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Navigating the FinOps Landscape: A Comprehensive Market Analysis

Decoding IDC Market Glance: FinOps Cloud Transparency for 2023

Jevin Jensen
By Jevin Jensen
21 Sep, 2023

IDC recently released its first-ever Market Glance for the FinOps Cloud Transparency presentation. A Market Glance is a visual representation of the landscape of a specific marketplace, showing vendors that provide critical software and services to end customers. This Market Glance examines how software and service providers support enterprise wide FinOps teams in their journey to manage and optimize cloud costs. Enterprise FinOps teams can utilize a Market Glance to create a shortlist of vendors to review and compare when looking for modern tools. The Market Glance has multiple segments within the overall market, with many vendors appearing in more than one segment. This inaugural FinOps Cloud Transparency Market Glance lists vendors  who can assist your organization in increasing transparency and providing valuable insights into cloud spending. 

FinOps is a cross-functional discipline focused on collaboration and accountability of cloud costs. FinOps is more than a tool. A mature FinOps organization will create a modern approach to cloud investments, moving towards accountability through open collaboration across multiple teams. A software platform coupled with ongoing services will jump-start your FinOps journey. An increasing number of companies are undertaking this journey in an environment of tight IT budgets. In fact, 50% of enterprises tell IDC that public cloud spending exceeds their planned budget. Companies are embracing the continual, proactive benefits of FinOps instead of knee-jerk reactions to surprise hyperscaler invoices. With the complexity of multicloud pricing and configurations, it is common to see enterprises use software and services from vendors in this Market Glance to help get control of their cloud spending.

IDC organizes FinOps cloud transparency vendors into five segments. Vendors must have recognized and demonstrated capabilities in one or more segments for inclusion in the Market Glance. Many have been around for years, helping hundreds of customers successfully manage their cloud spending. Vendors in multiple categories typically offer a more comprehensive platform approach compared with those in only one segment that offer a best-of-breed or niche solution. Here are the essential capabilities according to IDC that enable FinOps teams to deliver business value:

  • Cloud infrastructure-as-a-service (IaaS) resource optimization: Many servers are overprovisioned compared to actual workloads, and other servers have been abandoned but are still generating costs. This segment can identify and make recommendations to remediate these scenarios and more. 
  • Report and pricing analytics: Every cloud provider offers various saving plans, reserved instances, spot instances, and other ever-changing pricing options. FinOps teams need a single source of truth with recommendations on the latest pricing tiers. Analytics provide deeper insights into cloud resources and their costs. 
  • Cloud software-as-a-service (SaaS) management: There are over 25,000 active SaaS providers today. Most enterprises spend more on SaaS than IaaS but need a tool to uncover hidden costs. This segment depends on machine learning (ML) to find and identify opportunities for savings.
  • FinOps service providers: To successfully mature FinOps teams and drive culture change, support from a FinOps services provider is often the quickest way to get to best practices. Some companies offer FinOps as an ongoing managed service. Additionally, reserved instances can be bought and sold in the marketplace through service providers,  with advanced insights only an experienced vendor can provide.
  • Container optimization: The fastest-growing area of cloud-native applications involves containers. This requires a new approach to optimizing container-based resources. IDC estimates containers will grow to 6.5 billion worldwide by 2025. Tools are needed to provide better insight and analysis.
FinOps Cloud Cost Transparency

IDC Market Glance FinOps Cloud Transparency 2Q23

As seen in the Figure, cloud IaaS resource optimization has the most significant number of vendors, followed closely by the reporting and pricing analytics segment, with many vendors appearing in both areas. The complexity of reserved instances and other pricing models of the public cloud providers means enterprises need these analytics and recommendations coupled with proper IaaS resource sizing. The bottom row offers a glimpse into the future with cutting-edge capabilities IDC believes will soon be needed by FinOps teams. SaaS optimization represents a large area of cloud spending that enterprises need insight into today. Containers are a rapidly growing cloud-native approach as many companies modernize their application environments, but the complexity of containers and Kubernetes can drive costs higher. 

An essential segment is FinOps service providers. A trusted advisor can help large enterprises start their FinOps journey with best practices and proper tools. For small and medium-sized businesses (SMBs), a strategic vendor can provide ongoing services and continually optimize the cloud environment as companies migrate applications and move towards a digital business model. Navigating the complex and ever-changing world of cloud providers is often a skill that SMBs struggle to recruit or retain. A trusted FinOps partner can fill that gap and ensure cloud investments are fully realized. 

IDC recommends that enterprises utilize this Market Glance to find the best partner for their FinOps teams. Ensuring a partner offers all the capabilities and value-added services your teams need will increase your FinOps maturity. IDC believes a mature FinOps practice is essential to delivering business value in today's economic climate.

Finding the Right FinOps Partner

The importance of cloud FinOps in organizations is on the rise. However, with varying FinOps maturity across organizations, it is essential to find the appropriate partner who can help adopt FinOps and optimize cloud costs. CloudKeeper is an AWS cost optimization and FinOps solution that offers savings, software, and services, all bundled into one solution. An AWS Premier Consulting Partner, CloudKeeper has helped 300+ businesses over 12+ years to achieve instant and guaranteed cost savings right from Day 1. Learn more about CloudKeeper here.

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