1. Improve your TCO and Optimise your
Cloud Spend
Peter “Dr Pete” Stanski
Principal Solution Architect
<stanski@amazon.com>

2. Agenda
What would it cost to run
on AWS?
How can I reduce my
AWS Spend?
Total Cost of Ownership Cost Optimization
SATechTipstoReduce$

3. Lower Costs with AWS
1
Replace up-front
capital expense with
low variable cost
2
42 Price
Reductions
Economies of scale
allow AWS to continually
lower costs
3
Pricing model choice
to support variable &
stable workloads
4
Save more money as
you grow bigger
On-Demand
Reserved
Spot
Tiered Pricing
Volume Discounts
Custom Pricing
Source: IDC Whitepaper, sponsored by Amazon,
“The Business Value of Amazon Web Services
Accelerates Over Time.” Dec 2013

4. AWS Pricing Philosophy
More AWS
Usage
More
Infrastructure
Economies
of Scale
Lower
Infrastructure
Costs
Reduced
Prices
More
Customers Ecosystem
Global Footprint
New Features
New Services
Infrastructure
Innovation
We pass the savings along to our
customers in the form of low
prices and continuous reductions
42

5. Lower Costs than on-premises
On-Premises
Traditional
Data Center
On-Premises
Virtualized
Data Center
CAPEX
OPEX
OPEX
AWS
CAPEX
OPEX*
Cost savings from running
internal IT more efficiently
AWS Scale
• New data centers built each year
• Volume purchasing, highly automated,
supply chain optimization
Utilization fundamentally higher in
AWS cloud
• Aggregating non-correlated workloads,
scale, spot market
Amazon specific hardware
designs
• OEM acquisition of custom servers & net
gear
• Direct purchasing of disk, memory, & CPU
• AWS controlled hypervisor & net protocol
layers
Diagram is not to scale
*For AWS, OPEX costs includes Reserved Instances one-time low, upfront payment, if Reserved Instances are used.
Cost savings from moving
to a public cloud provider

6. AWS TCO benefits increase over time…
$3.50 in benefits
$1 Investment in AWS $1 Investment in AWS
$8.40 in benefits
At 36 Months of using AWS… At 60 Months of using AWS…
~3X ~8X
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.

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

8. Typical cost drivers for on-premises deployments,
including overhead costs
Network
Costs
Storage
Costs
Server
Costs
Hardware – Server, Rack
Chassis PDUs, ToR
Switches
(+Maintenance)
Software - OS,
Virtualization Licenses
(+Maintenance)
Overhead Cost
Space Power Cooling
Hardware – Storage
Disks, SAN/FC Switches
Overhead Cost
Storage Admin costs
Network Hardware – LAN
Switches, Load Balancer
Bandwidth costs
Network Admin costs
Overhead Cost
IT Labor
Costs
Server Admin
Virtualization Admin
1
2
3
4
Space Power Cooling
Space Power Cooling
illustrative
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.

9. AWS offers services that include overhead costs in the
price
Hardware
Vendor
Offering
✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔ ✔
✔
Server
Network
Hardware
Software
OS +
VMs
DC/Co-lo
Floor
Space
Powering
Cooling
Software
Defined
Networking
Personnel
Admins
HW
Maint.
Storage
Redundancy
Resource
Mgmt. /SW
Automation
× × × × ××× ×

10. In Your TCO Analysis
Power/Cooling (compute, storage, shared network)
Data Center Administration (procurement, design, build, operate,
network, security personnel)
Rent/Real Estate (building deprecation, taxes)
Software (OS, Virtualization Licensing & Maintenance)
RAW vs. USABLE storage capacity
Storage Redundancy (RAID penalty, OS penalty)
Storage Backup costs (Tape, backup software)
Bandwidth, Network Gear & Redundancy (Routers, VPN, WAN..)
DON’T
FORGET
THINK
BENEFITS
Procurement Time, Resource sitting on self
Cost of lost customers
Less down time, increased productivity

11. Agenda
What would it cost to run
on AWS?
How can I reduce my
AWS Spend?
Total Cost of Ownership Cost Optimization

12. 1. Choose the right Instance types
Start
Choose an instance
that best meets your
basic requirements
Start with memory & then
choose closest virtual
cores
Look for peak IOPS
storage requirements
Tune
Change instance size up
or down based upon
monitoring
Use CloudWatch &
Trusted Advisor to assess
Roll-Out
Run multiple instances
in multiple Availability
Zones

13. 1, 1.7, $0.060
1, 3.75, $0.113
2, 3.75, $0.145
2, 7.5, $0.225
2, 17.1, $0.410
4, 7, $0.300
4, 15, $0.450
4, 34.2, $0.820
8, 15, $0.600
8, 30, $0.900
8, 68.4, $1.640
4, 30.5, $0.853
8, 61, 1.705
16, 30, $1.200
32, 60, $2.400
32, 244, $3.500
16, 122, $3.410
16, 117, $4.600
32, 244, $6.820
0
50
100
150
200
250
300
0 5 10 15 20 25 30
Choosing EC2 Instances
On Demand Prices shown (N.Virginia region), only latest generation instances (M3,C3) shown
where applicable, GPU and Micro instances not shown above
Memory-Optimized Instances
Compute-Optimized Instances
General Purpose Instances
Storage-Optimized Instances
vCPU
RAM

14. Automatic resizing of compute clusters
based on demand
Trigger autoscaling policy
Feature
Details
Control
Define
minimum
and
maximum
instance
pool
sizes
and
when
scaling
and
cool
down
occurs.
Integrated
to
Amazon
CloudWatch
Use
metrics
gathered
by
CloudWatch
to
drive
scaling.
Instance
types
Run
Auto
Scaling
for
On-­‐Demand
and
Spot
Instances.
CompaEble
with
VPC.
AWS autoscaling create-autoscaling-group
— Auto Scaling-group-name MyGroup
— Launch-configuration-name MyConfig
— Min size 4
— Max size 200
— Availability Zone(s) ap-southeast-2a & 2b
2. Use Auto Scaling
Amazon
CloudWatch

15. Utilization and Auto-Scaling: Granularity
more small instances vs. less large instances

16. 3. Turn Off un-used Instances
• Dev./test/training instances
• Use simple instance start/stop, or
• Tear down/build up altogether
• Instances are disposable

17. 0
2
4
6
8
10
12
14
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
On Demand
Light Utilization RI
Medium Utilization RI
Heavy utilization RI
/Spot Instances
4. Use Reserved Instances
Reserved Instances enable you to reserve capacity for one or three years by paying a low,
one-time fee for the capacity reservation and receiving a significant discount on the hourly
charge for your instances
Amazon EC2
Amazon RDS
Amazon DynamoDB
Amazon Redshift
Amazon ElastiCache
AWS Services offering Reservations

18. 5. Use Spot Instances
• Pricing
• Up to 92% discount
• Elastic
• Capacity not otherwise
available
• Tradeoff
• Potential for interruption
Picking the right Spot Bid Price - Tolerance for interruptions, % likelihood of
termination

19. 6. Leverage 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%
• Up to 20% savings
• Great for everything that is easy to
reproduce
• Amazon Glacier
• Same durability as S3
• 3 to 5 hours restore time
• Up to 67% savings
• Great for archiving, long-term
backups and old data

20. 7. Offload your Architecture
+
Standard Setup
• 4 x Medium Instances
$485
• AWS Data Transfer 1 TB
$194
• Total = $679
Optimized
• 1 x Medium Instance
$121
• CloudFront Data 1 TB
$168
• CloudFront Requests
$1.89
• Total = $291
57%
6X
Cheaper
Faster

21. 8. Leverage Application Services
Elastic Load
Balancing
Amazon Relational
Database Service
(RDS)
Amazon Simple
Queue Service
(SQS)
Amazon Simple
Email Service
(SES)
Amazon Elastic
MapReduce
Amazon
ElastiCache
Amazon Simple
Notification Service
(SNS)

22. 9. Consolidated Billing
• Receive a single bill for all charges incurred across all linked accounts
• Share RI discounts
• Combine tiering benefits
• View & manage linked accounts
• Add additional accounts

23. 10. Leverage AWS Tools
AWS Trusted Advisor AWS EC2 Usage Reports

24. AWS Cost Explorer
Monthly Spend by service
AWS Monthly Spend

25. TCO Calculator
aws.amazon.com/tco-calculator/

26. Dr Pete’s Black Belt Tip #1
Auto-scaling with Spot Instances Design Pattern
RI Instance
Elastic Load
Balancer
Auto scaling Group (Bid $)
Virtual Private Cloud
Auto scaling Group (Max:1 Min: 1)
Spot Instance Spot Instance

27. Dr Pete’s Black Belt Tip #2
The floating EBS Volume Pattern
Auto scaling Group (Bid $)
Spot Instance Spot Instance
Data Volume
(Tag: Spot1)
Data Volume
(Tag: Spot2)
Auto scaling Group (Bid $)
Spot Instance Spot Instance
Data Volume
(Tag: Spot1)
Data Volume
(Tag: Spot2)
UserData: On boot Attach available EBS volume starting with “Spot*”
Data Volume
(Tag: SpotX)

28. ….AWS Support

29. AWS Support - 24 7 365
= Current Support Engineering Teams

30. More than simple ‘Break – Fix’ Support
q Access to Highly Skilled engineers from All industries
• Telco | Public Sector | Banking | AV | ISP | …
q Traditional Reactive and Trouble Shooting Support
q Proactive Support & Design Assistance
• Help you get started with AWS
• Design Support: Best Practices, Cost Optimization
• Assistance with Security & Best Practices
• Migration assistance: Transition from legacy system to the Cloud
• Configuration help for a growing list of 3rd Party Software
• Support your promotions and Events, Go Live!

31. Access to Support Tools
YES
Customer Service 24/7/365
YES
YES
YES
YES
Support forums
YES
YES
YES
YES
Documentation, guides
YES
YES
YES
AUTO
HEALTH CHECKS
Access to Technical support
E
P/C/E
P/C/E/TAM
-
Named contacts
1
5
Unlimited
-
Response time
12 hours
1 hour
15 minutes
-
Architecture Guidance
Building
blocks
Guidance
App /
Architecture
-
Trusted Advisor
-
YES
YES

32. Access to Support Tools: Trusted Advisor
q Cost Optimization
q Security
q Fault Tolerance
q Performance

33. Why Support?
Traditional-to-Cloud
Migrations
Security, Cost Optimization
& Design Guidance
Engineer Assistance
with ANY service

34. … AWS Training & Certification

35. AWS Training and Certification - Overview
AWS Training and Certification is designed to help individuals delivering cloud-
based solutions to gain proficiency with AWS services and solutions.
AWS Instructor Led Training includes courseware, hands on labs and live
classroom environment. Candidates learn to design, develop, and operate
available, efficient, and secure applications on the AWS cloud delivered directly
by AWS knowledge experts.
Visit http://aws-training-apac.com/classes.html for a list of courses,
locations and dates.

36. Learning Paths

37. Benefits of AWS Certifications
AWS certifications certify the technical skills and knowledge associated with best
practices for building secure and reliable cloud-based applications using AWS
technology.
Earning AWS Certification enables you to
• Demonstrate that you have skills, knowledge, and expertise to design, deploy,
and manage projects applications on the AWS platform
• Gain recognition and visibility for your proven skills and proficiency
• Foster credibility with your employer and peers

38. AWS
Certification
Roadmap

39. AWS Certification

40. Summary
• TCO
• Not always apples to apples comparison
• Make reasonable assumptions and leverage benchmarks
• Know the on-premises hidden costs
• Cost Optimization
• Create cost-aware architectures and leverage AWS Best Practices
• Re-evaluate and revisit your architecture often
• Leverage Managed Services, CloudWatch
• Stay up to date – RI modifications, Trusted Advisor

41. What’s New to the Sydney Region
• Amazon Workspaces – fully managed desktop computing service
• EBS Encryption – EBS volume & snapshot encryption support
• S3 to Glacier for Versioned objects - Versioned Objects Lifecycle
Rules support
• AWS CloudTrail - AWS API call logging for governance &
compliance
• EC2 - Amazon EC2 G2 instances now available

42. Presenter
stanski@amazon.com
Thank
you
for
your
=me
today