With shrinking IT budgets and mounting cloud costs, enterprises today face a stark reality: much of their public cloud spend isn’t delivering value.
According to the Private Cloud Outlook 2025 report, based on a global survey of 1,800 senior IT decision-makers:
- 49% of organizations estimate that over 25% of their public cloud spend is wasted.
- 31% believe the waste exceeds 50%. That’s a level of inefficiency that few leaders can tolerate.
Early cloud initiatives often launch without rigorous cost governance. Unused compute, under-optimized storage, and unmanaged dev/test environments all contribute to waste. Tracy Woo, principal analyst at Forrester, captures the problem concisely in an article on CIO.com:
“In the rush to the public cloud, a lot of people didn’t think about pricing... Cloud spending is going up and budgets are tightening, so they’re asking what’s going on and how do we right this ship.” (CIO.com)
Add unpredictable pricing into the mix, and cost overruns become inevitable. As Deloitte’s research notes:
“In general, companies are not good at sticking to their cloud budget. Half of organizations surveyed overspent last year, and the average overrun was 15%. One factor is pay-as-you-go billing, which means cost is variable, and can make forecasting a greater challenge.” (Deloitte Insights)
Strategic Workload Planning Comes into Play
Organizations are responding with a more strategic approach. They’re placing workloads in cloud environments that offer the best balance of performance, control, and cost efficiency.
More and more, these environments are private clouds. Two-thirds of organizations are considering workload repatriation from public to private cloud, with one-third having already done so. Among the key reasons? Cost control and predictability.
A whopping 90% of survey participants say they value the financial visibility and predictability offered by private cloud.
Structured Cost Governance in Private Cloud
Enter VMware Cloud Foundation 9.0 (VCF 9.0), the private cloud platform that gives enterprises the capabilities they need to predict and control costs. Key features include the following:
- Predictive Cost Modeling - Comprehensive analytics model not only infrastructure spend but also software licensing and operational overhead, supporting planning and prevention of unexpected expenses.
- Showback and Chargeback - VCF 9.0 introduces granular showback and chargeback reporting. These capabilities provide deep visibility into resource consumption and costs at multiple levels—across teams, workloads, business units, and tenants.
- Automated resource optimization- Built-in automation reclaims underutilized compute and storage resources, improving workload efficiency and reducing waste proactively.
Summary
The Private Cloud Outlook 2025 report makes it clear. Public cloud cost inefficiency is widespread, and enterprises are prioritizing cost predictability through strategic workload placement. Moving from reactive cost‑cutting to proactive cost discipline is essential.
VCF 9.0 embodies that approach. It delivers the tools required for this shift: predictive modeling, granular showback, and automatic optimization within a modern private cloud platform. When combined with structured workload planning and governance, enterprises can cut down on cloud waste and reclaim budget for business priorities.
Read the Private Cloud Outlook 2025 report and learn more about the new capabilities in VMware Cloud Foundation 9.0.