“Cloud-flation” & preventing runaway cloud costs w/ Leon Kuperman @ Cast.ai #94

We cover why locked-in cloud commitments are bad for eng teams & how your org can take advantage of elastic pricing models instead! Leon Kuperman (CTO @ Cast.ai) explains the dilemma of locked-in cloud spend, cost planning strategies for SaaS orgs, how to minimize egregious cloud egress cost and drive better cloud utilization through consistent analysis & debates in your eng org. Also learn why Leon is betting on container deployment as the future of software delivery & what that means for Cast.ai!

ABOUT LEON KUPERMAN

Formerly Vice President of Security Products OCI at Oracle, Leon’s professional experience spans across tech companies such as IBM, Truition, and HostedPCI. He founded and served as the CTO of Zenedge (acquired by Oracle). Leon has 20+ years of experience in product management, software design, and development, all the way through to production deployment. He is an authority on cloud computing, web application security, and Payment Card Industry Data Security Standard (PCI DSS).

"So you're literally committing to a three year deal where you know, in those next three years, the probability of computing power increasing is VERY high and the probability of cost decreasing for those same computers is very high. So you're not really getting the 30, 40, 50% discount. 

So I call these reservations or these look forward commitments a necessary evil because... customers HAVE to do it in many cases. They don't have an alternative. But at the same time, it's not good for the business!”

- Leon Kuperman   

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SHOW NOTES:

• Why Leon cares about cutting cloud costs (3:05)
• Economic & financial models for eng leaders (6:56)
• Cloud economics & its impact on cloud cost (8:18)
• The dilemma of locked-in cloud commitments (11:35)
• Why eng companies opt for locked-in cloud services (14:47)
• How container deployment will impact the current cloud model (16:01)
• Moving from a locked-in model to an elastic pricing model (19:39)
• What eng teams need to take advantage of an elastic cloud pricing model (22:07)
• Cost planning opportunities for SaaS companies (24:57)
• The best utilization debates for evaluating cloud spend (28:40)
• Three architectural planning principles to keep in mind (30:26)
• Drive better cloud utilization through consistent cost analysis & recurring debates (31:59)
• Defining egress & its cost for eng teams (33:05)
• Healthy methods for escaping egress costs (35:27)
• What “cloud-flation” means for eng leaders & cloud macro-economics (38:55)
• Rapid fire questions (43:06)

LINKS AND RESOURCES

• (article) “Why Your Cloud Expenses Are Rising: Blame Cloud-flation” by Leon Kuperman
• (article) “Snapchat Earnings and the Case of Runaway Cloud Costs” by Leon Kuperman