The AWS EC2 calculator is right at the top of the AWS Simple Monthly Calculator, even above S3. This is probably a good indicator of the popularity of the service. The more you use a service, the more it will contribute to your cloud costs and so the more it pays to understand it. With that in mind, here is a quick guide to the AWS EC2 calculator.

The key factors in the AWS EC2 calculator

The key factors in the AWS EC2 calculator are the region, EC2 instances, EC2 dedicated hosts, EBS Volumes and Elastic Graphics. Other factors include Additional T2/T3 Unlimited vCPU Hours per month, Elastic IP and Data Transfer. Let’s look at the key factors in practice.

The region

These days a lot of companies will choose their region with legal/compliance issues at the top of their list of priorities and after that, it’s highly likely their next concern will be latency (or the lack thereof). In the unlikely event that all things are equal, however, remember that your choice of region can have a huge influence on the cost of any service. This is particularly obvious when it comes to high-volume services such as AWS EC2.

EC2 dedicated hosts

An EC2 dedicated host is basically a cloud server which is dedicated to your sole use. EC2 dedicated hosts can be a great solution for companies which would like to tap into the cost savings of the public cloud but want or need to keep data in a completely private environment.

One of the nice features of AWS EC2 dedicated hosts is that you can essentially automate administrative tasks via AWS. Basically, you specify your licensing rules and attach them to the AMI. Then you specify your dedicated host management preferences. 

From that point on, in principle, you can treat it as “set and forget” although as always, just because you can, it doesn’t mean that you should. Basically, it can be very dangerous (and/or expensive) to forget about anything in IT and so you should make a point of double-checking everything now and again to make sure it’s still an accurate reflection of your situation.

Amazon EBS Volumes

If you’re going to be storing data which needs to be updated regularly, then Amazon EBS Volumes are a good investment. They are particularly to be recommended if you need to hold data for apps which are used by “frontline staff” such as your customer service team. Not to put too fine a point on the matter, it can be an inconvenience if your back-end staff have to wait a bit, but you may lose business if you make your paying customers wait any longer than they believe is reasonable.

Amazon Elastic Graphics

Amazon Elastic Graphics basically gives your graphics a boost. Whether or not it’s relevant to you obviously depends on the extent, if any, to which you use graphics in your applications.

The issue of data transfers

The reason data transfers are listed as one of the “extra” factors, is because they don’t really relate directly to your use of EC2. They relate to your management of your cloud infrastructure as a whole. In particular, they reflect your ability to design apps which send data along the most economical paths. 

For practical purposes, this basically means that you want data to stay in its own availability zone (sub-region) as much as possible and if that is not possible do your level best to keep it within its own region. AWS charges the highest prices for data transfers between AWS regions and between AWS and the internet so you want to avoid these as much as possible.

For the sake of completeness, there is a little nuance here in some applications such as Amazon CloudFront, which sends users to the data center with the lowest latency at that time, but these exceptions can be ignored for now as they do not have any influence on AWS EC2 costs.

To commit or not to commit?

The aforementioned factors are all, essentially, “technical” factors, but there is one final issue which can greatly influence the cost of the AWS EC2 service and that is the pricing model or models you use. The popularity of EC2 means that AWS offers “Savings Plans” for it. Pretty much like their name suggests, Savings Plans offer AWS users discounts on EC2 (and other services) if they commit to a certain level of usage. 

Using Savings Plans can achieve discounts of up to 72% (under current rates) so if you anticipate using the service a lot, you should probably at least investigate them, especially since they do offer some degree of flexibility. Savings Plans can be used in combination with Reserved Instances and Spot Instances so you have even more opportunities for reducing costs.