Why memory and storage costs are surging – and what it means for your IT and cloud strategy

These market conditions impact fundamental decisions around infrastructure refresh cycles, budgeting, and cloud adoption. Below are two key implications that IT teams should seriously consider: 

The public cloud will win the total cost of ownership (TCO) comparison against the data center even more often 

Teams often underestimate the impact of rising memory and storage prices on multi-year total cost of ownership (TCO). As hardware capital expenditure (CAPEX) increases, the economic gap between on-premises environments and cloud platforms widens faster than many expect. A structured assessment, such as an Optimization and Licensing Assessment (OLA) storage analysis, helps to quantify the true cost impact, identify potential savings and prevent incorrect assumptions that could lead to suboptimal long-term decisions. Clear data and realistic cost models provide organizations with a far more reliable basis on which to decide between an on-premises refresh, a hybrid model or a full move to the cloud.

In this context, the advantages of the public cloud become even more relevant.

• Operational costs (OPEX) become more predictable compared to capital expenditure (CAPEX)-heavy refresh cycles. 

• Scalability means you don’t have to buy peak capacity upfront. 

• Cloud storage costs can be lower than buying premium hardware, even for block/cold data. 

• AWS has a history of not increasing their prices. Rather, we have seen numerous price reductions in the past due to their economies of scale. 

In other words, the business case for cloud adoption improves as the relative cost of running and upgrading your own infrastructure rises sharply. Cloud ROI models increasingly favor the cloud, especially for storage-heavy workloads. 

Recommendation: Re-evaluate any existing “keep it on-premises” assumptions. Given the surge in memory and storage prices, cloud options are likely more cost-effective overall. Additionally, the new AWS European Sovereign Cloud weakens traditional arguments for keeping data on-premises. 

Note: With our OLA offering, which includes a storage assessment, Skaylink can help you create a quick cost estimation for your IT estate on AWS. Alternatively, we can deliver a complete analysis and migration business case.

If you must refresh storage, do it soon – and plan for a hybrid solution 

For customers planning a hardware refresh, timing is critical. Many vendors are warning that 2025 may be the last chance to secure lower prices before price hikes in 2026. With some vendors, 2025 prices are still available until the end of January.

Key considerations: 

• Lock in 2025 pricing if refreshes are planned. Delays may result in materially higher costs due to expected 2026 price increases.

• Consider hybrid architectures that allow you to intelligently tier data between on-premises and cloud. 

 Hybrid storage can act as a bridge during migration: 

• Cold or infrequently accessed data can be stored in cloud object storage (e.g., AWS S3) at a significantly lower cost. 

• Active or performance-sensitive data can remain on-premises, for example, on fast local arrays. 

Tiering in this way reduces your footprint on expensive on-premises hardware, and gives you flexibility to complete cloud migration without a major upfront refresh. 

Example technologies that support hybrid storage patterns: 

• AWS Storage Gateway: Seamless caching and tiering between on-premises systems and S3 

• NetApp ONTAP: Enterprise-class file storage for data centers, natively supported by all hyperscalers (e.g., AWS FSx for NetApp ONTAP), offers storage efficiency features such as compression or deduplication, as well as cloud tiering capabilities and data lifecycle policies. 

Such services help you hold the line on performance and cost until you’re ready to fully modernize and migrate to the cloud, preventing you from overbuying hardware at inflated prices. 

Note: Skaylink can help you set up hybrid storage solutions on AWS that are both cost-effective and scalable. We can also quickly migrate selected data to the cloud using services like AWS Datasync or Transfer Family, freeing up space on your storage arrays. In addition, Skaylink is an authorized reseller of popular storage solutions from vendors such as NetApp. Please get in touch if you need a quote.