Today Civo announced the release of a joint whitepaper with cloud contract specialists, Canopy. Titled "The Cloud Credit Trap," the whitepaper lifts the lid on the hidden costs and long-term risks associated with the widespread practice of offering "free" cloud credits by major hyperscale cloud providers.
As cloud infrastructure becomes a critical component for modern businesses, the lure of upfront cost savings through promotional credits from providers such as AWS, Google Cloud, and Microsoft Azure is growing. But according to Civo and Canopy, these incentives often come with strings attached; namely vendor lock-in, opaque billing, and suppressed innovation.
"The tactic, employed by the dominant hyperscalers, is akin to a drug dealer offering free samples," said Mark Boost, CEO of Civo. "In the short term, customers are hooked into using the platform, but in the long term, they are left trapped and dependent.”
Uncovering the illusion of free
The whitepaper examines how hyperscale providers strategically use credits, sometimes as high as $300,000 for AI startups, to draw users into proprietary ecosystems. These offers often incentivise deep integrations with platform-specific services that are difficult and costly to untangle from once the credits expire.
James Marks, Founder of Canopy, added: "What appears to be generous support for innovation can quickly spiral into escalating bills, limited flexibility, and diminished competitiveness. Businesses deserve better."
- The false economy of free credits: Promotional offers often mask long‑term cost burdens.
- Vendor lock‑in by design: Deep technical integration creates operational dependence.
- Wasted cloud spend: Research shows 28 % of cloud spend is wasted due to misaligned incentives and poor architecture.
- Real‑world case studies: Comparing the trajectory of businesses that accepted hyperscaler credits versus those who opted for transparent providers like Civo.
- A roadmap to cloud freedom: Recommendations for organisations to escape the credit trap, including choosing open standards and predictable pricing.
Civo and Canopy argue that now is the time for a reset in how businesses approach cloud infrastructure.