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A new study from Backblaze and Dimensional Research has exposed the significant and often hidden costs of cloud object storage, revealing that these expenses are actively reshaping enterprise infrastructure strategies. As AI adoption accelerates, organizations are finding that their innovation is being throttled not by technological limits, but by unpredictable cloud economics, particularly steep egress fees.
A new study reveals 95% of organizations face unexpected cloud storage charges.
High egress fees are the primary culprit, blocking multi-cloud strategies for 58% of firms.
AI and analytics workloads are severely impacted by these cost barriers.
To cope, 56% of companies are shrinking datasets, limiting future AI potential.
Over a third are curtailing dataset usage, and 21% are reducing headcount.
The findings are driving a market shift towards transparent, multi-cloud alternatives.
The survey of IT leaders managing large-scale cloud infrastructure found that surprise charges are nearly universal, with opaque billing models and data movement costs being the main drivers. This issue intensifies with scale, making enterprises with over five petabytes of data the most vulnerable to budget overruns that can disrupt operations and stall digital transformation initiatives.
The research highlights a direct conflict between the needs of modern AI workloads and traditional cloud pricing models. Because AI depends on massive, accessible datasets, companies are being forced into difficult trade-offs that compromise their long-term capabilities. Over half of organizations are shrinking their stored datasets to control costs, while 46% are tightening data retention policies, which reduces the data available for future AI training and advanced analytics. In more drastic measures, some companies are curtailing usage or even reducing staff allocation to cover storage overruns.
These findings underscore a critical inflection point for enterprise cloud strategy. The ability to move data freely and affordably is no longer a convenience but a strategic necessity in an AI-driven world. The market is responding with a growing preference for best-of-breed providers over single-vendor lock-in, signaling a demand for more transparent and predictable cloud storage economics to fuel, rather than hinder, innovation.
Backblaze is the cloud storage innovator delivering a modern alternative to traditional cloud providers. We offer high-performance, secure cloud object storage that customers use to develop applications, manage media, secure backups, build AI workflows, protect from ransomware, and more. Backblaze helps businesses break free from the walled gardens that traditional providers lock customers into, enabling them to use their data in open cloud workflows with the providers they prefer at a fraction of the cost. Headquartered in San Mateo, CA, Backblaze (NASDAQ: BLZE) was founded in 2007 and serves over 500,000 customers in 175 countries around the world.
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