What is cloud unit economics?
Cloud unit economics is a system that measures the cost and usage metrics associated with dynamic infrastructure changes in cloud computing. It applies the concept of unit economics to the cloud computing domain and calculates the difference between marginal cost and marginal revenue to determine where cloud operations break even and begin to generate profit. While cloud unit economics is often discussed in the context of commercial SaaS and cloud-driven commercial organizations, it can also be applied to non-profit or public sector entities by replacing the terms profit or revenue with value.
Benefits of cloud unit economics
The main benefits of using cloud unit economics are as follows:
- Forecasting profitability and understanding factors affecting margins
- Building a plan for cloud cost optimization
- Evaluating a product’s future potential and making changes to the product roadmap and engineering priorities
- Responsible...
