Building a cloud-native infrastructure from scratch: is it worth the cost?
The driving force behind cloud-native technology is the pursuit of swiftly transforming ideas into customer experiences in the market. While tech giants like companies like Netflix and Lyft are already taking advantage of cloud-native infrastructure, the rest of the industry is quickly looking to embrace it, with a forecast of 90-95% of apps to be cloud-native by 2025.
As businesses rapidly digitize, their aim is to deliver enhanced, faster customer experiences to boost growth. Such experiences could involve dynamic personalization along purchasing channels, enabling customers to visualize bespoke product configurations before buying, or compare features side-by-side. In a cloud-native architecture, IT and business can efficiently convert customer suggestions or business owner ideas into application software.
The term “cloud native” has evolved since big tech transformed itself using cloud technologies, redefining software development. However, the complexities and risks have limited cloud-native adoption to a few industry leaders.
Challenges and costs of cloud-native development
Although cloud-native development has numerous benefits, it is not always a straightforward process. The core of this approach involves containerization and Kubernetes, which is the container orchestration platform of choice for most companies. However, Kubernetes can become incredibly complex, and experienced practitioners are scarce.
Companies that deploy it often have to dedicate significant resources to configure and run their development operations properly. Additionally, there are other challenges that IT leaders need to consider when building cloud-native apps, including retraining teams on microservices architecture, learning and assembling individual cloud-native services for security, networking, data, and retooling DevOps processes.
These challenges can increase complexity, resulting in higher costs, including recruiting a team of cloud-native dev experts, building the environment, and scaling it. This cost depends on several variables, such as company size, in-house skills, the country where the team is hired, the current operating model, and the modernized app portfolio.
For instance, let’s consider ‘Atom’, a hypothetical US-based composite insurance company with a wide range of apps that need modernization. Atom has a sizable team of developers based in the US, but lacks in-house expertise in cloud-native technology. Its development teams predominantly employ a traditional linear waterfall model, contrasting with the rapid, iterative style common among cloud-native developers.
Atom hires an external consultant to support the IT manager during its planning phase. The consultant helps Atom identify four main initiatives spanning two phases: infrastructure environment and application development.
According to OutSystems’s Cloud-Native Development Report: The High Cost of Ownership, to launch the infrastructure for its new web portal, mobile companion, and back-office app, Atom needs to hire and onboard 12 new team members in the US with specific expertise in cloud-native technologies. This will cost the company US$663,000. Building and configuring the infrastructure environment will cost US$1.2 million, while maintaining and scaling the infrastructure environment will cost US$870,000.
The next phase involves training and reskilling in-house developers, as well as app development with traditional coding, costing a total of US$2.9 million. Training and reskilling existing developers will cost US$340,000, while traditional application development will cost US$2.6 million. During the 12-month development period, 17 traditional coders will work in three teams, and the application development team will collaborate closely with the cloud-native infrastructure team.
Factors affecting costs in transitioning to cloud-native infrastructure
The costs associated with transitioning to a cloud-native infrastructure depend on several factors. One of the most significant factors is the complexity of the app portfolio, which impacts the architecture and infrastructure requirements, necessary tools and skills, and team size.
For instance, if a company only needs a simple internal app, such as a vacation planning app, there is no need to shift to a cloud-native infrastructure or hire a new team of skilled developers. Only one or two developers with the necessary skills can handle the requirement.
The second variable affecting costs is the type of business and its apps. The number of users accessing the apps, geographical distribution of the business, and areas of operations determine the need for geographical redundancy, number of billing regions for the CDN, number of firewalls, and compute resources.
The third variable is the IT department’s operations, which may impact costs based on the location of the IT department, hiring strategy (in-house development, outsourcing, or hybrid model), and existing development culture (waterfall, agile, DevOps).
Low-code meets cloud-native: the future of rapid application development
Building a cloud-native development infrastructure from scratch can be costly, complex, and variable, making it difficult for many IT departments to adopt Kubernetes, cloud-native technologies, and microservices. The process can take several months to years and require millions of dollars before developers can begin building their first application. So, how can organizations leverage the benefits of cloud-native development without adding additional effort and resources to configure and manage it?
One possible approach is to use a platform like OutSystems, which integrates a state-of-the-art cloud-native infrastructure into its low-code offering. This allows organizations to enjoy the agility, scalability, security, and availability benefits of cloud-native development without needing specialized expertise or significant financial outlay.
The OutSystems high-performance, low-code platform uses visual development tools and automation to accelerate the application development lifecycle. This means organizations can utilize a ready-made cloud-native infrastructure, enabling existing teams to deliver applications more quickly. They can do this without the complexity of traditional coding or the need for specialized cloud-native expertise.
Combining low-code and cloud-native development methodologies can help organizations rapidly develop applications that drive revenue, reduce costs, and manage risk at an internet scale.
OutSystems offers a practical solution to the challenges of a cloud-native world. Its high-performance low-code platform aims to enhance developer productivity, enabling organizations to start creating mission-critical cloud-native applications from day one, without the complexities and costs of building their own platforms. To learn more about OutSystems, click here.
- NVIDIA and NTT DOCOMO revolutionize telecom services with world’s first GPU-accelerated 5G network
- Sony battles new hack: ‘Is my account safe?’ Echoes among concerned customers
- GlobalFoundries opens Malaysian office, seeks funding from U.S. CHIPS act
- Can we expect a new AI from Amazon soon, given its up to US$4 billion investment in Anthropic?
- Oracle Fusion Data Intelligence pioneering the change in analytics