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An IDC report commissioned by Amazon reports dramatic savings by companies that have adopted cloud services.
The report found that the return on investment from cloud computing increase when measured over longer time periods. On projects lasting three years, organizations see a $3.50 ROI for every $1.00 originally invested, and that amount jumps to $8.40 for every $1.00 invested when measured over a five year period. Cloud computing customers also have the benefit of a 72 percent reduced downtime and improved application availability.
The report found that on average, the five-year ROI from using Amazon Web Services (AWS) was as high as 626 percent. This translates into a $2.5 million savings on average per application deployed via AWS. For example, organizations were able to replace a typical infrastructure developed for $1.6 million with an equivalent structure built on AWS for $302,000.
Organizations also saw savings in both development and deployment costs that averaged 80 percent less than with on-premise systems. Application management costs were reduced by 52 percent and infrastructure support costs were reduced by 56 percent.
Stephen Hendrick, co-author of the IDC report, said that “Development went a lot faster because middleware components are all rendered as services and many parameters associated with deployment are simply configuration policy decisions.” Similarly, when it comes to operational support, Hendrick said that “since the deployment architecture and policy around app behavior is policy driven. [Cloud computing] eliminates many of the classical tasks associated with high availability, performance, scalability, and disaster recovery.”