Pay-Per-Use: The Payment Model Of The Future
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Pay-Per-Use: The Payment Model of the Future

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Marketing Manager

Gone are the days of handling servers in-house or paying for expensive pieces of software! With the gradual move to digital commerce, the way customers interact with and pay for services has dramatically changed. Subscriptions and Platform-as-a-Service (PaaS) models are far more convenient for customers, offering inexpensive and suitable methods to run their operations while accompanying their customers’ frequently changing needs.

What is Pay-Per-Use?

When it comes to expensive aspects like E-commerce software, servers, and the like, a smaller business can quickly be bled dry of money in a short amount of time. This is where the pay-per-use (PPU) model comes in to help, allowing customers to pay for exactly what their business needs. Also known as metered services, think of it more as renting out a service from a company instead of outright buying it.

Why Go With This Model?

One of the best aspects of the PPU model is that the barrier to entry is significantly low compared to a typical subscription model. This makes this a great opportunity for smaller and mid-sized businesses that do not have the money for an expensive server setup.

Since you can pay for what you need, the overall commitment you make is entirely up to you. Want to scale back your cloud storage due to less data coming in? Or maybe you want to increase your serverless computing setup to account for more applications? Both are easy to make happen. You can contact an expert at Katalyst today to help modify your plan for to help better fit your workload.

While the PPU model puts you more at the whim of these businesses and how they operate, it also removes a great deal of stress off your back. For example, if you choose to allow AWS—a service that utilizes the PPU model—to handle your cloud storage or virtual servers, they will be the ones to manage, clean up, and maintain your data, leaving you to focus your time and money on other critical tasks.

Why it May Not Be a Good Fit

However, in certain cases a PPU model may often cost you more in the long run. If what you require is only to be accessed or run for a small amount of time, this may be a perfect method. If needed for any longer, you might as well just invest in setting up your own service, as costs build up over time, as well as unexpected bursts in your cloud usage, surprising you with a hefty bill at the end of the month. It may be initially expensive and difficult to set up your own systems, but it will likely save you more in the future.

The scaling mechanism and tiered nature of some PPU models also do not favor customers in transitioning to this new method. While developers may understand the terminology, the average business owner looking to outsource this work to AWS or Azure are not very familiar with how much a megabyte per second ends up being in the long run. It will be vital to speak with a professional to fully grasp what you will pay every cycle for services like Lambda or Azure Disk Storage.