Cloud Optimization and How To Cut Costs

Cut Hosting Costs & Improve Resource Efficiency

A lot of companies overspend on hosting and infrastructure without even realizing it. Three easy tricks to reduce web hosting expenses, get better quotes from cloud providers, and maximize resource utilization.

They initially switched to online platforms because it was the easier, faster, and cheaper option compared to running physical hardware. Staying up to date allowed them to scale services for free without massive hardware investments. But today, over 60% of companies report that their hosting expenses are spiraling out of control.

Common Cost Challenges

Many companies struggle with:

• Not knowing what they’re actually paying for.
• Complicated pricing structures from service providers.
• Wasted resources, like unused services.
• Balancing cost savings with security and compliance.

These problems often arise because companies make minor adjustments to their infrastructure instead of having a clear strategy.

A Plan to Cut Cloud Costs

Set Rules for Spending (Corporate Guardrails)

Imagine a company moves to the cloud for flexibility but ends up with surprise bills because different teams purchased unapproved services. Setting clear rules, or “guardrails,” helps prevent this.

How guardrails help

• Budget caps – Set spending limits for teams or projects to avoid overspending.
• Tracking expenses – Monitor usage to catch problems early.
• Approval processes – Require manager approval for large purchases to align with company goals.

These rules eliminate unnecessary spending and help maintain control.

Negotiate Smart Deals with Providers

Cloud providers often offer discounts for long-term commitments or bulk usage. For example, Airbnb saved up to 60% on some services by analyzing usage data and switching to a better pricing plan.

Tips for Better Deals

• Use data – Show usage patterns and future needs.
• Commit wisely – Secure discounts by locking in long-term contracts or larger volumes.
• Review regularly – Ensure you're always getting the best rates.

Think of your provider as a strategic partner that can help you save money and grow your business.

Optimize Your Setup

Evaluate your cloud usage to eliminate inefficiencies. Cutting costs doesn’t mean sacrificing performance.

How to optimize

• Use analytics tools to identify unused resources.
• Adjust services dynamically based on demand.
• Automate workflows to boost efficiency while reducing errors.

For example, one company reduced hosting costs by compressing and caching data to make transfers more efficient.

A Team Effort

Optimizing infrastructure costs isn’t just about technology—it’s about teamwork. Encourage collaboration between finance, IT, and business teams to develop a FinOps culture, where everyone works together to improve spending efficiency.

Three Phases of FinOps

• Inform – Understand expenses clearly.
• Socialize – Share cost insights across teams.
• Operate – Continuously refine spending management.

Conclusion

Cost optimization is an ongoing process that requires smart rules, strategic deals, and efficient systems. By aligning teams and treating cost-saving as a group effort, companies can maximize their investments while staying prepared for the future.