Backblaze and Dimensional Research Reveal Hidden Cost of Cloud Object Storage as Enterprises Confront AI Data Demands

95% of organizations report surprise cloud storage fees; rising egress costs reshape infrastructure strategies and drive demand for transparent alternatives.

SAN MATEO, Calif.--(BUSINESS WIRE)--Backblaze, Inc. (Nasdaq: BLZE), the cloud storage innovator providing a modern alternative to traditional cloud providers, today announced a new study in partnership with Dimensional Research that uncovers how hidden cloud storage costs are driving major shifts in enterprise infrastructure strategies. As AI adoption accelerates, organizations are increasingly hitting a wall—not in innovation, but in cloud bills.

According to the survey of 403 leaders managing over 250TB in the cloud, 95% of companies have been hit with unexpected cloud storage charges, most often due to steep egress fees and opaque billing models. 58% of respondents say the cost of moving or accessing data is now the single biggest barrier to realizing multi-cloud strategies. The challenge intensifies with scale: enterprises managing more than five petabytes of data are the most vulnerable to budget overruns that disrupt operations and stall transformation.

AI workloads meet cloud cost roadblocks

The research highlights the tension between modern workloads and outdated pricing models. AI and advanced analytics depend on massive, fast-moving datasets, but organizations are being forced into trade-offs:

• 56% are shrinking stored datasets to control costs.
• 46% are tightening retention policies, reducing data available for future AI training and analytics.
• 40% are diverting funds from other mission-critical initiatives to cover storage overruns.

Some organizations take even more drastic measures: 37% curtail dataset usage and 21% reduce headcount or staff allocation. 15% perform what might be the most shocking measure by taking no action and simply absorbing the costs.

“The data shows what many IT leaders already know from experience: innovation is being throttled not by technology limits, but by cloud economics via egress fees and unpredictable charges,” said Gleb Budman, CEO at Backblaze. “In a cloud-first, AI-powered world, the question is no longer whether you can afford innovation—it’s whether your current cloud provider will let you.”

Market response and industry signals

With 62% of respondents preferring to select best of breed providers versus one-stop-shops, these findings highlight a growing shift.

The market is responding to cost pressures, with organizations increasingly adopting multi-cloud strategies to avoid single vendor lock-in and unpredictable pricing models. Even the largest hyperscalers are beginning to acknowledge customer frustration with restrictive data movement costs. However, while the study shows enterprises are actively evaluating independent and transparent storage providers, it also found that 97% perceive costs of egressing and moving data and technical complexity as the top two barriers to making the switch.

“This study’s findings are consistent with what we’re hearing across the industry,” said Diane Hagglund, Principal at Dimensional Research and author of the study. “As AI and other data-intensive workloads expand, the ability to move data freely and affordably is no longer optional—it’s a strategic requirement.”

Download the full report: https://blze.ai/DimensionalResearchReport2025

About the Survey

The Backblaze–Dimensional Research 2025 Cloud Storage Survey was conducted from May 24 to June 5, 2025, with a total of 403 respondents responsible for over 250TB of cloud infrastructure. Respondents provided insight into cloud storage challenges, vendor preferences, and the impact of AI-driven data growth on infrastructure strategies.

About Backblaze

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. For more information, please go to www.backblaze.com