Utility Billing

In the cloud industry, utility billing refers to the concept of service providers billing customers for resources on a pay-per-use basis, rather than a fixed/lumpsum amount. The concept allows users to minimise their costs and increase usage efficiency since the billing is done only for resources consumed.

Points to Remember

  • The term utility billing originates from its association with conventional utilities such as electricity and water, where service providers bill customers based on the amount consumed.
  • The model is increasingly gaining in popularity in the cloud industry, thanks to the flexibility it provides to customers, who technically have access to a large number of resources but are only expected to pay for their usage.