[This is a sponsored article with Synology.]
The cloud was supposed to eliminate the infrastructure headache. Instead, some businesses find a new one: invoices are no longer understandable.
Storage fees, data recovery costs, and backup support costs are quietly pushing cloud adoption beyond expectations for many organizations—and artificial intelligence (AI) is about to make it worse.
It’s a challenge for a Taiwanese storage company Synology he has been watching closely.
At Computex 2026 in Taipei last week, the company argued that the economics of cloud infrastructure are starting to change.
The ever-growing cloud bill
Businesses that enthusiastically moved to cloud infrastructure in the early 2020s are now sitting with debts unlike the ones they signed up for. As costs continue to rise, some are reassessing whether storing more data locally can make better financial sense.
The main catalyst is artificial intelligence.
AI doesn’t just store data—it’s always accessing, moving, and processing it. Every descriptive call, every training model run, every search query pulls data from storage.
Gartner predicts that more than 80% of businesses will have deployed AI-enabled applications by 2026. And in the cloud environment, all those functions come with a price tag.
From the beginning, cloud storage has been sold largely on a simple calculation: the cost of storage per gigabyte. Amazon Web Services S3 Standard, for example, works out to about US$23 per terabyte per month, with Google Cloud and Microsoft Azure in the same range.
For most businesses, the math seemed straightforward. But what is not so obvious is all that is placed on that level of foundation.
Every time data is retrieved or transmitted—something AI workloads do regularly—cloud providers charge an extra fee.
On AWS, data outbound starts from around $0.09 per gigabyte transferred out. At scale, even restoring a 10TB dataset can quietly add about US$700 to the bill, before factoring in anything else.
Add API requests, regional replication, and costs associated with backup, the total cost can be pushed up to four times the advertised backup rate.
A Backblaze survey of more than 400 IT leaders found that 95% have experienced unexpected cloud storage costs. And according to the Wasabi Global Cloud Storage Index, which surveyed 1,600 IT decision makers around the world, including 525 across APAC, 63% of organizations in the region have exceeded their cloud storage budget by 2024.
Businesses retrieve data in-house
Amid rising costs, cloud backup—relocating data and workloads from public cloud providers to private or on-premises infrastructure—has moved from a niche IT discussion to a mainstream business decision.
The 2025 Barclays CIO survey found that 86% of enterprise CIOs plan to move at least some workloads back to independent or existing systems, the highest level on record. The Flexera 2025 State of the Cloud report similarly shows that 21% of workloads have already been restructured, even as overall cloud adoption continues to grow.
However, it is important to note that most organizations are not abandoning the cloud wholesale.
Instead, they take a hybrid approach by maintaining cloud platforms for global accessibility and interoperability, while bringing back workloads involving heavy maintenance, security, and processing. Backup and production are among the things that are often returned, as these are the areas where costs add up the fastest.
For businesses in Singapore, there is another factor at play: the law. Under the MAS Technology Risk Management guidelines and PDPA obligations, companies are expected to know where their data is stored and how it is accessed.
That becomes difficult in large public cloud setups, where data can be distributed across multiple regions and servers. On-premise systems, in contrast, make it easier to keep track of where information resides and who has access to it, as everything is managed within the company’s infrastructure.
What Synology brings to the table
Synology is one of the companies creating this change.
The company is best known for its Network Attached Storage (NAS) hardware—hardware that stores data locally while still operating as a private cloud.
At Computex 2026, it revealed how it is expanding its NAS ecosystem beyond storage into an AI-enabled data management and backup infrastructure.
At the heart of this push is Synology’s next-generation DiskStation Manager (DSM), the operating system that powers every Synology NAS device.
The Taiwanese firm has spent more than two decades developing NAS hardware and software. Today, it has shipped more than 14 million programs worldwide, managing more than 400 exabytes of data.
AI that lives in the house
At Computex 2026, the company announced the roadmap for the next generation of DiskStation Manager, DSM Agent 2.0, expanding it from a storage operating system to an intelligent data platform for AI-controlled, on-premises workflows. The goal is to transform DSM from a storage system into an intelligent data platform that can support AI tools that work with the company’s own infrastructure.
Instead of sending data to external cloud services, businesses can use their own data, such as files, system logs, and usage data, to power AI tools internally, while keeping everything under their control.
“The next generation of DSM leverages more than two decades of technology to create an AI-ready platform that keeps organizations firmly in control of their data,” said Philip Wong, Chairman and CEO of Synology.
Other AI features available include a chat assistant for troubleshooting and system management. More advanced AI agents are also being developed, designed to handle tasks such as email writing, formula searches, meeting transcription, and real-time translation, though no release date has been announced.
As these capabilities increase, privacy becomes even more important in the age of AI. The system already includes a feature that encrypts sensitive data like names, ID numbers, email addresses, and financial information locally before anything is sent to external AI providers like OpenAI or Azure AI.
Future updates will go further, with full support for large language models, where no data needs to leave the organization’s infrastructure.
Synology’s infrastructure is already operational in Singapore
The value of an on-premise data infrastructure is already clear to businesses in Singapore using Synology.
Food chain I Love Taimei, which has 17 stores in Singapore, uses Synology’s DSM system to manage surveillance images in all locations. This reduces management time by 65% and allows the company to run AI-enabled customer analytics without sending images to the cloud.
LASALLE College of the Arts also uses Synology NAS for file storage and 4K video collaboration, allowing students and staff to easily access large project files across Mac computers without compatibility issues or increased costs.
Together, these examples show why some organizations are rethinking the idea that everything is in the cloud.
Reducing storage costs outside of the cloud
The same pressure to understand a highly managed, on-premises infrastructure also extends to backup. At Computex, Synology presented ActiveProtect Manager 2.0, a centralized backup system that will be launched in Q3 2026.
An important issue to discuss is cost. Most support services charge per server, virtual machine, or device. ActiveProtect instead charges the hardware, with no additional cost per workload.
In some cases, customers have seen a lower cost of ownership. For example, Taiwanese media company Info Times reduced setup costs by 65% and reduced storage requirements by 75%. Toyota has also reduced its data backup by 75% with improved storage efficiency.
ActiveProtect 2.0 works with existing systems, so companies don’t need to change their current setup. It also uses machine learning to detect unusual backup activity and help prevent ransomware infections from returning.
And because everything is stored locally, recovery is faster—taking hours instead of days—and there are no cloud data transfer fees.
Big picture
Clouds still have an important role to play, be it for global access, additional computing capacity, or regional support teams.
What is changing is that businesses are becoming more selective about what they store in the cloud. Rather than moving everything to one location, many decide where data should live based on cost, performance, and compliance requirements.
For businesses in Singapore that have quietly accepted rising cloud bills as part of the cost of doing business, it may be time to take a closer look at the numbers.
Check out Synology solutions here.
Featured Image Credit: Synology
