How can I identify areas for cost optimization in my AWS environment?

AWS Cost Optimization

7 mins read

Keeping your AWS expenses low is becoming crucial as more businesses migrate to the cloud. AWS offers a variety of pricing models and tools to help you reduce your expenses and maximize your resources, but it can be overwhelming to know where to start.

In this article, we’ll look at some strategies for AWS cost optimization.

There are various ways to save your money on AWS. Also, it depends on the project details, impact and complexity. There are some ideas about where to start.

Consider the case when you have a large number of files that are infrequently viewed, such as backups or old media files that occasionally are read by your users. A service like AWS Glacier is not currently an effective solution because you still want to keep the files accessible online. However, you want to cut costs. This is a typical situation, and you can save quite a bit of money by using S3’s Standard Infrequent Access and One Zone Infrequent Access storage classes. If you use S3, they have a feature which will check should be used regular S3 or infrequent access.

Let’s say you have 10TB of infrequently-accessed files and each month you retrieve 1% (100GB) of data and serve 100K GET requests on those files.

The Cost of Access

The cost of Standard Infrequent Access and One Zone Infrequent Access.

Less commonly used data can be quickly accessed when necessary with S3 One Zone-IA. Unlike other S3 Storage Classes which store data in a minimum of three Availability Zones (AZs), S3 One Zone-IA stores data in a single AZ and costs 20% less than S3 Standard-IA).

Delete unused resources;
Make resources the way they should be before moving them into the cloud;
Enterprise and savings plan – more powerful things (discount in exchange for a commitment);
Scheduling – turn on and off resources based on schedule (AWS instance scheduler) for example DevEnv when a team is not working;
RIs – reserved instances that have a big discount (by 72%) if compare with “on demand”, plus if there is prepayment, more payment on advanced – more discount.

Furthermore, it’s essential to monitor how prices vary as the popularity of your product or service increases.

Set up a responsible person for cost management and give the team access to the amount that was spent on the services;
Start using the Cost Explorer tool on a monthly or quarterly basis. Try to concentrate on the top 3|5 expenses and let your team investigate them deeper;
Use Compute Optimizer and Amazon CloudWatch;
Set custom budgets that trigger alerts when cost or usage exceeds or are only forecasted to exceed a budgeted amount. Budgets can be set based on tags and accounts as well as resource types.

One of the keys to reducing cloud bills is to have visibility into services.

An AWS feature called CloudWatch is used for gathering and tracking metrics, keeping an eye on log files, issuing resource alarms, and automatically responding to changes in AWS resources. Example of usage: You can set up an alarm with a notification when an EC2 CPU utilization goes below 20% and take action after an investigation of why the instance is underutilized.

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AWS Architecture Areas

Examples of Areas Where to Focus when Working on Architecture:

Networking

From a cost perspective, it is preferable to produce as many instances as necessary within a single area. The same rule work for EC2 as well as for RDS instances. The most common use case: is to create a read replica for your Database.

Try to make data calculations inside AWS, to pay less for outbound traffic. 2D option – data transfer will be free, and only 50kb result will be charged.

S3 Bucket has Its Own Calculation

Using the cloud front above the S3 is cheaper than using S3 directly and Amazon S3 Transfer Acceleration can speed up content transfers to and from Amazon S3 by as much as 50-500% for long-distance transfer of larger objects.

NAT Gateway

A NAT Gateway is a Network Address Translation (NAT) service. You can use a NAT gateway so that instances in a private subnet can connect to services outside your VPC but external services cannot initiate a connection with those instances.

Each hour that your NAT gateway is operational and each gigabyte of data it handles after you provision it will incur fees.

VPC endpoints are virtual devices. They are horizontally scaled, redundant, and highly available Amazon VPC components that allow communication between instances in an Amazon VPC and services without imposing availability risks or bandwidth constraints on network traffic.

Re-architecting and Designing for Cost

In the event of an enormous increase in client demand, cloud providers must maintain some space capacity on hand. However, most of the time, this extra space is left unused.

When you buy a Spot Instance, you’re essentially borrowing excess capacity from your cloud provider for a certain period of time. “Borrowing” is the operative word here. If demand goes up and your cloud provider needs that extra capacity, they’ll take it back — often with less than a minute’s notice before your workloads disappear.

But that doesn’t mean you should avoid Spot Instances altogether — it just means you should use them strategically.

S3 is cheaper then EC2 for static website;
CloudFront is cheaper than S3 on the internet;
Autoscaling – add more servers only when you need it, decrease power when you don’t need it.
Serverless architecture cuts the costs by 70% to 90% as you do not have to pay for extra services you do not require.
Containerization can reduce cost, for example, if have one reserved and many containers on it.
Amazon GuardDuty is a threat detection service that continuously monitors your AWS accounts and workloads for malicious activity and delivers detailed security findings for visibility and remediation.

Here are some highlights from these results:

North Virginia is typically the cheapest region;
It costs 52% more to deploy this infrastructure in Sao Paulo compared to North Virginia;
Avoid Sao Paulo, unless you absolutely had to deploy in that region due to really bad latency or regulation;
Not all regions in Europe cost the same. Stockholm would cost 11% less compared to Paris.

Conclusion

Optimizing AWS costs is crucial for businesses looking to operate efficiently and effectively in the cloud. Here at ZenBit, we can provide expert guidance and support. We offer a range of services to help businesses identify cost savings opportunities, optimize infrastructure usage, and implement effective cost-management strategies.