Understanding the hidden costs of cloud services
A detailed cost breakdown showing how the major cloud providers extract 10-100x the actual value
Microsoft charges $36/user/month for Office 365 E3—that's $21,600/month for 600 users.
Google Workspace? $18/user/month → $10,800/month for the same team.
But what's the real cost to deliver these services?
Big Tech's pricing isn't based on real infrastructure costs—it's based on:
| Service | Microsoft | AWS | IBM | Open Source | |
|---|---|---|---|---|---|
| Email & Calendar | $4.00/user | $6.00/user | N/A | $5.00/user | Stalwart Mail ($5 total) |
| File Storage (1TB) | $2.00/user | $2.50/user | $23.00/TB | $3.50/user | MinIO ($10 total) |
| Office Suite | $6.00/user | $0 (Docs included) | N/A | $8.00/user | OnlyOffice ($0) |
| AI Assistant | $30.00/user (Copilot) | $30.00/user (Gemini) | $0.20/1k tokens (Bedrock) | $25.00/user (Watsonx) | Local LLM ($15 total) |
| Video Conferencing | $4.00/user (Teams) | $0 (Meet included) | $0.003/min (Chime) | $5.00/user (Webex) | Jitsi ($0) |
Key Insight: AWS charges per-usage making costs unpredictable, while Microsoft/Google/IBM push per-user pricing that scales linearly regardless of actual usage.
Meanwhile, open-source alternatives prove the actual cost is ~100x lower.
| Role | Microsoft | AWS | IBM | Open Source | |
|---|---|---|---|---|---|
| Cloud Architects | 2-3 (Azure specialists) | 2-3 (GCP specialists) | 2-3 (AWS specialists) | 2 (IBM Cloud specialists) | 1 (Generalist) |
| Security Compliance | 3-4 (FedRAMP, HIPAA) | 3-4 (Same as MSFT) | 3-4 (Same as MSFT) | 3-4 (Same as MSFT) | 1 (OSS security expert) |
| Vendor Management | 1-2 (License specialists) | 1-2 (Same as MSFT) | 1-2 (Same as MSFT) | 1-2 (Same as MSFT) | None required |
All major vendors require specialized teams, while open-source solutions need generalists who understand underlying technologies rather than proprietary systems.
| Cost Type | Microsoft | AWS | IBM | Open Source | |
|---|---|---|---|---|---|
| Data Egress Fees | High (Azure bandwidth) | High (GCP bandwidth) | Extreme ($0.09/GB after free tier) | High (IBM Cloud) | None |
| Compliance Certifications | $25k+/year | $25k+/year | $25k+/year | $25k+/year | Included |
| Training & Certs | $15k/team/year | $15k/team/year | $15k/team/year | $15k/team/year | Community knowledge |
AWS's data egress fees are particularly predatory - charging $90 per TB after the first free GB, making it economically impossible to leave once you've committed significant data.
When comparing Microsoft (vendor lock-in), Google (data mining), AWS (egress fees), and IBM (legacy complexity), the open-source stack emerges as the only rational choice for cost-conscious organizations.
The combined annual savings for a 500-person company exceed $2.4M compared to any Big Tech provider, with the added benefit of complete data sovereignty and no artificial limitations.
| Role | BigTechs | Open Source |
|---|---|---|
| Infrastructure Engineers | 2-3 (Cloud specialists) | 1 (Generalist with IaC skills) |
| Security Team | 3-4 (Compliance specialists) | 1 (OSS security expert) |
| Application Support | 5-6 (Per-product specialists) | 2 (General Bots administrators) |
| Licensing Management | 1-2 (Full-time role) | None required |
Key Insight:
BigTechs's ecosystem requires 3-4x more specialized staff than open-source alternatives.
| Component | BigTechs | Open Source |
|---|---|---|
| Compute Resources | $8,400/mo (Cloud E3 instances) | $1,200/mo (Equivalent VMs) |
| Storage | $2,500/mo (Cloud Blob Storage) | $300/mo (MinIO on bare metal) |
| AI/ML Services | $15,000/mo (Copilot + Cloud AI) | $800/mo (Self-hosted LLMs) |
| Networking | $3,200/mo (ExpressRoute + Egress) | $400/mo (Standard bandwidth) |
Average Savings:
87-95% reduction in core infrastructure costs
| Cost Category | BigTechs E3 Stack | Open-Source Stack | 5-Year Difference |
|---|---|---|---|
| Software Licensing | $1.8M | $0 | 100% savings |
| Infrastructure | $1.2M | $180K | $1.02M saved |
| Personnel | $3.5M | $900K | $2.6M saved |
| Compliance | $350K | $50K | $300K saved |
Total 5-Year Savings: $4.92 Million for a 500-person company
BigTechs's pricing model extracts $1,640/year per employee in pure profit— money that could fund your own engineering team to build better, customized solutions.
The enterprise software market is undergoing its "Linux moment"—the question isn't whether you'll switch, but when.
This component transforms abstract SaaS complaints into concrete financial evidence that CFOs and CIOs can't ignore. The numbers reveal BigTechs's business model depends on:
The conclusion is unavoidable: Enterprise SaaS is the biggest profit center in tech history, built on overcharging for commodity services.
General Bots® LLM and custom AI models.
Rio de Janeiro - São Paulo - Paraná
Brazil
+55 21 4040-2160