Five Basic Principles of Cloud Cost Monitoring and Management

Posted on November 6, 2019 | by Ozzy Brightrose | Leave a Comment

There are all kinds of reasons why companies undertake cloud migrations, but it’s probably fair to say that many of them are likely to revolve around the potential to reduce costs. Cloud environments can indeed offer the potential for significant cost savings but in practice they are only going to do so if you manage them properly. In other words, if you’re prepared to get to grips with cloud cost monitoring and optimization.

Cloud Cost Monitoring and Management

Tools can be helpful, but only if you actually understand how to use them effectively

Amazon Web Services, Google Cloud and Microsoft Azure all have tools you can use to monitor and optimize your cloud spend. There is also a wide variety of third-party tools for the same purpose. These range from offerings which are intended to be “one tool to rule them all” to tools which are intended for one, very specific, aspect of cloud cost monitoring and optimization, such as the performance of your applications, the health of your database or the standard of your network data-flow.

If you’re a small SMB, using just one public cloud vendor, these are very likely to be more than you need. If, however, you’re a larger SMB, they could be very helpful even if you’re just using one public cloud vendor and especially if you’re using multiple public cloud vendors. Tools, however, are generally only as capable as the person using them, so if you want to make any cloud cost monitoring and optimization tool work for you, you’ll need to understand the five basic principles of cloud cost monitoring and optimization.

1. Your cloud strategy needs to manage your cloud infrastructure actively

When you do your initial cloud migration, you’ll have a clear map of your entire cloud infrastructure. You might even have taken your cloud migration as an opportunity to clean up your systems and make them more streamlined and efficient.

The problem, however, is that the cloud environment makes it just so easy to add a virtual machine here and some storage there and create a dependency somewhere else. To be fair, it also makes it easy to remove them, but humans don’t necessarily remember to tidy up everything after their work is done, especially not when they want to go home for the day (or weekend).

This means that your cloud strategy needs to include a process whereby you actively and regularly check your cloud infrastructure so you know what you actually have (or had and terminated) rather than what you think you have (or had and terminated).

2. You need to understand what you do to resource it effectively

Similarly, you need to understand what the people in your organization are doing so you can provide them with exactly the level of resource they need, no less and certainly no more. Remember that one of the major benefits of cloud computing is that it gives you the opportunity to finesse resources to an impressive level of detail.

Probably the most obvious example of this is the way you can adjust the speed of your storage to suit the application. It’s obvious that you’d use your fastest storage for the most business-critical applications and your slowest storage for tasks like data warehousing, but look out for opportunities to rein in the speed of all the tasks in between. Just turning down the storage speed a little bit may be a very minor inconvenience to users (in fact they may not even notice it), but it could save your organization a lot of money.

3. Monitoring cloud cost monitoring and optimization needs to be a team effort

As a bare minimum, there needs to be two people with the skills and knowledge to undertake cloud cost monitoring and optimization in an effective manner. That way, if one is off, for any reason, or leave the company, the other one can cover. Two, however, is cutting it fine and will probably only be feasible in the smallest of SMBs. Ideally you want a team of people sharing the work in an agreed manner (so as to avoid duplication/replication of responsibilities) and each team member should have their own cover.

4. Access control matters, a lot

Basically, you want to do everything you reasonably can to limit the number of people who can buy reserved instances and you absolutely must do everything you possibly can to limit the number of people who can authorize on-demand usage. In simple terms, you want to create a situation where every cost is owned by someone who is held accountable for it. Ideally, you want this accountability to be incorporated into their job description and performance objectives.

5. Use automation as much as possible

Automation is your safeguard against human forgetfulness. If you really don’t want to take the risk of automated tools closing down resources without human oversight, then have them send alerts and make sure humans act on them.

cloud cost reduction

Cloud Computing Cost Savings – The Benefits Explained

Posted on November 5, 2019 | by Ozzy Brightrose | Leave a Comment

Data centers are about capacity planning, cloud environments are about cost optimization. What this means in practice is that when you undertake a cloud migration, you need to start getting into the habit of analyzing your billing data in detail. The good news is that there are a variety of AWS cloud cost saving tools to help you do just that.

The obvious place to start your cloud cost management journey is with AWS’ own Cost Explorer. You may find it is actually all you need and even if it isn’t, it’s probably going to be a decent foundation and a solid reference point.

Understanding Cloud Computing Cost Savings

You need to enable Cost Explorer in your account

This is easy enough to do, just go to the AWS Management Console and open the Billing and Cost Management console. Then choose Cost Explorer and then Enable Cost Explorer. Once Cost Explorer is enabled it cannot be disabled, although it’s hard to see why you would want to disable it.

The basics of Cost Explorer

You can view your data online for free. If you want to access your data programmatically using the Cost Explorer API, then there is a small cost for each request. Currently this is $0.01.

The actual mechanics of using Cost Explorer are really simple. When you first go to use it, you will trigger a tutorial which takes you through the basics of how everything works. If you need to, you can run this again, at any time by going to the service bar, clicking “?” and then clicking “View Cost Explorer tutorial”. Overall, however, the interface is very intuitive so you may not even need the tutorial.

What you can do with Cost Explorer (and why you should do it)

Here is a very quick overview of what Cost Explorer can do for you and why it matters.

Rightsizing recommendations

If you’re just getting started in cloud computing then you might find it best to let Amazon guide you through managing your resources. This option seeks out your underused resources in every Region and linked account and presents them to you in an easy-to-understand way so that you can take action (if you choose) through the Amazon EC2 console.

This is not just an easy way to cut your billing. It’s also a pointer as to what aspects of your cloud strategy you may need to investigate and adjust.

Reserved Instances expiration alerts

RIs are usually valid for a certain period of time. This is typically anything between one and three years. This means that RI expiration alerts are probably only going to start being useful once you’re established in the cloud environment. Having said that, if you set them up straight after your cloud migration (i.e. while it’s still fresh in your mind), you’ll know that they’re there waiting for when you will need them.

The reason this is important is because Reserved Instances only have any value if you actually use them. You can overspend on your RIs in the same way as you can overspend on anything else and if you find that your RIs are repeatedly expiring unused (or only partially used) then there is clearly some kind of problem with your cloud cost management.

Extensive reporting options

The core of Cost Explorer is its extensive range of cost and usage reports. The cost reports are a handy way to keep track of your cloud spend, but the biggest value is in the usage reports, otherwise known as the Reserved Instance reports.

Making the most of Amazon Web Services largely boils down to maximizing your use of reserved instances (and spot instances when you can get them) and minimizing on-demand usage. AWS RI reports can tell you everything you need to know to make this happen.

The RI Utilization reports show how much of your RIs you actually used and how much you saved and/or overspent on your use of RIs. The RI Coverage reports show how many of your instance hours were covered by RIs versus on-demand instances and hence shows if you have under- or over-purchased RIs.

One of the nice features of Cost Explorer is that it enables you to set a coverage target, which is basically the percentage of your instance usage which you want to see covered by RIs. Cost Explore can then create charts of your actual usage versus your target usage, which are color-coded to show how well you are doing meeting your RI target.

For the sake of completeness, these charts are only as meaningful as your coverage target, so it’s important to put some thought into creating it and be prepared to adjust it as appropriate. For example, if you just do a “lift and shift” cloud migration, then you are probably going to need to set a fairly low coverage target to start with and then raise it as you find your feet in the cloud environment.

Cloud Computing Cost Savings – The Tips & Benefits

Posted on November 5, 2019 | by Ozzy Brightrose | Leave a Comment

In this incredibly fast-growing IT world, Cloud Computing appeared as a Next Level Approach to use innovative resources efficiently.

And, guess what? Most of the IT businesses have started (or already have) moving workloads to the cloud, for enjoying multiple benefits.

Turning business to cloud offers approximately one-third of cost reduction when compared to traditional working techniques.

Cloud services necessarily result in cloud computing cost savings. Migrating data to the cloud or moving the IT infrastructure to the cloud is undoubtedly a smart decision.

A Beginners Guide to Cloud Computing Cost Reduction

Cloud Computing is an interesting approach that allows users to expand and grow business while paying only for the used computing resources, and, that too, in an efficient manner.

By doing so, the operating costs are reduced to minimum values, and you can modify the business according to modern innovations.

Simply put, cloud computing maximizes business performance by offering enhanced resources and a flexible environment. There is no need for expensive outlays, in-house infrastructure, hardware upgrades, and many more features.

Organizations plan data migration to cloud for long-term cost savings. It is one of the most significant decisions businesses make to use innovative resources proficiently.

There comes a myriad of good reasons to move the business to the cloud. Some experts even denote it as doing more with less.

Cloud computing not only enhances business performance or saves money but also offers top-notch data security. That’s why most businesses now migrate to cloud, especially small organizations or individual-based work.

Cloud platforms, such as Amazon Web Services (AWS), Microsoft Azure, Google Cloud Platform, and more offer a variety of resources including Software as a Service (SaaS), Storage as a Service (SaaS), Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and more.

The demand for Cloud Computing is increasing on a worldwide scale. Now, most of the tycoon businesses also operate from the cloud.

How Cloud Computing Reduces Overall IT Costs?

IT companies spending a handsome amount on Infrastructure, Equipment, Software, Maintenance, & Support are highly favoring cloud computing.

Now, with cloud computing, there is no need for such additional sources, as cloud offers everything at a competitive price.

Cloud cuts or reduces substantial capital costs by eliminating extra spending on resources.

Let’s put together the factors that define cloud computing cost savings.

Software Update & Managing Expenses

Cloud is basically SaaS- Software as a Service. So, when operating on cloud, users need not worry about software updates and maintenance expenses at all.

Plus, you don’t pay any bills if there is zero usage of software and other applications. It also assists you save more by reducing the transparent upfront software prices. Bill charges are even trim down by avoiding the not-required software purchases.

Cloud Computing runs on cost models or subscription plans. And, these monthly plans include everything from the latest software updates to maintenance.

Reduced Hardware & Server Costs

With cloud computing, resources such as hardware, servers, storage capacity, and other infrastructure are no longer required.

When you move your business to cloud, all these expenses get covered in the cloud cost models or so-called monthly subscription plans.

Cloud providers named AWS, Azure, and Google Cloud Platform cover such expenses in the monthly bills.

Well, that’s how businesses enjoy flexibility, scalability, maximum storage capacity, and all at reduced costs.

All-time IT Support

When the talk is related to IT support and maintenance, the cloud is possibly the first thing IT businesses choose. These benefits are not offered by regular outsourced IT providers.

Moving data to cloud endows numerous benefits, and all-time IT support is preeminent of all services.

Online businesses require timely support for troubleshooting, maintenance, identifying updates, upgrades, and many more tasks.

And, cloud environment presents all without investing in in-house IT service providers.

Virtual Data Availability

Gone are the days when employees have the authorization to access data only inside the appropriate premises. But, with the introduction of the cloud, such things changed.

Now, with everything on the cloud, it is easy to access data and info from any place possible.

Data is stored securely on the cloud, and an authorized user can access it from any virtual device having an internet connection. Users can access the data outside business hours too.

This reduces the infrastructure costs by offering flexibility to the employs without hurting business performance.

Data Security is not an issue with the cloud. That’s because all the data is stored in specific locations with backup. Even hardware or software failure produces no harm to the business at all.

You never have to pay an extra amount for such issues, as these are covered in the monthly bills. All that you ask for!

Wrapping Up

All in all, moving business to the cloud comes with pretty good reasons.

From boosting business performance efficiently to remarkable cloud computing cost savings, this virtual platform is going places.

Cloud offers competitive advantages to organizations, regardless of business size. Users need not worry about infrastructure costs and maintenance bills anymore.

7 Key Tasks for AWS Cloud Cost Optimization

Posted on November 4, 2019 | by Ozzy Brightrose | Leave a Comment

AWS Cloud Cost Optimization

One of the big selling points of cloud computing is that it is very easy to scale up and down in line with changing business requirements. This is one area in which Amazon Web Services particularly excels. While this is good news in a lot of ways, it does mean that companies have to be really careful to implement effective cloud cost management. If they get this right, they can make significant cost savings. If, however, they get it wrong, those cost savings can evaporate and the cloud migration could go down as an expensive mistake.

With that in mind, here are seven key tasks for AWS cloud cost optimization.

1. Set up AMIs for your standard configurations

AMIs are Amazon Machine Images, or, in other words, templates for software configurations. You can use these to start and stop EC2 instances. This approach not only ensures that you actually remember to start everything required for a job. It ensures that you remember to shut it all down again after the job has completed.

Everything includes the likes of storage and network IP, both of which will continue to be billed for as long as they are active, regardless of whether they are being used. This can be a serious leak in your cloud cost management, but, fortunately, it should be an easy fix.

2. Remember to release your Elastic IPs

Remember that Elastic IPs are only free when your instance is actually running and even then you only get one free Elastic IP per instance. Basically Amazon wants you to use it or lose it, in other words, make it available for someone else to use. Take the hint and enjoy the cost savings.

3. Make it a priority to delete orphaned snapshots

Snapshot is the Amazon Web Services term for back-up. Snapshots only have meaning when an instance still exists. As with most things cloud, however, the onus is on you to remember to delete them when you end the instance and delete the volumes. Given that the snapshot is basically a copy of the original volume, remembering to delete it can save you as much as remembering to delete the original volumes.

For the record, if your cloud spend is higher than you anticipated and you’re trying to work out why, this is a good place to start your investigations as orphaned snapshots are often low-hanging fruit for people who want (or need) to make cost savings.

4. Look at your usage graphs

AWS provides you with metrics on CPU and memory usage for each and every one of your compute instances. It displays these in graphical form, which means it’s really easy to see when usage peaks and when it dips. Take a good look at both the highs and the lows and see what they mean in practice. For example, is a peak a genuinely busy time or is it a sign that a department is failing to use the cloud efficiently? Is a low genuinely low usage or is it a sign that someone has just left an instance “idling”, rather than turning it off?

5. Check you’re actually using the right instances/reservation types

This may seem like stating the obvious, but it can be surprisingly easy to miss. If you can achieve the same result with different instances/reservations types, then use the one which works out most economical. This will typically be the newest-generation system.

6. Check that you’re using the right storage configurations

Similar comments apply here. You don’t need to use a sledgehammer to crack a nut. In other words, save your fastest storage for your business-critical apps. Tasks such as data warehousing can run just fine on slower storage. In fact, if you look at your actual usage, you may well find opportunities for making cost savings without really impacting users by just switching to storage which is a bit slower.

7. Minimize interzone traffic

This one can take a bit of work, but the cost savings can make it worth the effort. The key point to remember is that Amazon Web Services works on a zonal basis and that interzone traffic is charged. You therefore want to minimize it as much as possible.

For example, let’s say you have an application running over two zones. Each zone has a load balancer and there are two application servers in each zone. If you have your load balancers spread the load between all four servers, then basically you are, at least potentially, just creating avoidable interzonal traffic, otherwise known as pure profit for Amazon Web Services. If, by contrast, you have each load balancer just work with the two servers within its own zone, then you eliminate this interzonal traffic and you can enjoy the cost savings.

Similarly if you have the application servers connected to two databases (one in each zone), then again, you’re just creating interzonal traffic for which you will be charged. If you just have the application servers point to the database in their own zone (i.e. either the master or the slave not both), then again, you can make cost savings.

Cloud cost optimization open source tools vs proprietary tools

Posted on November 4, 2019 | by Ozzy Brightrose | Leave a Comment

Cloud cost optimization open source tools vs proprietary tools

For many companies, especially SMBs, cloud computing is the way of the future. In many ways, cloud environments such as Amazon Web Services and Microsoft Azure, simplify a lot of the issues SMBs typically face. For example, they eliminate the need to manage budgets around occasional, large capital expenditures. They eliminate the need to buy and manage IT hardware and the software to go with it. They eliminate the need to recruit and retain in-demand IT staff.

This change requires a new way of thinking and, in particular, a new way of looking at cost management. One of the most obvious examples of this is the way cloud migrations alter the financial arguments regarding the pros and cons of open-source software versus proprietary software.

From purchasing to licensing to on-demand use

In the old days, companies (and private individuals) had to buy software outright. This often meant swallowing a substantial up-front expense. Then many software companies switched to a licensing model. In many ways, this was a win for both parties. Software companies received a steady revenue stream, SMBs switched hefty capital expenditure for more manageable monthly payments.

At the same time, however, software-licensing models, understandably, tended to be loaded in favor of companies which were able and willing to make longer-term commitments, such as committing to a year’s worth of licensing and perhaps even paying up-front. This meant that if your goal was minimizing up-front expenditure and maximizing flexibility, open-source software still had a clear edge.

Now, however, cloud computing makes it possible to use proprietary software on demand. There is, of course, (usually), still a charge for it, but, in purely financial terms, the gap between open-source software and proprietary software has been narrowed. The other differences between them, however, still remain and need to be factored into your selection process.

Choosing your cloud cost optimization tools

First of all, it makes sense to familiarize yourself with the cloud cost management tools offered by your cloud vendor(s). They are proprietary, but they’re bundled in with the cost of your public cloud service, so effectively they’re free to use. Amazon Web Services, Microsoft Azure and Google Cloud all have decent cloud cost management tools and if you’re a smaller SMB, they may be all you need for effective cloud cost optimization.

If you’re a larger SMB, however, then you’re probably going to want more than this, especially if you’re using more than one public cloud vendor. This then presents you with the choice of opting for open-source cloud cost optimization tools or for proprietary cloud cost optimization tools. Here are five points you need to know about how the two compare.

Open source has no upfront costs, but there’s no vendor support either

For the record, open-source software often has great community support, which is available for free. It is also quite common for private companies to offer paid consultancy services. You just don’t get vendor support the way you do with proprietary tools.

Open source is usually very reliable, but if it fails there’s no vendor support

Similar comments apply here. If you opt for open-source software which has an active user community, then you will usually find that the software is of a very high standard and that any issues are quickly fixed. You definitely have the “right to repair”, in other words to hire a private company to fix the issue for you. This, however, would be at your expense and if you make changes to the code, you will be expected to share them. What you don’t get is a vendor with an obligation to fix the problem as quickly as they reasonably can.

Open source gives you the option to develop tools as you wish

This one might only be of interest to the largest SMBs but for these businesses it could be very valuable indeed. If you opt for open-source software, then you can have it customized to suit your exact requirements (albeit at your expense and generally with a requirement to share the code you create). You can then slice and dice your usage and billing data in a way which meets your exact requirements and if these changes then you can update your cloud cost optimization tool any time you like. Proprietary software may allow for some level of customization, but it is highly unlikely to allow the same degree of flexibility.

Open source may not be as user-friendly

This is a bit subjective, however it’s definitely worth taking into consideration. It’s generally recommended to road-test any piece of software thoroughly before committing to it (even if it is free to use) and you should definitely take this advice very seriously when it comes to open-source software.

Open source can be taken over if the community loses interest

Sometimes an open-source community can lose interest in a product. Sometimes a commercial developer can lose interest in a product. In the former case, however, you can take over the software yourself if you wish.

Cloud Cost Models: An Overview of Online Cloud Pricing

Posted on November 1, 2019 | by Ozzy Brightrose | Leave a Comment

Cloud computing, as demonstrated in Google’s Oxford Dictionary refers to ‘the practice of using a network of remote servers hosted on the Internet to store, manage, and process data, rather than a local server or a personal computer.’

With a universally increasing demand for cloud computing, the online world is developing speedily. These days, most online businesses operate with cloud computing on the go.

In simple words, cloud computing allows users to process and manage computing resources as services to maximize business performance. There are cloud providers selling services, depending on cloud cost models. There is always a price war between various cloud service providers, thanks to the growing competition.

End users working with cloud computing technology enjoy multiple benefits to enhance business performance. A user can choose cloud services according to the business requirement. All the cloud cost models and services come with merits & demerits of own.

What are Cloud Cost Models?

The term defines it all! Cloud cost models are basically the pricing structure set by cloud service providers to present computing services.

A user can choose specific plan, which perfectly goes with the requirement, and pay for the same. These are billed per month, and the charges include the cost of all the resources used to maximize business performance.

Despite some service providers even charge for the ordered but not used resources too.

No matter whether you have used the resources, including in the plan or not, you need to pay the exact billed amount. While, there are some flexible plans that allow users to pay for the used resources only.

Cloud cost models include subscription plans as well as the pay-as-you-use plans for user benefit.

With the help of such cloud cost models, the user is benefited from multiple resources at reasonable prices. And, that is what all the cloud users actually want, excellent quality services at realistic monthly costs.

Cloud Cost Models: On What Factors does the Price Depend?

When it is about cloud services pricing, a myriad of factors ask for consideration. Most renowned service providers are in a war to offer better services at competitive prices.

Take example of Amazon Web Services (AWS), Microsoft Azure, and Google Cloud. These tycoons are in the cloud business offering somewhat the same services at different prices.

The service providers target to generate maximum profits while end-users wish for premium resources to accomplish better business performance.

Cloud cost models price depends on:

Initial Services Cost

The original cost of the resources and services are included in the monthly bill. These are basically the fixed initial rates of the resources.

It is the first investment on the way to buy or lease resources. Users can choose from a variety of resources at first, which include, software as a service (SaaS), Platform as a service (PaaS), storage as a service (SaaS), Infrastructure as a service (IaaS), and more.

Quality of the Service (QoS)

Cloud service providers ensure top quality and support when offering resources. It is truly the foremost factor to look for when opting for cloud computing services.

And, yes, the better quality services are expensive, as these are necessary for enhanced performance. Cloud service providers offer all-time support, scalability, top-notch protection, privacy, and more.

Contract Time

It is the period in which the users will use the cloud services. As the term defines, there is a contract between user and service provider for using the cloud resources.

Cloud services cost less when a user chooses to go with long-term plans.

Maintenance Costs

These are the maintenance charges which cloud service providers spend annually. The service providers use the amount for cloud maintenance, security, scalability, and other tasks.

Cloud Cost Models: An Overview

On cloud, there are several pricing models depending on the quality, lease time, initial costs, and more. The price is determined by the chosen subscription plan, resources used, and the provider’s service practices.

Fixed and Dynamic, these are the two chief categories of cloud pricing models. You can choose the plan (from these categories) that fits business requirement and avoid additional charges for the not-used resources.

Pay-as-you-Use

Under this pricing model, the users are charged according to the actual consumption. The more is the resource consumption, the higher will be the monthly bill. ‘

There is no need to pay any extra amount; consumers only pay for the used resources and quantity.

Amazon Web Services (AWS) present this pricing model. It is more efficient and results in less wastage.

Subscription Plans

It is a fixed cloud cost model. The monthly bill is calculated according to the fixed service offered in a plan. The bill remains the same for every month or the specific set period.

Spot Pricing Models

Represented by Amazon Web Services (AWS) is one of the best options accessible in today’s market.

AWS uses Amazon Spot Instances to let consumers bid for unused resources and storage. Amazon brought the spot-market model for EC2 services.

The price of this category depends on the demand for resources in the market. The price is determined after discovering the spot market only.

Wrapping Up

There you have it!

The cloud cost models, as reliable subscription plans, have made cloud computing simpler and affordable. With an increased need for cloud technology, these pricing models are helpful to an extent.

Globally, the adoption of such innovative technology proves that pricing standards are necessary to maintain the competition. And, cloud cost models do the same!

cloud cost monitoring

Author: Ozzy Brightrose