While this method is useful, it doesn't account for workload, applications, infrastructure, and business priorities that change over time.
Cloud strategy is also central to this discussion. While Atlantic BT cloud-based services fit into your overall planning, you still need a clear budget and realistic expectations. Forecasting helps by giving you a model you can adjust as your plans and usage change.
What Cloud Spending Data Should You Analyze Before Building the 2027 Budget?
Good IT budget planning starts with understanding what is driving current cloud costs.
Begin with historical cost and usage data, then look beyond the totals. Which workloads, applications, or services drive that spending? Are there recurring patterns, unexpected increases, or services that have gradually become more expensive to run?
Known changes also matter. A planned migration, new application, or other infrastructure change may affect future usage.
The goal is to create a baseline that reflects both what has already happened and what is expected next. That gives the 2027 forecast a stronger foundation than simply carrying forward the previous year’s total.
How Can You Forecast Cloud Usage for 2027?
While your previous bills and records reveal your usage behaviors, you shouldn't treat them as a prediction of your next year's numbers.
A lot can change, from project launches to retiring old systems and changing user counts. For cloud cost forecasting, consider expected workload growth and changes to applications and infrastructure.
When demand is less certain, multiple reasonable scenarios can help. A base case might reflect the expected level of activity, while alternative scenarios can show what happens when key assumptions change.
That approach is particularly useful when project timing, staffing, system expansion, or customer demand is difficult to predict precisely.
The forecast shouldn't stay untouched once the year begins, either. Revisiting it regularly helps keep expected spending tied to current plans, not assumptions that may no longer apply.
Which Hidden Cloud Costs Can Cause a 2027 IT Budget to Go Over Plan?
Image: Money being burned away by hidden cloud costs | Jp Valery via Unsplash
A cloud budget can become incomplete when it focuses only on obvious compute charges. Depending on the services in use, costs may also be affected by:
- how long resources run;
- how much data is stored;
- how much data is transferred;
- how much data is processed;
- the number of requests or invocations.
Cost drivers won't equally matter in every environment. However, you should identify which drivers apply and whether your forecast already reflects them.
You should also distinguish regular, predictable expenses from those that change more often. This helps you identify the steady parts of your budget and the parts you may need to watch more closely.
How Should Discounts, Commitments, and Cloud Contracts Be Included in the 2027 Budget?
Review your usage and pricing arrangements together. Discounts based on commitments or negotiations can affect your rates, but how much technology you plan to use is still important. Looking at past and expected usage can help you see if your current commitments match your 2027 budget.
Teams should review when agreements start or end, check if expected usage still matches the commitment, and see if planned workload changes could affect how much of the agreement you use.
Your forecast should use the rates you expect to pay, but don’t assume that a longer commitment or a certain discount will always save you the most money. It’s better to look at contract terms together with realistic expectations for future usage.
How Can FinOps Help Keep the 2027 Cloud Budget on Track?
Your forecast shouldn't stay still after approval.
You still need to compare your budget, forecast, and actual spending as the year goes on. This helps you identify changes in your usage and numbers that can affect the forecast. And if you spot any, you should update the forecast immediately, instead of waiting until the next budgeting meeting.
Regular reviews also give technical and finance teams a shared view of current spending. Instead of treating the budget as a once-a-year document, they can keep it connected to actual usage and the organization’s latest plans.
In conclusion
Realistic cloud cost forecasting for 2027 comes from analyzing and interpreting real costs and usage data. It also accounts for any changes in billing and contracts, continuously comparing your business's actual spending and your budget throughout the year.
How is your business preparing for its next cloud budget? Share your thoughts, challenges, or experiences with the author to help others working through similar planning decisions.
