What is Cloud Hosting?

Cloud hosting, also referred to as server on-demand hosting or cloud server hosting or cluster server hosting is the term used to describe the service that is provided to customers via a cloud – a pool of resources spread across more than one server and are used on a per need basis. The pooling of resources by a cluster of servers allows cloud hosting to easily manage peak loads and enables it to supply much needed resources by pooling their resources together. This ability not to rely on one server alone is the main reason why cloud computing is one of the most reliable hosting packages, greatly reducing downtime due to server malfunction and assures accessibility, cost efficiency and seamless scalability.

What expenses are involved in cloud hosting?

Expenses involved in cloud hosting could be classified into two; that of initial costs and on-going costs. Initial costs could also be described as capital expenses or capital expenditures.
Capital Expenditures include:

  • Facility Acquisition or construction – this expense includes the cost of constructing the facility that will house your hardware or the cost of acquisition of a property as it is and the refurbishment required to make it for use.
  • Power, Fire Fighting and Cooling Infra – this includes the installation of all the necessary power requirements including the installation of an uninterruptible power supply, the installation of a top-of-the-line fire fighting system and the installation of necessary power lines and switches as well as the cooling system required to protect your hardware.
  • The cost of the server hardware, the network and the storage hardware.
  • The cost of providing racks to house your server hardware and the storage racks, the cables required to run the entire system and labor cost of installing and setting-up the entire physical network.
  • The cost of licensing your software, which includes the licenses for your Operating System platform, your server software and the licenses for the application that you are going to use.

On-going Expenditures, also known as the Operating Expenses shall include all the expenditures needed to keep the facility running and operational. This includes:

  • Payroll for the personnel you hired to manage and run the facility. This further includes the benefits due to your employees as required by law.
  • The cost of maintaining the facility including the repair and upgrade of the physical structure housing your hardware. This also includes upgrading the power infrastructure regularly, the maintenance of the fire fighting system and the cooling system.
  • The cost of hardware maintenance and upgrade which is required to ensure that your hardware is updated and is fully efficient to provide for the resources required from a server. One of the most common hardware upgrade is to upgrade the RAM of your hardware or perhaps to increase storage size capacity.
  • The cost of software maintenance and upgrade to stay up-to-date with the latest applications and patches.
  • Other fees not regularly required but are essential such as insurance fees, legal fees as well as accounting fees.

What to consider in determining the cost of cloud hosting?

One of the major considerations in choosing a cloud host is the cost of hosting. Most often than not, potential customers use these prices to select their cloud service provider (CSP). In order to determine the total cost of ownership you need to consider a lot of factors, including the following:

  • Check the type of billing to choose, whether Monthly or Hourly;
  • Check the CPU and RAM speed and the size of storage.
  • Check the bandwidth offered.
  • Check the Operating System used, as this could determine additional cost in the future.
  • Check the network used.
  • Check the support they provide.

How much money should I need as a capital for cloud hosting?

The total amount of money needed for cloud hosting would largely depend on your choice of the facility to house your hardware and its type of support facilities, your choice of hardware and software and of how large or small is the size of your company.