Metratech’s CTO, Doug Zone outlines how billing for cloud services requires new methodology and the concept of ‘dynamic billing’ where price can vary according to demand are the future of billing.
Billing ain’t what it used to be
Metratech’s CTO, Doug Zone outlines how billing for cloud services requires new methodology and the concept of ‘dynamic billing’ where price can vary according to demand are the future of billing.
I agree that you want to charge for cloud services in a way that encourages efficient use of services, but the charging has to also encourage the cloud service provider to run applications and make use of resources efficiently. For example if a service provider simply billed for CPU, memory, IO and storage, then there would be no immediate incentive for the service provider to tune applications. In fact badly tuned applications would create bigger bills and more revenue, in the short term at least while there is spare capacity. It’s potentially a bit like a Telco delivering high resolution images or videos to a mobile device with a limited display and then charging per megabyte.
Also the idea of varying tariff based on time of day, etc is what Telco and Utility companies have been doing for years using on-peak, off-peak tariffs, etc to bring demand in line with supply and available capacity.
The key to find the right billing approach is still in defining the parameters that are measurable and understandable by the users and which provide incentives for responsible behaviour by both the users and service providers.
So I’m not sure if I agree with “Billing ain’t what it used to be”. The same old issues are there, only the services and technologies have changed.