Cloud Digital Leader Why Cloud Technology Can Transform Business Practice Question
A company is evaluating Total Cost of Ownership (TCO) for migrating from on-premises to Google Cloud. Which cost is typically reduced or eliminated in the cloud?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Data center facility and hardware maintenance costs
On-premises costs like data center facility, power, cooling, and hardware maintenance are eliminated in the cloud, as the provider manages the infrastructure.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
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Software subscription fees
Why it's wrong here
Software subscription fees are licensing costs that remain largely unchanged whether software runs on-premises or in the cloud. Many enterprise applications are offered as SaaS or require per-CPU licensing that follows the workload, so migration does not eliminate these recurring fees. Therefore, they are not a cost unique to either deployment model and would not be removed in a TCO assessment.
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Cloud storage costs
Why it's wrong here
Cloud storage costs are a metered expense based on gigabytes stored and operational access tiers, such as S3 or Azure Blob. In an on-premises environment, storage is a capital expenditure bundled into server and SAN hardware, whereas the cloud charges separately for each byte, potentially adding a new line item. Thus, while on-prem storage was part of infrastructure spending, cloud storage represents additional, ongoing operational cost that does not disappear.
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Internet bandwidth costs
Why it's wrong here
Internet bandwidth charges do not disappear on migration; egress from Google Cloud to the public internet is billed, and on-premises circuits are often retained for hybrid connectivity, so this line item typically persists or shifts rather than being eliminated. It is tempting because cloud providers absorb internal network transport, and this reasoning would hold for inter-zone or intra-region traffic within the provider's network.
- ✓
Data center facility and hardware maintenance costs
Why this is correct
Data center facility and hardware maintenance costs are eliminated because the cloud provider owns and manages the physical data center, including power, cooling, security, and equipment lifecycle. The infrastructure is shared across many tenants, allowing the provider to achieve economies of scale that lower per-unit cost. In a TCO model, these capital expenditures and operational expenses for physical assets are replaced by a consumption-based subscription, directly removing the need for facility leases and hardware refresh cycles.
Go deeper
Related to this question
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Data Sovereignty and Compliance on Google Cloud
Key term
TCO
Total Cost of Ownership (TCO) is the complete cost of owning and operating an IT asset over its entire lifecycle, including purchase, maintenance, support, energy, and disposal costs, not just the initial price tag.
Key term
Data
Data is raw, unprocessed information, like numbers, words, or measurements, that can be stored, processed, and analyzed by computers.
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Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This GCDL practice question is part of Courseiva's free Google Cloud certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the GCDL exam.