Skytap Announces Seven Strategies to Reduce IT Costs With Cloud Computing

SEATTLE, Wash. – February 4, 2009 – Skytap, Inc., the leading provider of cloud-based virtual lab solutions, today announced seven key strategies IT managers can implement immediately to reduce costs through cloud computing. Based on feedback from Skytap’s customer base, these strategies provide a proven path for transitioning costly on-site environments to the cloud. A free white paper outlining the “7 Strategies to Reduce IT Costs with Cloud Computing” is available at

As the economy decelerates, many enterprises face weakening customer demand. IT managers have been forced to reevaluate spending and look for ways to reduce IT budgets. While most cloud vendors, such as Amazon and Microsoft, offer attractive platforms for developing new applications, IT managers are seeking the benefits of “cloud economics” for their existing application portfolios. On average, IT organizations spend 70-80% of their budgets managing and maintaining their existing applications, so the largest cost saving opportunities can be found in these IT environments. Below are seven discrete strategies that help IT leaders migrate application environments to the cloud and measure the return on investment of their cloud initiatives.

1. Replace Upfront Capital Expenditures with Low Risk Operational Expenses

Acquiring new infrastructure and implementing virtualization can require a large capital expenditure. Using a cloud service allows an IT organization to reduce capital expenditures, as well as transition virtual infrastructure management to a provider that has a core competency in managing efficient, resilient data centers.

2. Recast Virtualization Initiatives as Cloud Initiatives

By recasting virtualization initiatives as cloud initiatives, enterprises can develop a strategy that delivers optimum cost savings. Moving to a cloud strategy enables enterprises to avoid further investment in internal physical or virtual platforms that are often used only for peak server loads.

3. Eliminate Costs for Data Center Space, Power and Cooling

Cloud computing facilities are typically highly efficient, low cost facilities with minimal operational expenses. Because cloud services are designed to be multi-tenant, they ensure maximum utilization of computing resources and minimize data center real estate. IT managers using the cloud reduce internal consumption of space and power, and share in the efficiency savings of the cloud provider.

4. Migrate Under-Utilized, High Cost IT Environments to the Cloud

Many IT environments, such as those used for application development, testing, staging, IT prototyping, and training, are dynamic. This means they require frequent set-up and reconfiguration by IT operations. These dynamic environments are ideal candidates to migrate to the cloud as capacity and expense easily scale up and down based on demand.

5. Utilize Virtual Automation and a Self-Service Model to Reduce IT Labor Costs

Virtual lab automation technology enables self-service virtual environments which vastly reduce the time to set up and tear down new virtual machine configurations. In fact, a study conducted by vokeStream(1) found that organizations that adopted virtual lab automation saved an average of three days set-up time per virtual environment.

6. Increase Productivity by Using Shared Cloud Environments for Distributed Teams

Cloud-based IT environments solve many of the collaboration issues distributed teams face. Projects with shared virtual environments can be easily created in the cloud with appropriate access controls and team administration. These environments can be replicated for new teams and then isolated from other systems as necessary to ensure separate work streams.

7. Improve Cost Transparency for IT Projects with Usage-Based Reporting and Auditing

IT organizations often struggle to allocate costs and bill internal groups for services. Cloud offerings are typically billed by usage and therefore have sophisticated auditing and reporting capabilities built into the platform. By adopting a cloud solution, IT managers can leverage these reporting capabilities to better manage costs and allocate charges to business units based on actual consumption.

“Making a move to the cloud in a strategic and thoughtful manner reduces the risks with this innovative approach to IT,” said Scott Roza, CEO of Skytap. “These seven cost reduction methods provide a launch point for organizations seeking to reduce IT costs. The dynamic nature of IT labs — for application development and testing, training, and IT prototyping — makes them prime candidates for an immediate transition to the cloud. Customers using Skytap for these initiatives have seen significant benefits including increased flexibility, higher levels of productivity, and lower capital and labor costs.”

(1) vokeStream Market Snapshot: Virtual Lab Automation, 2007

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