Cloud Data Warehouse Cost

Estimating the Cost of a Cloud Data Warehouse

June 10, 2022 03:00 PM

 Cloud Data Warehouse Cost

Selecting the right data warehouse, together with the proper business intelligence and analytics tools, is important to bringing cutting-edge insights from your basic data. But there’s one all-important question to answer before you begin your search: how much does an information warehouse cost, exactly?

Of course, the expectation is that your selection of the data warehouse will have a healthy return on investment—but the ROI of any data warehouse will heavily rely on its components and how well it links with your current company workflows and procedures. According to the IT research and advisory firm Gartner, "cost should be a secondary concern to the achievement of business advantages" when buying BI software. In other words, concentrating on functionality will be more prosperous in the long run than concentrating mainly on cost.

With all that said, however, price is still an important element in any data warehouse purchasing decision. In this article, we’ll go over the different elements that play into the cost of a data warehouse, so that you can make a smarter, better- informed better-informed decision for your organization.

What is a cloud data warehouse?

A cloud data warehouse is a database that is kept as a managed service in the cloud and is optimized for analytics and scalable business intelligence. Unlike traditional data warehouses, which were not engineered for explosive data development, cloud data warehouses let you expand or scale down the warehouse based on business requirements and budgets. It stores data from a range of other sources like CRM, Iota, finance systems, etc. and because the information is placed in a highly cooperative and structured manner, it comes ready for the application of analytics and business intelligence.

What is a cloud data warehouse used for?

Cloud-based data warehouses get a lot of use cases for companies. Some of the top applications are:

Consolidation of siloed data

Cloud data warehouse solutions allow the pulling of data from a variety of structured references across a company. These sources can be websites, emails, or point-of-sale systems, and then get them into one place so that analysis can be performed on them to gain insights.

Making decisions in real-time

The cloud data warehouse architecture enables real-time data analysis. This helps in proactive addressing of challenges, identification of options, better efficiency, lowered costs, and better reaction to company events.

Enabling custom reporting

Generally, cloud data warehouse services keep the historical data on a separate server compared to where they keep the working data. This way, the end-users can access them and run their questions without having an effect on the operating systems’ performance or assistance from IT.

Incorporation of machine learning and AI

A well-thought-of cloud data strategy allows the collection of both historical and real-time data for creating algorithms that can offer predictive insights like the anticipation of the end of traffic, the suggestion of appropriate products to the clients, etc.

While these are surface-level use points of the technology, there is an explanation for why there is a bank in the cloud data warehouse market size and its application. And those causes lie in the advantages of cloud data warehouse solutions.

What are the benefits of using a cloud-based data warehouse?

Modern cloud data warehouse architecture combines data warehousing capabilities, big data scalability, and cloud elasticity at a fraction of the standard cost.

Data warehouse costs. Let us look at the advantages that this cloud computing mixture brings to an organization.

Speedier insights:

Cloud data warehouse platforms deliver effective computing abilities, and are developed to deliver real-time analytics through data coming in from numerous sources at a much more rapid rate compared to on-premise warehouses. This allows companies to access insights much more quickly.

Scalability:

A cloud-based data warehouse comes with real-time, more or less unlimited data storage, which is effortless to scale as the company's requirements increase. What is great about cloud data warehousing is that you don’t have to purchase new hardware to accommodate the explosive development of data.

Overhead:

Managing the traditional warehouse required a typical server room full of expensive hardware and the inclusion of professional employees to handle, manually update, and solve problems – a recipe for high costs. Cloud data warehouse architecture needs zero hardware or office space, bringing the costs significantly down.

I know that up until this point, you would have shown that cloud data warehousingwould be the best option for your organization. But, how does it work on the cost front? Let us look into that next.

What are the features of cloud data warehouse costs?

Several factors make up for the cost of a cloud data warehouse. Here is what those are:

Infrastructure

The most direct costs you will have to pay will be around software and hardware infrastructure charges. For the traditional data warehouse, you have to pay for the licenses, servers, and storage. In the case of cloud data warehouses, however, the pricing is often determined by the computing power since there is no infrastructure expense involved. And this price range goes from one warehouse provider to another.

Team

When adopting the cloud, accounting for a team of experienced people becomes equally significant. Now, whether you intend to hire a cloud computing service agency or an internal team, you must consider the cost.

Data engineers:

They will model data and optimize the warehouse for implementation.

Analysts:

They will assist in determining the situation the data warehouse will solve.

Data Warehouse Managers:

They will look over the data warehouse setup and manage development.

Opportunity cost

The final cost element that you will have to account for is the opportunity cost. Suppose it takes you one year to set up a cloud data warehouse. What would the company cost during this duration when you are deprived of the insights? You should also account for the cost of the team that will be operating on this while they could be working on some other project.

SaaS cost

If you are using a SaaS data warehouse, you will have to factor in the SaaS vendor price and calculate it against your requirements. For instance, if the vendor is setting per terabyte of storage, you will need to determine the storage your cloud data warehouse will need.

Maintenance and engineering costs

In the case of cloud data storage, which is usually managed, the maintenance costs tend to be a piece of the monthly fees. However, there are two parts to this cost. Part one is the constant costs like performance tuning, and then there are the unanticipated costs of when you’ll have to restructure the parts of the data warehouse according to company requirements.

Tools cost

The last cost you will have to consider is the cost of tools. Based on which vendor you select; you would have to buy tools that make it comfortable to change data. Several data engineers use tools like Stitch, Fivetran, Matillion, etc, to perform data modification. These tools, in turn, come with a price.

An amalgamation of these factors would together determine the cost of executing the cloud data system. To make things a little easier, here’s a snapshot of a cloud data warehouse comparison based on cost.

Amazon Redshift

If your warehouse requirements are less than 1 TB, the cost would run anywhere between $0.25/hour and $4.80/hour. If you require more storage, you would have to spend around $0.85/hour to $6.80/hour, with an additional charge of $0.024/GB/month for storage objectives.

BigQuery

Google BigQuery estimates the warehouse costs based on analysis and storage. Storage would cost around $0.02/GB/month. All the data that is left now for 90 days gets moved to long-term, which would be somewhere around $0.01/GB/month.

Azure

In the case of Azure, the cost of data storage is estimated at $122.88/TB/ month. It also allows you to buy plans for disaster recovery and threat detection for an extra cost.

Snowflake cloud data warehouse

Each snowflake comes with a certain computation price. It asks you to purchase a virtual warehouse that either has one server or a mix of servers. The cost of these virtual warehouses is based on the performance you desire. The most cost-effective one is two credits/hour, which works out to be $2/hour. Snowflake cloud data warehouse storage begins at a flat rate of $23/TB/ month.

So here were the basics of what a cloud data warehouse is and the advantages and costs of a cloud-based data warehouse.

In Conclusion

While this was a primer article, we liked to modify it to the basics of the technology and the cost details if you choose to ditch the traditional data warehouse path. However, cloud data warehouse technology is far-reaching. There are several other factors that an entrepreneur must consider when migrating from traditional to cloud data warehouses. We can make this strategy easy for you. Get in touch with our cloud data experts today at PerfectionGeeks Technologies. We are here to help you get the best plan for your cloud data warehouse.

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