Azure TCO Cloud Enablement Cloud Assessment


To determine why a Cloud Assessment is an essential step for organizations, we first have to address the prominence of Cloud Computing. Statistics reveal a strong growth of the Cloud Computing sector since its inception. In 2013, the worldwide spending on cloud IT infrastructure was estimated at $22.3 billion, by 2020 this has surpassed the $75 billion mark- representing an average growth rate of 19%.
According to a study from Eurostat, 36% of the companies in Europe are already leveraging cloud services. While the fastest-growing cloud computing segment has been Software-as-a-Service, particularly email and file storage services, recently Infrastructure-as-a-Service and Platform-as-a-Service solution’s strong growth rates were fueled by the pandemic. The reasons behind this rapid expansion are due to many variables:

  • Speed Improvements: Companies want to enhance their velocity for developing new solutions as quickly as possible.

  • Flexibility: Organizations find the cloud to be a more flexible platform to respond to predicted and unforeseen changes on demand.

  • Operational Costs: IT departments want to focus on their core-value activities: their application and data. In this sense, getting rid of all the underlying tiers that compose the IT infrastructure is a step in that direction.

  • Business Continuity: To assure SLA of their critical systems, companies are enabling cloud solutions as Disaster Recovery, and Availability Zone

cloud economics

A recent survey from Flexera provides more clear evidence of this tendency: It is estimated that in 2021, 82% of the companies have been defining a strategy to deploy some type of hybrid cloud (meaning a combination of on-premise, private cloud, and public cloud) or even multi-cloud solution (as the previous but with many public cloud providers).

Given the magnitude of the changes occurring in the market, companies consider it necessary to gain insights into what are the possible paths to approach the cloud. Achieving cloud adoption is not as simple as flipping a switch, it involves a series of changes that companies have to evaluate:

  • Individual business requirements

  • Time and budget constraints

  • Change from ITSM mindset to DevOps mindset

  • Shift from static to dynamic infrastructure

  • Changes on the operation model

Completing a Cloud Adoption requires a solid foundation. In this blog, we answer the question of why a Cloud Assessment is indeed an important prerequisite to build upon.

Evaluating the Infrastructure

The first step to understanding the potential benefits of adopting the cloud is to visualize how the current infrastructure looks like. Since there is not a single aspect to be left behind, we have to consider a multitude of factors:

  • Hardware/Servers that compose the IT infrastructure

  • Interdependency between these devices

  • What are the applications and data contained

  • Who the clients are, where are they located, and what their utilization patterns are

current infrastructure general overview

There are two main reasons to delve down into this aspect. First, it provides us with a report on the state of readiness to migrate to the cloud, in other words, it helps us to delimitate the scope of the project. The second reason is that it allows us to understand all the elements that compose the IT infrastructure and, through this, have a better estimation of the current on-prem cost.

Identifying Cloud Strategies and their TCO

The main reason to perform a Cloud Assessment is to gain insight into the services that can be leveraged in the cloud and estimate their Total Cost of Ownership (TCO). The result should help us to classify the workloads according to their target on Azure, identifying those that are ready to be rehosted (also called “Lift&Shift” candidates), those that need some changes to take advantage of the cloud (refactor or rearchitected), and those workloads that cannot be migrated (retain, rebuild or replace).

Furthermore, once selected the resources that are going to host the services, it is possible to estimate the cost of the new environment. Azure’s pricing model depends on many variables, including the type of resource, the capacity, location, and inbound and outbound traffic on the resource. Therefore, it is important to understand the variables that compose the prices. For example, Azure Virtual Machine and Azure Database, the most common services in Azure, can be enabled as followed:

  • Pay-As-You-Go: This option allows you to pay according to the actual usage, the resource is billed per hour and it can be switch on and off at any time. This also provides complete flexibility to increase or decrease the resource as needed.

  • Reserved Instances: These instances are pre-purchased resources for one or three years in a specific region. Committing to reserved instances in advance grants a discount of up to 72% compared to Pay-As-You-Go prices, which make it the best option for hosting workload with stable ongoing usage.

  • Spot Instances: It is possible to buy unused computing power at a discount of up to 90% compared to Pay-As-You-Go prices. However, Spot Instances can be interrupted on short notice, so they are considered suitable only for fault-tolerant workloads, like dev/test systems.

Azure Strategies & TCO

Other services in Azure, such as Blob Storage, are billed per GB of storage over a period of time (typically one month), and alternatively, it is possible to select different pricing tiers based on how often data is retrieved (Hot, Cool, or Archive). Some other services in Azure go even further by completely abstracting the resources involved, the so-called Serverless Instances, these resources are not billed based on usage itself but on the number of times that the code is executed.

When migrating from the traditional CapEx/OpEx model to the cloud, it is important to understand the factors that determine the prices and those that can lead to potential cost savings. The assessment helps us to understand the variables to consider when calculating prices in Azure.

Planning Migration

Once we identified the services to be leveraged in the cloud, estimated their cost, and compared these costs with current expenses, we can have a better idea of the cloud strategy to follow. The last reason to perform an assessment consists of being able to place this strategy in a timeline, defining all the steps to perform, the resources, and the budget implied.

Migrating to the cloud involves a series of changes on which the company has no experience. In this sense, the assessment helps to get a better idea of the time needed to carry out each stage of the project, as well as the personnel involved and the cost of the services. The result is a realistic planning that ensures a successful transition to the cloud.

Proposed Project Timeline

Azure TCO & Cloud Enablement at MobiLab

Cloud Computing has become a very competitive and mature market over the last years, this has aroused the attention of many companies who are looking for different ways to leverage services in the cloud. But before embarking on this journey, it is necessary to gain insights into what are the possible paths to approach the cloud. MobiLab’s “Azure TCO & Cloud Enablement” program is a KPI-based approach to get an objective understanding of the if & how of Cloud Adoption. Our 6-week assessment considers the current state of the on-premise infrastructure as well as the economic & financial aspects of adopting the cloud.​

Azure TCO & Cloud Enablement


  • On-Premise Infrastructure, Data & Application Evaluation​: Obtain a complete report about your current resources and their readiness status to migrate to the Azure Cloud.

  • On-Premise TCO​: Estimate the cost streams of your current CapEx / OpEx approach.

  • Azure Cloud-Strategy & Cloud TCO​: Get a complete understanding of the resources to be leveraged in Azure and their Total Cost of Ownership.

  • Investment Analysis and ROI Calculation: Calculate the potential return of investment through a detailed financial model that compares the cost streams of cloud adoption with the on-premises costs.

  • Migration Plan: As a conclusive part of our assessment at MobiLab, we provide our clients with our expertise on the recommendations to follow, as well as detailed planning of the migration process with all the stages involved.


Throughout this blog, we have highlighted the value provided by a proper Cloud Assessment. The ultimate goal is to clarify the knowledge of the companies by providing metrics concerning the state of readiness and the possible paths to undertake the transition to the cloud.

This blog is the first of a series of posts about our assessment process at MobiLab, over the next few blogs, we will dive even deeper into the specifics of the process.