Maximize your cloud spend with Red Hat

Cloud adoption has become quite widespread in recent years, and with that, many organizations are increasing their cloud budgets and their committed spend with their preferred cloud providers.

Committed spend is the value of products or services an organization agrees to purchase from a cloud provider, such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud, within a period of time in exchange for discounted qualifying products, technologies, or professional services in the cloud. 

When your organization makes a financial commitment through a committed spend agreement, the seller will often provide you with qualifying products, technologies, or services at a discount, with more committed spend resulting in bigger discounts. These discounts can, in some cases, apply to both yearly subscriptions and pay-as-you-go options, which allows organizations to better tap into the flexibility of cloud computing to reduce operational costs. 

Without a strategic approach, however, your organization could struggle to achieve your expected savings and be left with an inefficient and costly software procurement process that hinders your productivity and profitability. In fact, research shows more than half of AWS customers between 2022 and 2023 failed to take advantage of the built-in discounts available to them.¹

Procurement teams have a number of options to choose from, including purchasing software and services through a cloud provider’s console or marketplace, as well as a range of spend programs, including committed spend programs through cloud providers and Red Hat’s Hybrid Committed Spend program, which offers discounts in exchange for volume spend commitments.

With the right approach for your organization, you can:

• Increase ease of procurement by purchasing solutions and services from a provider that offers a range of flexible purchasing and deployment options. This allows you to use your existing procurement processes and purchasing agreements, rather than making unnecessary process adjustments or creating new agreements, such as having to create a new purchase order (PO) with a vendor you don’t already have agreements in place with.
• Improve procurement time by finding a provider that offers a full range of solutions and services that meet your entire organization’s needs. This allows you to avoid a lengthy search for new solutions and service providers when a new need arises, and because you would be operating within preexisting agreements, you wouldn't need to initiate new approval processes.
• Simplify billing with a provider that offers consolidated billing between both your software and service purchases and your cloud consumption costs. This efficiency—along with the added efficiency of purchasing from a vendor that you already have billing agreements and processes set up with—allows you to streamline your billing processes and make better use of your existing committed spend. 

In this e-book we will explore how you can maximize your existing committed spend with a cloud provider to purchase solutions and services from Red Hat, while streamlining your procurement processes and realizing significant savings.

To streamline your organization’s procurement process, start by determining where it makes the most sense to make your software purchases from, as well as what type of or combination of consumption models works best for you.

Pay-as-you-go. You can purchase Red Hat® solutions—for example Red Hat Enterprise Linux® instances—directly through your cloud provider’s console or portal on a pay-as-you-go basis. This purchasing option provides quick procurement processes, simplified billing that is included in your existing cloud provider bills, and the option to draw down from your existing spend for eligible products. It should be noted, however, that operating on a pay-as-you-go at full manufacturer’s suggested retail price (MSRP) can reduce your opportunity to create added savings through a prenegotiated agreement with Red Hat and/or a cloud provider. You can check with Red Hat and/or your cloud provider to better understand your ability to receive discounts.

Commitment-based public offer. This procurement option allows you to make an upfront commitment (either monthly or annual commitment) that will make you eligible for a discount. This is a cost-effective option for organizations who know they will consume a specific product or service on a consistent basis for a specified period of time.

Private offer. By creating a contract directly through your preferred cloud provider, or transacting through a Software-as-a-Service (SaaS), your organization can negotiate significant savings by agreeing to a certain level of committed spend upfront. That committed spend can be applied to purchases of Red Hat solutions made directly within the cloud provider’s marketplace. These are traditional subscriptions, also known as static capacity SKUs.

Red Hat Cloud Access (also known as bring-your-own-subscription). This program allows Red Hat customers to run eligible Red Hat product subscriptions on certified public cloud providers, making your subscriptions portable so that you can choose the best architecture and infrastructure for your needs. The terms of your subscription with Red Hat, including pricing, support, and benefits, remain the same. You work directly with your Red Hat sales representative to determine sizing and pricing when moving to a certified cloud provider, while paying the cloud provider separately for cloud usage, but purchases through this program do not count towards your committed spend with that cloud provider.

Selecting the right mix of procurement approach and consumption model is just the initial step in streamlining your procurement process, and should be followed up by selecting the right spend program for your organization’s needs. 

When buying software from Red Hat, you can choose from 2 primary committed spend programs: 

Committed spend agreements with a cloud provider. The major cloud providers offer committed spend discounts on solutions purchased through their individual marketplaces. AWS, Microsoft Azure, and Google Cloud each offer Red Hat solutions, such as Red Hat Enterprise Linux or a managed Red Hat OpenShift® offering, in their console and marketplace, with the option to draw down on your organization’s committed cloud spend. This spend program option helps you save on consumption and third-party vendor solutions purchased directly from the cloud providers’ consoles and marketplaces.

Red Hat Hybrid Committed Spend program. In addition to the discounts that you can access through cloud provider committed spend agreements, you can also receive further discounts on Red Hat products through the Red Hat Hybrid Committed Spend program. This program gives you the option to acquire Red Hat products from either a cloud provider marketplace or directly from Red Hat, while benefiting from volume discounts on the total Red Hat spend with the ability to deploy the products when and where you need them. This allows you to count Red Hat solution purchases from a cloud provider marketplace towards your committed spend with the cloud provider and your committed spend with Red Hat at the same time, while receiving discounts from both. 

By using the Red Hat Hybrid Committed Spend program, you can improve your operational flexibility in a number of ways, such as through:

• The choice to purchase Red Hat solutions through your preferred cloud vendor and deploy those solutions into your preferred operating environment.
• The option to receive volume discount considerations for total spend across all channels and environments.
• The product deployment flexibility found throughout Red Hat’s portfolio, which allows you to shift from 1 product to another on a monthly, weekly, or even hourly basis.
• The option to merge traditional subscription payment models with on-demand subscriptions to maximize procurement and financing flexibility.

To best take advantage of your organization’s existing committed spend, or any future committed spend you may be considering, it’s vital to choose the right solutions for your organization.

Red Hat offers a range of solutions proven to provide operational improvements, such as increased efficiency, improved productivity, enhanced end-user satisfaction, and minimized unplanned downtime. This all comes together to provide a significant return on investment (ROI) for Red Hat solutions.

The key solutions provided by Red Hat include: 

Red Hat Enterprise Linux. Since emerging as Red Hat’s first flagship product 20 years ago, Red Hat Enterprise has become the world's leading paid Linux operating system. It offers customers the freedom and stability to deploy applications and operate anywhere. As a Linux distribution for enterprise use cases, it provides built-in security and management features that allow organizations to confidently run critical workloads on a stable, high-performance platform, anywhere in the hybrid cloud.

Red Hat OpenShift. This hybrid cloud application platform is trusted, comprehensive, and provides a consistent experience on premise, in the cloud, and at the edge.  Organizations and IT teams can grow, modernize, and innovate by using OpenShift as their security-focussed, application development and delivery platform. It's designed to meet developers, platform engineering, and IT operations teams 'where they are,' for a seamless journey towards application modernization and AI integration.

Red Hat Ansible® Automation Platform. Red Hat's primary enterprise automation product offering includes all of the tooling needed for building, deploying, and managing end-to-end automation at scale. Ansible Automation Platform makes it possible for users across an organization to share, vet, and manage automation content by means of a streamlined and agentless technical implementation.

In this chapter, we will break down some of the proven benefits of those Red Hat solutions, including solutions delivered as managed cloud services through a preferred cloud provider.

Red Hat solutions provide:²

• 540% 3-year ROI.
• US$17.31 million higher revenue per year.
• 20% development team productivity gain.
• 23% faster development lifecycle, new applications.

• 32% more efficient IT infrastructure teams.
• 52% faster security updates.
• 72% less unplanned downtime.

Red Hat Enterprise Linux provides:³

• 313% 3-year ROI.
• 12 months to payback.
• 54% reduction in unplanned downtime.
• 34% more efficient infrastructure teams.
• 33% more efficient security teams.
• 33% more productive developers.
• 48% more applications developed per year.

• 19% more productive compliance teams.
• 48% quicker on-premise virtual server deployment.
• 43% quicker cloud-based virtual server deployment.
• 46% quicker to complete security updates.
• 47% quicker to respond to security vulnerabilities.

Red Hat OpenShift provides:⁴

• 203% 3-year ROI.
• 10% improvement in software developer productivity.

• 24-hour reduction in application downtime per end user per year.

Red Hat Ansible Automation Platform provides:⁵

• 668% 3-year ROI.
• 8 months to payback.
• US$8.54 million higher revenue per organization per year.
• 61% less unplanned downtime, better resiliency.
• 38% increase in network management team efficiencies.

• 28% increase in public cloud management efficiencies.
• 36% development team productivity gains.
• 68% faster to deploy new compute resources.
• 23% faster to market for new products and services.

Red Hat Enterprise Linux on Azure provides:⁶

• 192% 3-year ROI.
• Less than 6 months to payback.
• 50% reduction in outage frequency.

• 85% reduction in outage downtime.
• 80% less datacenter spend.

Microsoft Azure Red Hat OpenShift and Red Hat OpenShift Service on AWS provide:⁷

• 468% 3-year ROI.
• Less than 6 months to payback.
• 50% improvement in operational efficiency.

• 70% improvement in time of development cycle.
• 20% of developer time gained back by reduced infrastructure maintenance requirements.

By choosing to purchase Red Hat products through a cloud provider’s console or marketplace, your organization receives proven solutions that can significantly improve your operational efficiency and effectiveness (and that can be flexibly deployed), and you can count that spend towards your existing committed spend agreement with that cloud provider.

Another key distinction to understand before choosing where to purchase your Red Hat solutions is the varied levels of support and price flexibility available through a cloud provider’s console or marketplace listings.

When you purchase Red Hat solutions through a cloud provider’s console, the cloud provider is responsible for providing support at Level 1 (initial inquiry and basic support) and Level 2 (escalated support). Additionally, Red Hat does not determine pricing or offer customer discounts.

Alternatively, when you purchase Red Hat solutions through a cloud provider’s marketplace, Red Hat is responsible for providing Level 1, Level 2, and Level 3 (technical support) support, and has the ability to determine pricing and offer volume customer discounts through private offers. 

Why should I choose AWS for my Red Hat solutions?

With solutions from Red Hat and AWS, you can build, deploy, migrate, and modernize applications in a security-focused hybrid cloud environment. Joint customers benefit from enhanced IT agility in a modern environment, continuous collaborative innovation that reduces management complexity, a robust ecosystem of partners that allows you to choose the tools that work best for your business, and flexible deployment and payment options with multiple consumption models. 

Purchasing Red Hat solutions on AWS allows you to count the costs towards your committed spend agreement (the amount varies per solution) while benefiting from a variety of billing options.

Red Hat Enterprise Linux listings available through AWS

Why should I choose Microsoft Azure for my Red Hat solutions?

When you choose to purchase Red Hat solutions through Microsoft Azure, your organization can take full advantage of an open hybrid cloud approach to maximize ROI, improve performance and business resilience, mitigate operational risks, and prepare to adopt AI tools. Together, Red Hat and Microsoft provide the platforms, partner ecosystems, and collaborative improvements you need to operate in whichever environment you need.

Every Red Hat software solution purchased through Microsoft Azure directly contributes to fulfilling your Microsoft Azure Consumption Commitment (MACC) and is billed through your Microsoft Azure account.

Why should I choose Google Cloud for my Red Hat solutions?

By choosing to invest in collaborative solutions from Red Hat and Google Cloud, your organization can streamline its cloud migration and improve operational efficiency in cloud environments, so that you can focus on your own business innovation. Red Hat solutions on Google Cloud help your organization improve IT productivity by: building on a hybrid and multicloud infrastructure with developer-specific resources and tools; developing security-focused, cloud-native applications with consistency across your infrastructure; managing and automating cloud migration, networks, and infrastructure; and promoting consistency throughout your cloud migration journey.

Purchasing Red Hat solutions on Google Cloud allows you to retire your Google Commit and benefit from a flexible billing model by receiving a single invoice from Google for all solutions.

By choosing to purchase your Red Hat solutions through a cloud provider’s marketplace or console, you can increase the ease of procurement, improve procurement time, and simplify billing, all while using your existing committed spend for proven solutions.

Discover more Red Hat solutions through your preferred cloud provider on the AWS Marketplace, Microsoft Azure Marketplace, or Google Cloud Marketplace.

Or speak to a Red Hatter to learn more about how you can achieve significant operational improvements, while simplifying procurement and billing, by using your existing committed spend with a cloud provider to purchase solutions and tools from Red Hat.