A marketing firm is considering migrating their data analysis operations to the cloud. The firm is evaluating the cost structures and wants to understand how cloud services might offer economic advantages over their current on-premises solution. Which of the following statements best describes the cost difference they should consider?
By using cloud services, the firm can reduce their high fixed costs associated with maintaining on-premises hardware and instead pay for computing resources as they use them, offering better cost flexibility and scaling.
The transition to cloud services will increase their fixed costs due to the requirement of purchasing the cloud infrastructure outright, but it will lower their ongoing operational expenses.
The firm will incur higher variable costs with cloud services since they will be leasing hardware rather than owning it, leading to increased long-term expenses.
Migrating to the cloud will have no significant impact on their cost structure, as fixed and variable costs are similar in both on-premises and cloud environments.
With cloud services, organizations can replace large upfront capital expenditures-such as purchasing servers and building data centers-with operating expenses that scale with actual usage. Instead of owning and maintaining hardware regardless of demand, the company pays only for the compute, storage, and other resources it consumes. This pay-as-you-go, variable-cost model offers flexibility and aligns spending with business needs. In contrast, an on-premises environment requires fixed investments that remain on the books even when utilization is low. The incorrect options either reverse this relationship or claim no meaningful change.
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AWS Cloud Practitioner CLF-C02
Cloud Concepts
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