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Cost Optimization on AWS
Rolf KerstenBusiness Development Manager
A Couple Assumptions…
1. You’re using AWS…
2. You like it!!
3. But probably want to spend less
AWS Pricing Philosophy
More AWS Usage
More Infrastructure
Economies of Scale
Lower Infrastructure
Costs
Reduced Prices
More Customers Ecosystem
Global FootprintNew FeaturesNew Services
Infrastructure Innovation
We pass the savings along to our customers in the form of low
prices and continuous reductions
51
1.Architect for Cost Efficiency„Pay for what Youthink you need“
2. Optimize UsageCosts„Pay for what you use“
3. Take Advantageof Benefitsover Time„Pay for whatyou really need“
Cost Optimization with AWS
1.Architect for Cost Efficiency
2. Optimize UsageCosts
3. Take Advantageof Benefitsover Time
Proactively Monitor Your Account Billing Usage…
By Using Detailed Billing Reports andEnabling Billing Alerts…
EC2 Instance Usage Reports
Cost per Instance Type per Hour, Day or Month
..or…
Instance Hours per Instance Type per Hour, Day or Month
All Data can be exported
More Information: http://docs.aws.amazon.com/AWSEC2/latest/UserGuide/usage-reports.html
Fit your payment model to your business model: EC2 pricing plans
On-DemandInstances
ReservedInstances
SpotInstances
Pay as you go for computing power
Flat hourly rate, no up-front commitments
Pay an up-front fee for a capacity reservation and a lower hourly rate (up to 72% savings)
1-year or 3-year terms
RI Marketplace: Buy RIs with short remaining terms
Pay what you want for spare EC2 capacity: your instances run if your bid exceeds the Spot price
Potential for large scale at low cost: When they’re available, take advantage of 1,000s of Spot Instances at up to 90% savings10:00
10:05
10:10
10:15
Standard Reserved Instances• You commit to pay for an instance for one or three years• We reserve the capacity, and offer you considerable savings over On Demand during the
term• You decide how you pay:
• No Upfront (Just hourly charges for all hours of the term)• Partial Upfont (Upfront Payment, plus hourly charges for all hours of the term)• All Upfront (Upfront Payment only)
Self Service Reserved Instance Utilization Reports
RI „Bucket“
On Demand-
(Usage + amortized upfront fee)
More Information: http://docs.aws.amazon.com/AWSEC2/latest/UserGuide/usage-reports.html
Spot Instance Use Case:HPC Clusters On Demand
• Increase efficiency of solar panels by analysing 205.000 materials
• 156.314 computing cores used at AWS, all regions, for 18 hours
• Bill: $33.000http://blog.cyclecomputing.com/2013/11/back-to-the-future-121-petaflopsrpeak-156000-core-cyclecloud-hpc-runs-264-years-of-materials-science.html
• Base Price - On Demand: No Commitment, Pay only what you use, no capacity reservation but once started no interruption
• 10% less - Scheduled Reserved Instances: Commit to Schedule of at least 1200 hours for one year, capacity reservation
• 30-60% less - Standard Reserved Instances: Commit to one or three years, capacity reservation
• 40-60% less - Spot Blocks: Bid for 2-6 hours blocks of uninterrupted time
• Up to 85% less - Spot: Bid for instances, interrupted if market price higher than your bid price, 2mins advanced notice
An EC2 Cost Optimization Option for every Need
Combine all the Options!1. Start by using RIs for
known/steady-state workloads
2. Set-up multiple autoscaling groups
3. Autoscale first using Spot first4. If Spot instances are
unavailable (or priced too high), use On-Demand
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 240
2
4
6
8
10
/Spot In-stances
On DemandSpotReserved Instance
Trusted Advisor: Enterprise Strength Monitoring and Optimization
• Monitors and recommends optimizations for:
– Cost– Security– Fault Tolerance– Performance
• Available to customers with Business and Enterprise-level support
• Now four checks available as free tier!
http://aws.amazon.com/premiumsupport/trustedadvisor/
“Over the last couple years, we’ve sent more than 2.6 million Trusted Advisor notifications that have saved customers over US$350 million dollars.”
Trusted Advisor: Cost Optimization Tips
Leverage The Right Storage Classes…
AWS Cloud
Amazon Glacier
Gateway Appliance/ AWS Storage Gateway
Amazon S3
Block File
On-premises Data Center
Archive Backup Disaster Recovery
Amazon EBS
• Amazon S3 Reduced Redundancy‒ 99.99% durability vs. 99.999999999%
• Amazon S3 Infrequent Access‒ For data accessed less than two times a
month
• Amazon Glacier‒ Same durability as S3‒ 3 to 5 hours restore time‒ Up to 65% savings‒ Great for archiving, long-term backups
and old dataAmazon EFS
(Preview)
…Alongside AWS Managed or ApplicationServices…
Elastic LoadBalancing
(ELB)
Amazon Relational Database Service
(RDS)
Amazon ElastiCache
Amazon DynamoDB
Amazon Simple Queue Service
(SQS)
Amazon Simple Email Service
(SES)
AmazonLambda
Amazon Elastic MapReduce
(EMR)
Amazon Simple Notification Service
(SNS)
Amazon Kinesis
Amazon Route 53
Amazon Redshift
To Offload Your Architecture…
+
Standard Setup
• 4 x Medium Instances$193
• AWS Data Transfer 1 TB$92
• Total = $285
Optimized• 1 x Medium Instance
$48• CloudFront Data 1 TB
$87• CloudFront Requests (10M)
$7.5• Total = $142.5
50%
6X
Cheaper
Faster
Intro to Amazon EC2 Dedicated InfrastructureComparing Dedicated Hosts to Standard EC2 Instances
Multi-tenant servers host instances for multiple customers’ workloads
AWS determines which hosts instances run on You pay per instance
Single-tenant servers host instances for one customer’s workloads
You can determine which hosts instances run on
You pay per host
Standard Amazon EC2 Instances Amazon EC2 Dedicated Hosts
EC2 Instance
Customer 1
Customer 3
Customer 5
Customer 2
Customer 4
Customer 6
Customer X
Amazon EC2Dedicated Hosts
Comparing Dedicated Hosts to Standard EC2 Instances
Dedicated Hosts give you license flexibility
Amazon EC2 Dedicated Instances
Dedicated Infrastructure payment options
Dedicated Hosts On-Demand Pricing
Dedicated Reserved Instances Pricing
Leveraging the power of the cloud compliantly
Intro to Amazon EC2 Dedicated Infrastructure
Dedicated Hosts give you license flexibility
When running Microsoft Workloads, for example:
Instance-host affinity allows you to comply with the 90 day rule
Per-core and per-socket visibility enables reporting at the physical level
Placement controls ensure that instances run on the server you want them to, helping you meet stringent compliance and regulatory requirements
AWS Config allows you to record when instances start, stop, or are terminated for license reporting and true-ups
Amazon EC2Dedicated Hosts
Comparing Dedicated Hosts to Standard EC2 Instances
Dedicated Hosts give you license flexibility
Amazon EC2 Dedicated Instances
Dedicated Infrastructure payment options
Dedicated Hosts On-Demand Pricing
Dedicated Reserved Instances Pricing
Leveraging the power of the cloud compliantly
1.Architect for Cost Efficiency
2. Optimize UsageCosts
3. Take Advantageof Benefitsover Time
How do customers lower their TCO with AWS?
1
Source: IDC Whitepaper, sponsored by Amazon, “Quantifying the
Business Value of Amazon Web Services” May 2015
“Average of 400 servers replaced per customer”
Replace up-front capital expense with lower “pay for what you use” variable
cost model
3
Periodic Price
Reductions
Economies of scale allow AWS to
continually lower costs
4
Save more money as you grow bigger
Tiered PricingVolume
Discounts
2
Pricing model choice to support variable &
stable workloads
On-DemandReserved
SpotDedicate
d
Analysts have shown AWS reduces costs over long term
Source: IDC, Quantifying the Business Value of Amazon Web Services (May, 2015)
…and that these benefits increase over time
Source: IDC Business Value of AWS Accelerates over time
According to IDC, this relationship between length of time using AWS and return is due to customers leveraging the more optimized environment to generate more applications along a learning curve.
$1 Investment in AWS
$8.40 in benefits
At 60 Months of using AWS
~8X$3.50 in benefits
$1 Investment in AWS
At 36 Months of using AWS
~3X
Comparing TCO is not easy(But We’re Going to Try)
≠
Elements of Infrastructure TCO
Diagram doesn’t include every cost item. E.g. software costs can include database, management, middle tier software costs. Facilities cost can include costs associated with upgrades, maintenance, building security, taxes etc. IT labor costs can include security admin and application admin costs.
Hardware – Server, Rack Chassis PDUs, ToR
Switches (+Maintenance)
Hardware – Storage Disks, SAN/FC Switches
Network Hardware – LAN Switches, Load Balancer
Bandwidth costs
Server Admin Virtualization Admin
1
2
3
4
Server Costs
Storage Costs
Network Costs
IT Labor Costs
Software - OS, Virtualization Licenses
(+Maintenance)
Storage Admin costs
Network Admin Costs
Facilities Cost
Space Power Cooling
Facilities Cost
Space Power Cooling
Facilities Cost
Space Power Cooling
AWS TCO Calculator: Example Cost Savingshttp://awstcocalculator.com
1.Architect for Cost Efficiency„Pay for what Youthink you need“
2. Optimize UsageCosts„Pay for what you use“
3. Take Advantageof Benefitsover Time„Pay for whatyou really need“
Summary: Cost Optimization with AWS
Rolf KerstenHead of EMEA Platform Business [email protected]
