The cloud is set to disrupt the IT market by nearly $1.8 trillion by 2025, as new technologies push businesses to shift workloads to the cloud. Public cloud services like AWS optimize workload consumption and manage costs, but initial bills can be daunting due to poor implementation and excess costs.
Cloudelligent’s FinOps team has identified three major AWS billing challenges:
- Choosing the Right AWS Pricing Model
- Uncovering Hidden AWS Costs
- Effective Spending Monitoring and Tool Usage
Let’s explore these challenges and the quick solutions our experts recommend.
1. Choosing the Right AWS Pricing Model
When using Amazon Web Services (AWS), you have several pricing models, each tailored to different workloads and usage patterns. Understanding these models can help you optimize costs and make informed decisions. Let’s dive into the details of each AWS pricing model.
Figure 1: AWS Pricing Models
Choosing the right AWS pricing model can be a game-changer, maximize your AWS cost takeout through our expert Cloud Cost Optimization solutions.
2. Uncovering Hidden AWS Costs
The biggest challenge with AWS bills is that customers are responsible for selecting and managing their resources, directly impacting costs. Often, what seems expensive is due to a lack of understanding of the bills and charges. The key to optimizing your AWS bills is to understand them. In this section, we’ve broken down all the costs to help you understand the details.
Getting familiar with the various terms may take time, but you’ll get there! The next step is learning to forecast your bill and prepare in advance. AWS billing might seem complex, but understanding the terms and timing will help avoid bill shock.
Decoding Hidden Costs
Hidden costs, such as egress charges, support fees, and other unexpected expenses, can significantly impact your AWS bill. By identifying these concealed costs, you can act to mitigate their effect on your expenses.
Egress Charges
Transferring data out of the cloud can lead to unexpected costs. Data egress occurs when data leaves a cloud provider’s network for an external location, such as moving data between different regions or availability zones, switching to another cloud provider, or bringing data back on-premises.
Data egress fees are often hidden and billed in arrears, catching many off guard. Large data extractions by applications, workloads, and users can quickly accumulate hefty bills. This is especially relevant for organizations with multiple global offices and cloud instances.
Here are some tips to keep in mind:
- Volume Discounts: Higher data volumes lower the per-gigabyte charge, but overall costs can still be high.
- Geographic Considerations: Transferring data within the same region or availability zone is cheaper than moving data across regions or continents.
- Provider Rates: Leading cloud providers like AWS typically charge between 5 and 20 cents per GB for data moved to your private data center or on-premises location.
Support Fees
If you’re using AWS support, be aware of the associated fees. AWS offers four support plans: Developer, Business, Enterprise On-Ramp, and Enterprise Support. The fees for these plans are calculated as a percentage of your total monthly AWS charges for all account IDs subscribed to those respective plans. Therefore, as your AWS usage increases, your support fees will also rise, regardless of whether you need more support services that month.
Exploring Additional Hidden AWS Fees
Here are some additional AWS fees that you need to watch out for!
Figure 2: Exploring Additional Hidden AWS Fees
3. Effective Spending Monitoring and Tool Usage
Tools like AWS Cost Explorer, billing alerts, and Cost Allocation Tags are invaluable for gaining insights and control over your AWS usage. These tools help you avoid unexpected charges and optimize resource utilization. Here’s how you can leverage these tools to manage your AWS costs more effectively and eliminate any unwanted surprises.
Cloudelligent’s team of experts can help you navigate your AWS cloud bill with ease and help you maximize savings, minimize effort, and slash costs by 15-50%. Book your Free Cost Optimization Review.
AWS Cost Explorer
AWS Cost Explorer is a powerful tool that helps you manage and understand your cloud costs. It offers detailed insights into your AWS usage and expenses, allowing you to visualize, analyze, and control your spending. By using Cost Explorer, you can make informed decisions and reduce unnecessary expenses. Although mastering this tool can be complex, investing time in learning its features and capabilities will maximize its benefits.
With Cost Explorer, you can:
- Break down your AWS bill by service, region, or usage type.
- Track daily, monthly, and forecasted spending to find patterns and savings.
- Analyze resource configurations to identify cost-effective options.
Setting Up Billing Alerts
Billing alerts are crucial for staying within your budget and avoiding surprise charges. By setting a monetary threshold for your AWS account, you’ll receive email notifications if your charges exceed this limit. This proactive approach helps you manage your expenses more effectively. Billing alerts offer a straightforward yet powerful way to monitor your spending, keeping you informed and alert to potential cost overruns.
AWS Cost Allocation Tags
Cost allocation tags are essential for managing and understanding your AWS costs. Tagging your AWS resources allows you to categorize and track expenses with precision. While AWS automatically applies some tags, creating user-defined tags provides even more control and clarity over your spending.
Benefits of Cost Allocation Tags:
- Identify which resources drive your costs.
- Track expenses for different projects or applications.
- Generate detailed and accurate spending reports.
Avoid the AWS Bill Shock With Cloudelligent
Cloudelligent offers a comprehensive suite of tools for optimizing cloud cost management. By leveraging CoreStack’s services, we provide automated billing reports that deliver detailed insights into cost expenditure, enabling businesses to identify areas for cost reduction and efficiency improvements. For alternative cost-saving strategies, Archera offers a flexible 30-day solution to Savings Plans and Reserved Instances, along with a 30-day Guaranteed option for enhanced financial control.
Cloudelligent’s Cost Optimization Assessment offers potential savings of 15-50% on cloud costs through a free evaluation. We offer a free 30-day trial of CoreStack’s SaaS cloud management platform, enabling potential customers to explore its full range of features before committing. Together, these tools provide a robust approach to managing and optimizing cloud costs effectively. Get started with a free Cost Optimization Assessment today.
