Kuala
Lumpur

Getting to Profitability
iCarAsia.com

AWS Cloud Kata for Start-Ups and Developers
About iCar Asia
!   Our startup is just over 1 year old
•  ASX listed w/market capitalization of ~AUD$180 million
•  200+ ...
iCar Asia on AWS
Consumer
Search

Seller
Portal

Core API

Portal API

Solr

CRM

Spec
DB

!  How do we run on AWS?
•  EC2...
How this helped us to build our
integrated portal faster…
!   Stabilize
!
!
!
!

 
 
 
 

Add capacity
Build a low latency...
Cumulative
annual spend.
Reserved
Instances vs. On
Demand pricing
AWS Cloud Kata for Start-Ups and Developers
Thank you !

AWS Cloud Kata for Start-Ups and Developers
Getting to Profitability
The Infamous Hockey Stick
Usage
Page Views
Revenue
Etc.

Time
The Infamous Hockey Stick
Usage
Page Views
Revenue
Etc.

Costs

Time
You want only 3 things
Revenue to go Up
Unit Costs to go Down
Margin to go Up
The Infamous Hockey Stick
Usage
Page Views
Revenue
Etc.
Costs

Time
How does AWS help here?
Economies of Scale
Pricing Models
Cost Aware Architecting
What does this look like in
the real world?
An example
!
!
!
!
!
!

 
 
 
 
 
 

Enterprise)so+ware)provider)in)APAC)
Focused)on)SaaS)for)storage,)security,)collabora...
“Based on a True Story”
Margin
Growth

54%
reduction in
unit costs

-20%
-10%
price drop RI purchase
in S3

-22%
Migration...
Idea

MVP

Scale

Profitability

01

02

03

04
Scale

Getting to Profitability

Profitability

03

04

Pricing Models
Cost Aware Architecting
Total Cost of Ownership
Cost Optimization using different purchase models
Free Tier

On-Demand

Reserved

Spot

Get Started on AWS
with free usage...
aws.amazon.com/activate
Reserved Instance Pricing
Make a low, one-time payment and receive a
significant discount on the hourly charge
For committ...
Reserved Instance Pricing
U"liza"on)

RI)op"on)

Savings)over)On4Demand)

<10%)

OnODemand)

10%)O)40%)

Light)U=liza=on)R...
•  Most traffic happens in the afternoons and evenings, so they reduce the number of
instances at night by 40%.
•  At peak...
Save more money by using Spot Instances
Spot)market)for)underO
u=lized)capacity)
)
Requested)Bid)Price)and)
Pay)as)you)go)...
Use Cases for Spot Pricing
Use)Case)
Batch)Processing)

Types)of)Applica"ons)
Generic)background)processing)(scale)out)com...
Optimizing Video Transcoding Workloads
for a FREEMIUM model
Premium Offering

Free Offering
Optimize for reducing cost
Acc...
Scale

Getting to Profitability

Profitability

03

04

Pricing Models
Cost Aware Architecting
Total Cost of Ownership
“Give me 4 fault tolerant algorithms and I can pick
the best one almost with my eyes closed.
If you then ask me which one ...
Cost optimization through ‘Cost Aware Architecting’
Reduce Cost of…
Compute

…by leveraging:
1. S3 & CloudFront for Cachin...
Cost Aware Architecting to Reduce costs of EC2
1. S3 & CloudFront for Caching & Offloading
•  Reduce your compute demand a...
Cost Aware Architecting to Reduce costs of EC2
1. S3 & CloudFront for Caching & Offloading
Cost Aware Architecting to Reduce costs of EC2
1. S3 & CloudFront for Caching & Offloading
Cost Aware Architecting to Reduce costs of EC2
1. S3 & CloudFront for Caching & Offloading
Cost Aware Architecting to Reduce costs of EC2
1. S3 & CloudFront for Caching & Offloading
Static content
Dynamic calls
Cost Aware Architecting to Reduce costs of EC2
2. Auto-Scaling done Right with Real Time reaction response
•  Elastic Load...
Buuuk for Singapore Press Holding (SPH)
Cost Aware Architecting to Reduce costs of EC2
2. Auto-Scaling done Right with Real Time reaction response

Buuuk

Straits...
Cost Aware Architecting to Reduce costs of EC2
2. Auto-Scaling done Right with Real Time reaction response
Cost Aware Architecting to Reduce costs of EC2
2. Auto-Scaling done Right with Real Time reaction response
Cost Aware Architecting to Reduce costs of EC2
2. Auto-Scaling done Right with Real Time reaction response
Cost Aware Architecting to Reduce costs of EC2
2. Auto-Scaling done Right with Real Time reaction response
Cost Aware Architecting to Reduce costs of S3
3. Storing derivative objects in S3 ‘Reduced Redundancy’
•  Original vs. der...
Cost Aware Architecting to Reduce costs of DB
4. Read Replicas and/or ElastiCache (‘Database Smarts’)
• 
• 
• 
• 

Scale o...
90% of calls
Cost Aware Architecting to Reduce costs of Test/Dev
5. Rapid proto-typing & Lean Dev/Test
•  Inexpensive idea validation
•...
Scale

Getting to Profitability

Profitability

03

04

Pricing Models
Cost Aware Architecting
Total Cost of Ownership
When)calcula"ng)TCO…)
#1)Start)by)understanding)your)use)cases)&)usage)paUerns)
Tradi=onal)HW)/)Hos=ng)
WASTE

On and Off

Fast Growth

Variable peaks

Predictable peaks

CUSTOMER DISSATISFACTION
AWS)=)Elas=c)Capacity)

On and Off

Fast Growth

Variable peaks

Predictable peaks
When)calcula"ng)TCO…)
#1)Start)by)understanding)your)use)cases)&)usage)paUerns)
#2)Apples)to)Apples)–)Take)all)the)fixed)co...
When)calcula"ng)TCO…)
#1)Start)by)understanding)your)use)cases)&)usage)paUerns)
#2)Apples)to)Apples)–)Take)all)the)fixed)co...
Tradi"onal)Hos"ng)vs)AWS)
# of
(virtual)
servers

60)

50)

40)

30)

20)

10)

0)

Hos=ng)
Hosting

Offload
to S3

Cachin...
When)calcula"ng)TCO…)
#1)Start)by)understanding)your)use)cases)&)usage)paUerns)
#2)Apples)to)Apples)–)Take)all)the)fixed)co...
“Based on a True Story”
Margin
Growth

54%
reduction in
unit costs

-20%
-10%
price drop RI purchase
in S3

-22%
Migration...
When)calcula"ng)TCO…)
#1)Start)by)understanding)your)use)cases)&)usage)paUerns)
#2)Apples)to)Apples)–)Take)all)the)fixed)co...
Did you know?
Free Usage Tier

Free Services

Data Transfer

AWS Elastic Beanstalk
AWS CloudFormation
AWS IAM
Auto Scaling...
Trusted Advisor
A premium security spec at non-premium prices
• 

VPC

• 

Direct connect

and VPC

• 

Dedicated instances

Network ACL

...
DEMO)

Gegng)to)Profitability)

Off-loading of static content to CloudFront to reduce required
server capacity
So what does this mean in terms of costs?
Standard Architecture
Month
Medium EC2 instances 4
$ 485
AWS Data Transfer Out 1...
Thank You
aws.amazon.com/start4ups)
aws.amazon.com/ac"vate)
AWS Cloud Kata | Kuala Lumpur - Getting to Profitability on AWS
AWS Cloud Kata | Kuala Lumpur - Getting to Profitability on AWS
AWS Cloud Kata | Kuala Lumpur - Getting to Profitability on AWS
AWS Cloud Kata | Kuala Lumpur - Getting to Profitability on AWS
AWS Cloud Kata | Kuala Lumpur - Getting to Profitability on AWS
AWS Cloud Kata | Kuala Lumpur - Getting to Profitability on AWS
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Transcript of "AWS Cloud Kata | Kuala Lumpur - Getting to Profitability on AWS"

  1. 1. Kuala Lumpur Getting to Profitability iCarAsia.com AWS Cloud Kata for Start-Ups and Developers
  2. 2. About iCar Asia !   Our startup is just over 1 year old •  ASX listed w/market capitalization of ~AUD$180 million •  200+ employees, across 3 countries •  400,000+ cars, 3.2M UVs across all sites in September !   What do we do? We help people buy and sell cars. AWS Cloud Kata for Start-Ups and Developers
  3. 3. iCar Asia on AWS Consumer Search Seller Portal Core API Portal API Solr CRM Spec DB !  How do we run on AWS? •  EC2, S3, Glacier, CloudFront, Elastic Cache, Route 53, and VPC. •  Ansible, BitBucket, New Relic, Monyog... •  The obligatory architecture diagram! Listings AWS Cloud Kata for Start-Ups and Developers
  4. 4. How this helped us to build our integrated portal faster… !   Stabilize ! ! ! !         Add capacity Build a low latency, shoot-first-and-ask-questions-later culture Single place, unified technology, common building blocks Getting to profitability for startups: •  Cash is king – Manage your costs •  Use the building blocks at hand •  Leverage the AWS SAs and the people in this room… AWS Cloud Kata for Start-Ups and Developers
  5. 5. Cumulative annual spend. Reserved Instances vs. On Demand pricing AWS Cloud Kata for Start-Ups and Developers
  6. 6. Thank you ! AWS Cloud Kata for Start-Ups and Developers
  7. 7. Getting to Profitability
  8. 8. The Infamous Hockey Stick Usage Page Views Revenue Etc. Time
  9. 9. The Infamous Hockey Stick Usage Page Views Revenue Etc. Costs Time
  10. 10. You want only 3 things
  11. 11. Revenue to go Up Unit Costs to go Down Margin to go Up
  12. 12. The Infamous Hockey Stick Usage Page Views Revenue Etc. Costs Time
  13. 13. How does AWS help here?
  14. 14. Economies of Scale Pricing Models Cost Aware Architecting
  15. 15. What does this look like in the real world?
  16. 16. An example ! ! ! ! ! !             Enterprise)so+ware)provider)in)APAC) Focused)on)SaaS)for)storage,)security,)collabora=on,)etc.) Backed)by)leading)VC’s)in)the)region) Strong)growth)–)winning)customers)globally) Focused)on)profitability)&)reducing)unit)costs) Worked)closely)with)the)AWS)team)to)op=mize)its)architecture)
  17. 17. “Based on a True Story” Margin Growth 54% reduction in unit costs -20% -10% price drop RI purchase in S3 -22% Migration Cassandra to Dynamo -18% Price drop in S3 of 25%
  18. 18. Idea MVP Scale Profitability 01 02 03 04
  19. 19. Scale Getting to Profitability Profitability 03 04 Pricing Models Cost Aware Architecting Total Cost of Ownership
  20. 20. Cost Optimization using different purchase models Free Tier On-Demand Reserved Spot Get Started on AWS with free usage & no commitment Pay for compute capacity by the hour with no long-term commitments Make a low, one-time payment and receive a significant discount on the hourly charge Bid for unused capacity, charged at a Spot Price which fluctuates based on supply and demand For POCs and getting started For spiky workloads, or to define needs For committed utilization For time-insensitive or transient workloads
  21. 21. aws.amazon.com/activate
  22. 22. Reserved Instance Pricing Make a low, one-time payment and receive a significant discount on the hourly charge For committed utilization 3 Versions • Light Utilization RI • Medium Utilization RI • High Utilization RI 2 Terms • 1-year • 3-year
  23. 23. Reserved Instance Pricing U"liza"on) RI)op"on) Savings)over)On4Demand) <10%) OnODemand) 10%)O)40%) Light)U=liza=on)RI) Up)to)56%) 40%)O)75%) Medium)U=liza=on)RI) Up)to)66%) >75%) Heavy)U=liza=on)RI) Up)to)71%)
  24. 24. •  Most traffic happens in the afternoons and evenings, so they reduce the number of instances at night by 40%. •  At peak traffic $52 an hour is spent on EC2 and at night, during off peak, the spend is as little as $15 an hour. Saving per hour = 71%
  25. 25. Save more money by using Spot Instances Spot)market)for)underO u=lized)capacity) ) Requested)Bid)Price)and) Pay)as)you)go) Spot)Price)<)OnODemand)Price))) Up)to)85%)savings)over)On)Demand)pricing)
  26. 26. Use Cases for Spot Pricing Use)Case) Batch)Processing) Types)of)Applica"ons) Generic)background)processing)(scale)out)compu=ng)) Hadoop) Hadoop/MapReduce)processing)type)jobs)(e.g.)Search,)Big)Data,)etc.)) ) Scien"fic)Compu"ng) Scien=fic)trials/simula=ons/analysis)in)chemistry,)physics,)and)biology) Video)and)Image)Processing/ Rendering) Tes"ng) Transform)videos)into)specific)formats) Web/Data)Crawling) Financial) HPC) Analyzing)data)and)processing)it) Hedgefund)analy=cs,)energy)trading,)etc) U=lize)HPC)servers)to)do))embarrassingly)parallel)jobs) Cheap)Compute) Backend)servers)for)Facebook)games) Provide)tes=ng)of)so+ware,)web)sites,)etc)
  27. 27. Optimizing Video Transcoding Workloads for a FREEMIUM model Premium Offering Free Offering Optimize for reducing cost Acceptable Delay Limits Optimized for Faster response No Delays ) Implementation –  –  –  –  Leverage spot pricing Maximum Bid Price < On-demand Rate Use on-demand Instances, if delay Get strongly reduced price for your workload Implementation –  Invest in Reserved Instances –  Use on-demand for Elasticity Get Instant Capacity for higher price
  28. 28. Scale Getting to Profitability Profitability 03 04 Pricing Models Cost Aware Architecting Total Cost of Ownership
  29. 29. “Give me 4 fault tolerant algorithms and I can pick the best one almost with my eyes closed. If you then ask me which one is best for the business, in terms of dollar costs, I would be clueless...” Werner Vogels, CTO, Amazon
  30. 30. Cost optimization through ‘Cost Aware Architecting’ Reduce Cost of… Compute …by leveraging: 1. S3 & CloudFront for Caching & Offloading 2. Auto-Scaling done Right Storage 3. Storing derivative objects in S3 ‘Reduced Redundancy’ Database 4. Read Replicas and/or ElastiCache Test & Dev 5. Rapid proto-typing & Lean Dev/Test
  31. 31. Cost Aware Architecting to Reduce costs of EC2 1. S3 & CloudFront for Caching & Offloading •  Reduce your compute demand and costs •  Improve end-user experience •  Increase reliability and durability
  32. 32. Cost Aware Architecting to Reduce costs of EC2 1. S3 & CloudFront for Caching & Offloading
  33. 33. Cost Aware Architecting to Reduce costs of EC2 1. S3 & CloudFront for Caching & Offloading
  34. 34. Cost Aware Architecting to Reduce costs of EC2 1. S3 & CloudFront for Caching & Offloading
  35. 35. Cost Aware Architecting to Reduce costs of EC2 1. S3 & CloudFront for Caching & Offloading
  36. 36. Static content Dynamic calls
  37. 37. Cost Aware Architecting to Reduce costs of EC2 2. Auto-Scaling done Right with Real Time reaction response •  Elastic Load Balancing and (event-driven) Auto Scaling •  Notification of pending news flash (with audible alarm) •  On-demand ramp up of capacity (6 mins.) •  Subscriber alert push delivered •  Mass response traffic handled (followed by ramp down)
  38. 38. Buuuk for Singapore Press Holding (SPH)
  39. 39. Cost Aware Architecting to Reduce costs of EC2 2. Auto-Scaling done Right with Real Time reaction response Buuuk Straits Times
  40. 40. Cost Aware Architecting to Reduce costs of EC2 2. Auto-Scaling done Right with Real Time reaction response
  41. 41. Cost Aware Architecting to Reduce costs of EC2 2. Auto-Scaling done Right with Real Time reaction response
  42. 42. Cost Aware Architecting to Reduce costs of EC2 2. Auto-Scaling done Right with Real Time reaction response
  43. 43. Cost Aware Architecting to Reduce costs of EC2 2. Auto-Scaling done Right with Real Time reaction response
  44. 44. Cost Aware Architecting to Reduce costs of S3 3. Storing derivative objects in S3 ‘Reduced Redundancy’ •  Original vs. derived assets : 33% savings •  Single reference and consistency •  Control, accurate logs and tracking Reduced Redundancy Storage ‘RRS’
  45. 45. Cost Aware Architecting to Reduce costs of DB 4. Read Replicas and/or ElastiCache (‘Database Smarts’) •  •  •  •  Scale out and share work Optimal performance, minimize load Enhance reliability, ensure data safety Cost reduction
  46. 46. 90% of calls
  47. 47. Cost Aware Architecting to Reduce costs of Test/Dev 5. Rapid proto-typing & Lean Dev/Test •  Inexpensive idea validation •  Seamless switch over and versioning •  Rapid dev / test agility
  48. 48. Scale Getting to Profitability Profitability 03 04 Pricing Models Cost Aware Architecting Total Cost of Ownership
  49. 49. When)calcula"ng)TCO…) #1)Start)by)understanding)your)use)cases)&)usage)paUerns)
  50. 50. Tradi=onal)HW)/)Hos=ng) WASTE On and Off Fast Growth Variable peaks Predictable peaks CUSTOMER DISSATISFACTION
  51. 51. AWS)=)Elas=c)Capacity) On and Off Fast Growth Variable peaks Predictable peaks
  52. 52. When)calcula"ng)TCO…) #1)Start)by)understanding)your)use)cases)&)usage)paUerns) #2)Apples)to)Apples)–)Take)all)the)fixed)costs)into)considera"on)
  53. 53. When)calcula"ng)TCO…) #1)Start)by)understanding)your)use)cases)&)usage)paUerns) #2)Apples)to)Apples)–)Take)all)the)fixed)costs)into)considera"on) #3)Leverage)‘Cost)Aware)Architec"ng’)to)reduce)resources)
  54. 54. Tradi"onal)Hos"ng)vs)AWS) # of (virtual) servers 60) 50) 40) 30) 20) 10) 0) Hos=ng) Hosting Offload to S3 Caching with CF AutoScaling Etc.
  55. 55. When)calcula"ng)TCO…) #1)Start)by)understanding)your)use)cases)&)usage)paUerns) #2)Apples)to)Apples)–)Take)all)the)fixed)costs)into)considera"on) #3)Leverage)‘Cost)Aware)Architec"ng’)to)reduce)resources) #4)Include)pricing)models)(RI,)Spot))and)economies)of)scale)
  56. 56. “Based on a True Story” Margin Growth 54% reduction in unit costs -20% -10% price drop RI purchase in S3 -22% Migration Cassandra to Dynamo -18% Price drop in S3 of 25%
  57. 57. When)calcula"ng)TCO…) #1)Start)by)understanding)your)use)cases)&)usage)paUerns) #2)Apples)to)Apples)–)Take)all)the)fixed)costs)into)considera"on) #3)Leverage)‘Cost)Aware)Architec"ng’)to)reduce)resources) #4)Include)pricing)models)(RI,)Spot))and)economies)of)scale) #5)Take)a)look)at)what’s)included:)Intangible)Cost)Savings)!)
  58. 58. Did you know? Free Usage Tier Free Services Data Transfer AWS Elastic Beanstalk AWS CloudFormation AWS IAM Auto Scaling Consolidated Billing No Charge for New Customers Amazon EC2 Amazon RDS Amazon ELB Amazon S3 Amazon EBS For All Customers Amazon SQS/SNS Amazon DynamoDB Amazon SES Amazon SWF And more… Inbound Data Transfer Data Transfer between Instances within an Availability Zone
  59. 59. Trusted Advisor
  60. 60. A premium security spec at non-premium prices •  VPC •  Direct connect and VPC •  Dedicated instances Network ACL •  Identity & Access •  Multi-Factor Authentication Management •  CloudHSM S3 Encryption •  RDS Oracle transparent •  •  Security groups for EC2 encryption
  61. 61. DEMO) Gegng)to)Profitability) Off-loading of static content to CloudFront to reduce required server capacity
  62. 62. So what does this mean in terms of costs? Standard Architecture Month Medium EC2 instances 4 $ 485 AWS Data Transfer Out 1Tb $ 194 TOTAL $ 679 Optimized Architecture Month Medium EC2 instances 1 $ 121 CloudFront Data Transfer Out 1Tb $ 168 CloudFront Requests $1.89 TOTAL $ 291 57% lower cost – 6 x faster
  63. 63. Thank You aws.amazon.com/start4ups) aws.amazon.com/ac"vate)

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