleration Editorial  Sign up to get access

We're Netguru!

At Netguru we specialize in designing, building, shipping and scaling beautiful, usable products with blazing-fast efficiency

Let's talk business!

Trusted by: