Why is Cloud Billing Important to the Service Provider?

It seems like an obvious question. Billing keeps your business ticking, yet the process for billing is often one of the last things to be considered when building out a new service.

As a customer of any utilities, whether personal or business, you expect to receive a bill for the services you use. A detailed bill, for example, that showcases how much gas, water or electricity you’ve consumed. You want to be able to monitor your usage, check figures and call your service provider if you are not happy. So, why would you not expect this of your cloud computing service provider?

However it is important to bear in mind that there are two stakeholders in the billing process – the customer and the service provider.

1. The Customer – As a customer of cloud computing, there will be peaks and troughs in service demands. Giving the customer a clear understanding of what they are paying for will help them monitor SLA’s, provide accurate budgeting and also enable them to resource plan for busy periods. It’s pretty simple – pay for what you need and be able to scale to accommodate business requirements.

2. The Service Provider – As a service provider, the business objective is to sell their products or services to customers. The billing system should never hinder this. Cloud computing accentuates this as a significant challenge. This is because the on-demand, agile and instantly scalable nature of the cloud demands a billing engine just as responsive. Service providers need a billing engine built specifically for the cloud.


The challenge is that most service providers have a legacy billing system; either one that models hosting billing or Telco billing. Unfortunately neither system is sufficiently well suited to the cloud.

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How Cloud.dk built a scalable cloud infrastructure

This week, we completed work on a customer case study for Cloud.dk, Denmark’s first and leading public cloud provider. In it, project manager Maja Lokkegaard explained that Cloud.dk provides the Danish market with a Danish hosted, KVM-based Infrastructure as a Service (IaaS) platform, competing with the international offerings from Amazon and Rackspace. She then goes on to explain how Flexiant Cloud Orchestrator has allowed the Company to provide a highly flexible platform at a cost effective price.

Highly Flexible
Flexibility was one of the key requirements of Cloud.dk when it began looking for a cloud orchestration provider. Flexiant Cloud Orchestrator allows Cloud.dk to tailor its services to meet the individual requirements of its clients. The software allows the Company to add its own features, thus letting it find its own competitive edge and the option to combine pre-paid and post-paid billing options on the platform. It also allows them to, ‘add reseller specific services and product software.’ From a technical point of view, they are also happy with the v2.0 addition of multi-node and multi-cluster control.
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A few Moments on Cloud Billing

Cloud Billing SoftwareCloud billing is not a sexy subject. But billing is what keeps our businesses ticking. The challenge many service providers face is how to bill their customers for their cloud services.

Even for private clouds, billing is important. Being able to meter and rate usage, whether it is for internal chargeback or simply to demonstrate what department is using what resources, requires 90% of a billing system; it might not send invoices, but it does the same thing. If you are a service provider offering a ‘wrapped cloud offering’ where one invoice is produced at the end of each month, which is not directly correlated to usage, you still need to know how much it is costing you. So, for just about every application of cloud within service providers, billing really matters.

There are two main types of billing engines in use in service providers that are looking at providing cloud services. These are:

•    Hosting billing – This is subscription billing; typically billing a fixed amount each month, on a single bill.

•    Telco billing – This type of billing is the sort of billing that your phone company uses, based on CDRs (‘call description records’) which are metered, rated and billed – much like the back page of your phone bill.
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