Intended for the owners of the business side of the equation, this session is about reducing the complexity of managing costs for AWS deployments, ranging from few instances to fleets of hundreds and thousands of instances, so they run efficiently. Attendees will learn about optimization basics, common roadblocks that prevent customers from cost optimizing, tools they can use to efficiently remove those roadblocks, and techniques to monitor their rate of cost optimization when dealing with AWS deployments ranging from few instances to hundreds and thousands of instances. The session will include multiple case studies that will demonstrate how customers implement optimization techniques to reduce their costs.

1. From TCO to Optimization at Scale
Rotem Yossef, Business Development Manager, AWS
Vittaly Tavor, Co-Founder & VP Product, Cloudyn

2. 2
In the Beginning . . .
There was TCO

3. 3
What is TCO exactly and why does it matter to
customers and prospects?
Definition: total cost of ownership (acquisition and operating costs)
for running an infrastructure environment end-to-end on-premises vs. AWS.
Typical Usage of TCO analyses:
1)Comparing the costs of running an infrastructure environment or specific
workload/application on premises or in a co-location facility versus on AWS
2)Paralleling an existing AWS workload with an on premises or co-location setup

4. 4
Comparing TCO is not easy
(But We’re Going to Try)
≠

5. 5
IT Labor Costs
TCO the way IT orgs typically see it
Network Costs
Storage Costs
Server Costs Hardware – Server, (+Maintenance)
Software - OS, Virtualization Licenses
(+Maintenance)
Hardware – Storage Disks
Network Hardware – LAN Switches, Load Balancer
Bandwidth costs
Server Admin Virtualization Admin4
1
2
3
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.
illustrative

6. 6
Real Life = Acquisition costs + operations costs
illustrative
Hardware – Server, Rack
Chassis PDUs, ToR
Switches (+Maintenance)
Software - OS,
Virtualization Licenses
(+Maintenance)
Facilities Cost
Hardware – Storage
Disks, SAN/FC Switches
Software - Backup
Network Hardware – LAN
Switches, Load Balancer
Bandwidth costs
Software – Network
Monitoring
Server Admin, Virtualization Admin, Storage Admin, Network Admin, Support Team
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.
Space Power Cooling
Project planning, Advisors, Legal, Contractors, Managed Services,
Training, Cost of capital
Business Value:
Cost of delays
Risk premium
Competitive abilities
Governance
Etc.
IT Labor Costs
Network Costs
Storage Costs
Server Costs
4
1
2
3
Extras5
Facilities Cost
Space Power Cooling
Facilities Cost
Space Power Cooling

7. 7
When Performing a TCO analysis
• Build the TCO comparison collaboratively with the customer in
multiple iterations, take the “No surprises” approach
• Make sure you have the right stakeholders in the room to
discuss TCO (Finance, Procurement, IT support, Engineering)
• Avoid Comparing a duplicate of customer’s on-premise
environment – problematic apples-to-apples comparisons of
machines
• Assess the Business Value of AWS advantages such as agility,
flexibility & opportunity costs

8. 8
Resources to get you started
AWS TCO Calculator
https://awstcocalculator.com
AWS Economics Center
http://aws.amazon.com/economics/
Case Studies and Research
http://aws.amazon.com/solutions/case-studies

9. 9
So you’re feeling pretty good.

10. 10
Until your CFO shows up with the bill.

11. 11
Cost optimization is…
going from…
to…
pay for what you use
pay for what you need

12. 12
The Five Pillars of Cost Optimization
Right-Sizing Your
Instances
Pick the Right
Pricing Model
Increase
Elasticity
Measuring &
Monitoring
Match usage to
storage class

13. 13
Pillar 1: Right-Sizing
Right-sizing
• Selecting the cheapest instance available
while meeting performance requirements
• Looking at CPU, RAM, storage, and network
utilization to identify potential instances that
can be downsized
• Leveraging Amazon CloudWatch metrics and
setting up custom RAM metrics
Rule of thumb: Right size, then reserve.
(But if you’re in a pinch, reserve first.)

14. 14
Pillar 2: Increase Elasticity
Turn off nonproduction instances
• Look for dev/test, nonproduction instances that
are running always-on and turn them off.
• Lambda + CloudWatch = Automated Scheduling*
Autoscale production
• Use Auto Scaling to scale up and down based on
demand and usage (for example, spikes).
* https://aws.amazon.com/premiumsupport/knowledge-center/start-stop-lambda-cloudwatch/

15. 15
Pillar 3:
Leveraging the Right
Pricing Model
Reserved Instances
Spot Instances
On-Demand

16. 16
Reserved Instances
Step 1: RI Coverage
• Cover always-on resources with standard or
convertible RIs
Step 2: Increase RI Utilization
• Known architectures: Leverage Standard RI
flexibility to increase utilization.
• Growing or changing architectures: Leverage
Convertible RIs across families, sizes, and OS.
• Regional Benefit: Consolidated billing,
reservation not critical

17. 17
Consider Convertible RIs where flexibility is required
With a Convertible Reserved Instance, you can modify
your existing reservation across:
Instance families
Instance sizes
Operating Systems
Tenancy

18. 18
Options
• Spot Fleet to maintain instance
availability
• Spot Block durations (1-6 hours)
for workloads that must run
continuously
Commitment level
• None
* Compared to On Demand price based on specific EC2 instance type, region, and Availability Zone
Consider Spot for Elastic Workloads

19. 19
Strike a Balance
Finding balance between pricing options
Reserved
Instances
On Demand Spot

20. 20
Pillar 4:
Leveraging the Right
Storage Class

21. 21
Object Storage Classes on Amazon S3
Active data Archive dataInfrequently accessed data
Standard
Hot
Standard - Infrequent Access
Warm
Amazon Glacier
Cold

22. 24
Pillar 5: Measure & Monitor

23. 25
Automation.
1. Identify always on instances.
2. Identify instances to downsize.
3. Identify warm / cold storage.
4. Recommend RIs to purchase.
5. Dashboard our status.
6. Report on savings.

24. 26
Tools for Measuring &
Monitoring

25. 27
Option 1: DIY
Build your own custom dashboard

26. 28
Customers can set up their own dashboards and tools
Metric Tracking
Savings
Spend & Metrics
by Account
EC2 Usage by
Purchase Option

27. 29
Option 2: AWS Tools
Trusted Advisor

28. 30
AWS Trusted Advisor
Helping customers automate best practices (checks) across
cost optimization, security, fault tolerance, and performance
improvement
Red (action recommended)
Orange (investigation recommended)
Green (no problem detected)

29. 31
Option 3: Use a Partner

30. 32
And Partners have been successful helping
Customers monitor & manage cost

31. 33
CLOUD
BUSINESS
MANAGEMENT
From TCO to Optimization at Scale
AWS Pop-up Loft, Tel Aviv
April 3 2017

32. 34
CLOUDYN
MONITORS AND
OPTIMIZES
MULTI-CLOUDS
Enabling enterprises to fully
realize their cloud potential

33. 35
INFRASTRUCTURE
COSTS
Cloud prices of the same instance
type hour go down
On-prem costs for the same unit do
not
m3.medium – last 7 months
• On-prem cost behavior is complex,
but costs capacity are fairy stable
• Cloud costs are constantly droping:
• Price reductions
• Better pricing models
• More powerful families

34. 36
CLOUDYN SOLUTION
Grow your cloud with confidence.
Maximize cloud efficiencies.
Gain highly granular, real-
time visibility into
consumption, cost and
performance of your
multi-platform, hybrid
clouds
Continuously optimize and
streamline cloud
consumption and spend, for
highly efficient cloud growth
Empower enterprise-wide
cloud accountability,
through accurate and
reliable cost allocation
and chargeback
36

35. 37
VISIBILITY- FINANCIAL
AND OPERATIONAL
Full cost and usage visibility and
customization, via a single pane of
glass

36. 38
FEDERATED RBAC
ACCESS
Ability to build your company structure
and control the access at each level

37. 39
COST ALLOCATION
Implement a cost allocation model for the
purpose of custom show-back & charge-
back

38. 40
SIZING OPTIMIZATION
A clear guideline on how to right-size
resources for efficient cloud spend

39. 41
COST OPTIMIZATION
Choose the right pricing
models for the best ROI

40. 42
PROOFPOINT
Environment and Requirements
The Challenge
 In 2015, AWS was the largest unmanaged line item
in the budget
 Growing 2x per year organically, 3x per year with
acquisitions
The Search: Solution Bake-off
Requirements
 Enterprise: Consolidated accounts, SSO, RBAC
 Constituents: Finance, Operations, Engineering
 Usability: Ease of adoption, reporting, start simple
Customer Case
Study
42

41. 43
PROOFPOINT
Conclusion and Status
Customer Case
Study
Cloudyn
deployed
43

42. 44
Rotem Yossef
rotem@amazon.com
Vittaly Tavor
vittaly@cloudyn.com
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