Management

How Can Metered Consumption Help Higher Ed Save Money?

Colleges and universities can take a more financially savvy approach by paying only for the resources they use.

Tim Hanrahan is manager of CDW's cloud client executives team. His focus is on helping determine the best direction for a client solution across CDW’s cloud portfolio.

With no end to the pandemic in sight, higher education institutions need new strategies to confront budget shortfalls. Now is a good time for colleges and universities to consider adopting a metered billing structure. After all, why pay for more than what you use?

Metered consumption, also known as a pay-per-use billing model, is common in corporate organizations. And there are several ways this billing process can be applied in higher education.

Although capacity planning for a higher education institution’s data center, cloud, software and infrastructure resources may be necessary in some cases, this approach is often expensive and wasteful. Let’s explore how the pay-per-use operational model of metered billing can help colleges and universities cut costs.

What Do Metered Consumption Payment Plans Look Like?

Instead of forking down a lump sum every year, colleges and universities can pay a much smaller (and fairer) bill each month.

Let’s look at data storage as an example. If you use capacity planning to forecast storage needs, you might purchase 100 terabytes of storage for the year but end up using only 50TB. With metered billing, you would have to pay only for the little bit that you use each month.

But you can still use a capacity planning model for certain services if you want to. After all, there are certain mission-critical resources you might feel more comfortable reserving in advance. And you can often receive discounts for taking this approach.

For example, if you know there is a minimal amount of software resources that you will definitely need for the year, you can receive a discount for committing to a yearlong purchase. This is called a reserved instance. These are generally one-year and three-year options that offer up to 70 percent discounts for customers.

MORE ON EDTECH: Learn how Software Asset Management can help higher ed save money.

How Metered Consumption Can Improve Remote Learning

As remote learning grows, we also have to consider our end users. Using a cloud-based e-learning tool offers potential metered consumption on a user level and brings a host of other benefits.

For staff, it provides pre-made templates, collaboration platforms and multimedia features. For students, it provides better performance, because most cloud-based e-learning platforms are built on a distributed cloud system. This distributed model provides more points of presence in many regions, thus allowing students to access content more easily.

With the rise of online learning — and the decline in budgets — it’s time to reap the financial benefits of metered consumption.

This article is part of EdTech: Focus on Higher Education’s UniversITy blog series.