1.
How AWS Pricing Works
Jinesh Varia
jvaria@amazon.com
Technology Evangelist

2.
AWS Pricing Philosophy
Pay as you go
• No minimum commitments or long-term contracts required
• Capex -> Opex
• Turn off when you don’t need it
Pay less per unit when you use more
• Tiered Pricing and Volume Discounts
Pay even less when you reserve
• Reserved pricing
Pay even less as AWS grows
• Efficiencies, optimizations and economies of scale result in passing the
savings back to you in the form of lower pricing
Custom Pricing

3.
Did you know?
AWS Free Usage Tier Free Services Data Transfer
New Customers
Amazon EC2
(Linux & Windows)
Amazon ELB AWS Elastic Beanstalk No Charge for Inbound
Amazon S3 AWS CloudFormation Data Transfer
Amazon EBS AWS IAM
Auto Scaling No Charge for Data
For all customers Consolidated Billing Transfer Between
Services within a region
Amazon SQS/SNS
Amazon DynamoDB
Amazon SES
Amazon SWF
And more…

4.
19 price cuts in last 5 years
“It makes me look so good in front of my CFO.
When he [CFO] sees the savings in our AWS
monthly bill, he thinks that it is me who is working
hard on driving the costs down and increasing
efficiency of the company’s infrastructure. I get
all the credit for all the hard work you guys are
putting in.”.
Massive economies of scale and efficiency
improvements allow us to continually lower prices.

5.
Amazon S3 Amazon CloudFront
Storage Class Traffic Distribution
• Standard Storage vs. Reduced • Data transfer and request pricing
Redundancy Storage (RRS) vary across geographic regions
Storage • Pricing is based on the edge
• Number and size of objects stored in location where content is served
your Amazon S3 buckets Requests
Requests • The number and type of requests
• Number and type of requests (GET vs (HTTP or HTTPS) made
PUT/COPY) • Geographic region in which the
Data transfer requests are made.
• Amount of data transferred out of Data Transfer Out
the Amazon S3 region.
• Amount of data transferred out
of your Amazon CloudFront edge
locations.

6.
Demo: Let’s estimate how much it will
cost to deploy a Simple Static Website
Demo

7.
Amazon EC2 Pricing Fundamentals
Compute (Instances) Block Storage
• Clock hours of server time • Additional storage,
• Machine configuration backups, data transfer
(instance type) Load balancing
• Purchase type (On- • Data Processing
Demand, Reserved, Spot)
Detailed Monitoring
• Operating systems and
software packages Elastic IP addresses
Data Transfer
• Regional Data Transfer
• Data Transfer out

8.
Let’s estimate how much it will cost
to deploy a dynamic website
Demo

9.
www.MyWebSite.com
(dynamic data)
Amazon Route 53
media.MyWebSite.com
(DNS)
(static data)
Elastic Load
Balancer
Amazon
Auto Scaling group : Web Tier CloudFront
Amazon EC2
Auto Scaling group : App Tier
Amazon RDS Amazon S3
Amazon
Availability Zone #1 RDS
Availability Zone #2

10.
Different Purchase Options
For Steady For Time- For Regulatory
For Spiky
State insensitive and Compliant
Workloads
Workloads workloads Workloads

11.
Pay even less when you reserve
Reserved Instance
Savings over On-demand Instances (up to)
Offering Types
Light Utilization
42% 1-year 56% 3-year
Reserved Instances
Medium Utilization
49% 1 -year 66% 3-year
Reserved Instances
Heavy Utilization
54% 1-year 71% 3-year
Reserved Instances

12.
Reserved Instances Example
Six servers/instances:
• 2 small Linux for app and web servers
• 2 large Linux for database servers
Description Option 1 Option 2 Option 3 Option 4
App Servers 2 On-Demand 2 On-Demand 1 On-Demand 1 On-Demand
1 Reserved Medium 1 Reserved Light
Web Servers 2 On-Demand 2 On-Demand 1 On-Demand 1 On-Demand
1 Reserved Medium 1 Reserved Light
Database 2 On-Demand 2 Reserved 2 Reserved Medium 2 Reserved
Servers Medium Heavy

13.
Cost Comparison (On-Demand vs. Reserved)
Option 1 Option 2 Option 3 Option 4
Monthly Cost $746.64 $424.56 $344.04 $314.76
One-Time 1-year - $1820.00 $2275.00 $2405.00
Cost
3-year - $2800.00 $3500.00 $3700.00
Total Cost 1-year $8959.68 $6914.72 $6403.48 $6182.12
3-year $26879.04 $18084.16 $15885.44 $15031.36
Savings (over 1-year - 23% 29% 31%
Option 1)
3-year - 33% 41% 44%

14.
Pay less when you use more

15.
Amazon DynamoDB Pricing Fundamentals
Provisioned Throughput Indexed Storage
per table • Table, Items, attributes
• Number of reads/sec Data Transfer
• Number of writes/sec • Data Transfer out
• Item size
• Read Consistency
(eventual/strict)

16.
Let’s estimate how much it will cost
to store data in Amazon DynamoDB
Demo

17.
This is how your AWS monthly bill looks like

18.
Elasticity is one of the fundamental
properties of the cloud that drives many of its
economic benefits

19.
Elasticity + Auto Scaling
Infrastructure
Cost $
Large You just lost
Capital customers
Expenditure
Predicted
Demand
Traditional
Hardware
Actual
Demand
Cloud
Automated
Elasticity
time

20.
When you turn off your cloud resources,
you actually stop paying for them

21.
Continuous optimization in your
architecture results in
recurring savings
as early as your next month’s bill

22.
Optimize by time of the day
25% Savings

23.
www.MyWebSite.com
(dynamic data)
Amazon Route 53
media.MyWebSite.com
(DNS)
(static data)
Elastic Load
Balancer
Amazon
Auto Scaling group : Web Tier CloudFront
Amazon EC2
Auto Scaling group : App Tier
Amazon RDS Amazon S3
Amazon
Availability Zone #1 RDS
Availability Zone #2

24.
Optimize by seasonal cycles
50% Savings

25.
Optimize during the month
75% Savings

26.
#1
Pay as You Go, Pay less when you use more,
#2
Pay even less when you reserve
#3
Elasticity is the fundamental property of the cloud
#4
Get Started Today with AWS Free Usage Tier

27.
Thank you!
Jinesh Varia
jvaria@amazon.com Twitter:@jinman

28.
http://aws.amazon.com