IBM customers face up to 29% increase in cloud costs from January 2024
IBM has announced intentions to raise prices for its cloud computing services starting at the beginning of the next year. A GitHub release note detailing these price adjustments for the tech giant's infrastructure as a service (IaaS) and platform as a service (PaaS) offerings reveals that some customers worldwide could experience an increase of up to 29%.
The release note explains, "Prices for... infrastructure services vary from location to location, based on a percentage uplift from US base prices." In this context, "uplift" refers to the price of services in comparison to the US base costs.
For IaaS, the increases will encompass bare metal services, virtual service instances, file and block storage, and networking infrastructure.
Similarly, global prices for accelerated archive storage and deep archive storage are set to rise by 25% and 26%, respectively.
The release note clarifies that there are no planned changes to prices for IBM power systems virtual servers, third-party software, or network bandwidth.
IBM customers in different regions will experience varying degrees of price increases. Customers in IBM's Sao Paulo region will face the most substantial price hike at 29%, and European customers can also anticipate notable increases. The London data center region will see a 13% increase, while customers in Frankfurt, Madrid, Milan, and Paris can expect a 16% rise.
IBM's PaaS offerings will also see a 3% price increase across the board globally. This increase applies to users of Red Hat OpenShift, IBM Cloud databases, and the company's Kubernetes service.
While these price adjustments may raise concerns among global businesses that rely on cloud services, it’s not an isolated case. Cloud costs have been on the rise for the past 18 months, with many firms grappling with increasing expenses in the face of challenging economic conditions, inflation, and rising energy costs.
The escalating cloud costs have prompted numerous organizations to reevaluate their relationship with the cloud, exploring optimization practices like FinOps or even considering migrating workloads back to on-premises hardware.