This document discusses cloud cost optimization strategies and techniques. It begins with introducing the author and their background in cloud computing. Then, it outlines the key pillars of cost optimization including right-sizing elasticity, understanding storage classes and pricing models, measuring usage, and designing systems with cost in mind. Next, it describes the cost optimization process of identifying unnecessary resources, idling resources, and repetitive work. Tools for establishing cost visibility like the AWS billing dashboard and Cost Explorer are also highlighted. The document concludes by noting the latest trends in cloud cost optimization.

1. Cloud Cost Optimization

2. #whoami: yogesh sharma
• Cloud Architect @ Tata Consultancy
Services
• Overall 10+ years of experience, 5+ years
of experience in Cloud, DevOps
• AWS Community Builder
• 3x AWS Certifications
• Technical Speaker and Blogger
• Owner of https://multicloudwarrior.com/
https://www.linkedin.com/in/sharma-yogesh/

3. What to expect
• Cloud Cost Optimization- What, Why
• Pillars for Cost Optimization
• Cost Optimization Process
• Checklist
• Latest Trends

4. We all love Cloud and its Services…
AWS is for builders
You build it,
You run it,
You optimize it

5. But are we fully aware about Cloud Financials
Are we spending too much on unnecessary
stuff knowingly/unknowingly?

6. Pay for what you use
But how would you ensure that you pay
what you actually need?
Bill Formula:
Spend = Usage * Rate

7. Cloud Cost Optimization
Managing costs is a challenge for organizations using public cloud
services but also an opportunity to drive efficient consumption of IT.
Gartner’s Top Trends for Cloud:
• Cost optimization will drive
cloud adoption
• Insufficient cloud IaaS skills will
delay migrations
• Distributed cloud will support
expanded service availability

8. Pillars for Cost Optimization
Right-sizing Elasticity Pricing Models
Storage Classes Measure and Mechanisms Designing for Cost

9. Elasticity
• Scale up and down to meet
capacity requirements
based upon CPU, RAM,
network etc.
• Automatically turn
nonproduction off outside
of working hours
Think about:
•AWS Auto Scaling and EC2 Fleet
•AWS Instance Scheduler
•AWS CloudWatch
Auto-scaling
policies

10. Pricing Models
On- Demand
Pay-for-compute capacity
by the second with no
long-term commitments
Savings Plans & Reserved
Instances
Make a commitment and receive a
significant discount off compute
Spot Instances
Spare AWS EC2 Capacity at
saving up to 90%
off On-Demand prices
Spiky workloads to
Define needs
Committed &
steady-state usage
Fault-tolerant, flexible,
stateless workloads
If your bid > spot price → get an instance
If your bid < spot price → instance is terminated

11. Storage Classes
Amazon S3 Amazon Glacier
Infrequent Access
HOT WARM COLD
Provisioned IOPS
SSD (io1)
General Purpose
SSD (gp2)
Throughput Optimized
HDD (st1)
Cold HDD (io1)

13. Measure and Mechanisms

14. Designing for Cost
Consolidated Billing
Using AWS Organization
Go Serverless Unused Elastic IPs
Containerization
CloudFront
(Lower compute and caching)
Managed RDS
EC2 Spot

15. Cost Optimization Process
Biggest Strength- Architecture Flexibility
Main goal- Avoid unnecessary stuff
Unnecessary
Resources
Idling
Resources
Repetitive
Work

16. Tools that establish Cost Visibility

18. Measure: Monitor your workloads
Set up metrics to defines success and track progress
“What KPI makes sense for this workload?”
% Instances turned off daily
%instances right sized
%RI Utilization
Monitor AWS Resources Set Alarms Monitor Custom Metrics
View Graphs and Statistics Monitor & React to
Resource Changes

19. Measure- AWS Billing/Cost Dashboard
• Use AWS Billing and Cost
Management Dashboard
• Set up your monthly AWS
budget
• Dive deep with AWS Cost
Explorer
Also checkout-
https://calculator.s3.amazonaws.com/index.html
https://calculator.aws/
https://aws.amazon.com/economics/

20. Measure: Cost Explorer
Use Cost Explorer Personalized
Recommendations and decide to go with
Reserved Instances Category-
Standard, Convertible and Scheduled RIs

21. Checklist

22. Latest Trends- Launched in re:Invent 2020

23. Thank you!