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Cloud Chargeback Part 3 – Establishing the Price of Your IT Services

By Rich Bourdeau

Once you understand the fully burdened costs of your infrastructure you will need to translate those costs into the prices you will show or charge the consumers of your IT services.  There are Price tagtwo approaches to configuring pricing info.  The first is to associate a price to the service.  For example:  small VM costs $x.  This works great if you only have a few different types and sizes of VMs.

The other option is to associate costs to your individual resources and have the prices of the service determined by the amount of resources the service consumes.  This approach works best for companies with a large number of possible resource configurations.  To minimize the number of service blueprints, they configure a single blueprint with variable resources with min-max thresholds.  When the user selects a given service the cost of their machine or application is determined by the specific amounts of resources that they request.  This pricing methodology also allows the cost to be adjusted if the users requests additional resources at a later date.

Regardless of which pricing model you choose you will need to configure cost profiles or rate policies in your cloud management software.

How VMware vRealize Suite Helps

VMware vRealize™ Automation (formerly vCloud Automation Center) supports a number of pricing models than enable showback/chargeback of the services it delivers.   Prices can be associated with service blueprints.  Prices can also be associated with different infrastructure resources (CPU, memory, storage).  The price of the service is then prorated based on the amount of each resource consumed.  vRealize Automation also supports a third model where cost can be both associated with the specific service as well as the resources consumed.  This option facilitates differentiating two services that have the same resource configuration, but may have different software components which cause the price to be higher for one than another.

vRealize Suite provides two approaches to configuring service pricing policies

  • Manual – Using the vRealize Automation console an Infrastructure administrator can define the costs of each type of compute resources in their environment.  When defining a service blueprint a Tenant or Business group administrator can add additional costs to the service definition.
  • Automated – As discussed in the previous post Cloud Chargeback Part 2 – Understand Your Costs, vRealize Business Standard Edition (formerly ITBM Standard Edition) helps you understand the fully burdened costs of your infrastructure resources.  In addition, it can also convert these resource cost and auto populate vRealize Automation’s cost profiles for each different type of resource you may have.  This integration greatly simplifies the configuration and accuracy of pricing information.

To learn more about this vRealize Suite simplified pricing capabilities I recommend that you watch this short video on Managing Infrastructure Fabric – Assigning Costs (6:32).

vRealize Assigning Costs Video copy

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