cost optimization at scale

© 2016, Amazon Web Services, Inc. or its Affiliates. All rights reserved.

Mario ThomasSenior Consultant EMEA

AWS Professional Services

7 July 2016

Cost Optimisation at ScaleReducing the cost of using AWS


What We’ll Cover Today

• A quick overview of TCO• Does “at scale” apply to you?• Applying “architecting for cost” principles to your TCO

analysis and your AWS account(s)• Customer case study• Recap


What is TCO?

Definition: Comparative total cost of ownership analysis (acquisition and operating costs) for running an infrastructure environment end-to-endon-premises vs. on AWS.

Used for:

1) Comparing the costs of running an entire infrastructure environment or specific workload on-premises or in a co-location facility vs. on AWS

2) Budgeting and building the business case for moving to AWS


AWS Includes Everything In It’s Price

Hardware in a Data Center


Cost is Rarely the Only Reason to Choose AWS

Pay-as-you Go Model

Lower Overall Costs

StopGuessing Capacity

Agility / Speed / Innovation

Avoid Undifferentiated

Heavy LiftingGo Global in

Minutes

✔ ✔ ✔ ✔ ✔ ✔On-

Premise/ Co-Location

X X X X X X


So how do we do it?

≠


TCO = acquisition costs + operations costs

Hardware – Server, Rack Chassis PDUs, ToR

Switches (+Maintenance)

Software - OS, Virtualization Licenses

(+Maintenance)

Facilities Cost

Hardware – Storage Disks, SAN/FC Switches Storage Admin costs

Network Hardware – LAN Switches, Load Balancer

Bandwidth costsNetwork Admin costs

Server Admin / Virtualization Admin4

Diagram doesn’t include every cost item. For example, software costs can include database, management, and middle-tier software costs. Facilities cost can include costs associated with upgrades, maintenance, building security, taxes, etc. IT laborcosts can include security admin and application admin costs.

Space Power Cooling

Facilities Cost

Space Power Cooling

Facilities Cost

Space Power Cooling

Server Costs

Storage Costs

Network Costs

IT Labor Costs

1

2

3


The TCO Window

$

1 2 3 4 50

TCO

Migration Cost

Cost Optimising / BAU

Current / Do Nothing

AWS Environment

Payback Period

Time (Months)

Cost


Cost Optimisation

$ $

Paying for whatyou use

Paying for whatyou need


The four pillars of cost optimisation

Right sizing Reserved Instances

Increase elasticity

Measure, monitor, and

improve


Cost Optimisation

Simple Stimulating Stretching

Consolidated BillingPermissionsTaggingIdle Resources

Design for Elasticity

Instance Right SizingStoragePurchasing Options

OS LicencingOffloading Architecture

Higher Level Services


Consolidated Billing

• Receive a single bill for all charges incurred across all linked accounts‒ Share RI discounts‒ Combine tiering benefits

• View & manage linked accounts• Add additional accounts


Permissions

How are you controlling the provisioning of

resources?

Control who canprovision resources


Tagging

• Use tagging to identify resources• Use tags to audit resources• Turn off untagged resources


Idle Resources

• Dev/Test (Non-Prod) instances• Use simple instance start/stop, or• Tear down/build up altogether• Instances are disposable


Instance Right Sizing

Right sizing• Selecting the cheapest instance available

while meeting performance requirements• Looking at CPU, RAM, storage, and network

utilization to identify potential instances that can be downsized

• Leveraging Amazon CloudWatch metrics and setting up custom RAM metrics

Rule of thumb: Right size, then reserve.(But if you’re in a pinch, reserve first).


Use Amazon CloudWatch to collect and track metrics

CloudWatch

Match resources to workload


Amazon CloudWatch monitoring

Basic• 7 metrics for Amazon EC2

including:• CPU utilization• Data transfer• Disk usage and more

• 5-minute frequency• Metrics for Amazon EBS,

Amazon DynamoDB, Amazon RDS, etc.

Detailed• 1-minute frequency• Aggregation by instance type and

AMI


Instance families: Example

Instance vCPU Mem(GiB)

Monthly price(3-yr AURI )

Ideal use case

c4.2xlarge 8 15 $125.44 Best price-compute performance

m4.2xlarge 8 32 $137.25 Balanced

r3.2xlarge 8 61 $179.25 Lowest cost per GiB RAM

r3.xlarge 4 30.5 $89.61 Lowest cost per GiB RAM


t2.medium

4 GiB RAM Baseline performance: 40%Bursts beyond this based on CPU creditsLess than $18 per monthDetails: http://amzn.to/1sl2bKaWeb servers, dev, small databases

t2


t2 vs m3.medium or c4.large

Instance vCPU Mem(GiB)

Monthly price(3-yr AURI )

Ideal use case

m3.medium 1 3.75 $19.08 Always available, balanced

c4.large 2 3.75 $31.36 Always available, compute

t2.medium 2 4 $16.86 Bursty workloads


Savings potential

If t2 works for you• 11%: Switch from m3.medium to t2.medium• 46%: Switch from c3.large to t2.medium

Instance optimization• 9%: Switch to c4 for compute-intensive apps

(m4.2xl -> c4.2xl)• 35%: Switch to r3 for memory-intensive apps

(m4.2xl -> r3.xlarge)


Storage

AWS Cloud

Amazon Glacier

Gateway Appliance/ AWS Storage Gateway

Amazon S3

Block File

On-premises Data Center

Archive Backup Disaster Recovery

Amazon EBS

• Amazon S3 Standard Infrequent Access‒ Lower cost of storage

• Amazon S3 Reduced Redundancy‒ 99.99% durability vs. 99.999999999%‒ Up to 20% savings‒ Great for files that are easy to reproduce

• Amazon Glacier‒ Same durability as S3‒ 3 to 5 hours restore time‒ Up to 89% savings‒ Great for archiving, long-term backups and

old data


Instance Purchasing Options

On-Demand

Pay for compute capacity by the hour

with no long-term commitments

For spiky workloads, or to define needs

Reserved

Make a low, one-time payment and receive a significant discount on the hourly charge

For committed utilization

Spot

Bid for unused capacity, charged at a

Spot Price which fluctuates based on supply and demand

For time-insensitive or transient workloads


Reserved Instances

Commitment Level1 Year3 Year

AWS Services Offering RIsAmazon EC2 Amazon RDSAmazon DynamoDBAmazon RedshiftAmazon ElastiCache

* Dependent on specific AWS service, size/type, and region


Reserved Instances

Step 1: RI Coverage• Cover always on resources

Step 2: RI Utilization• Leverage RI flexibility to increase utilization• Merge and split RIs as needed

Rule of thumb: Target 70-80% always on coverage and 95% RI utilization rate.


• Be Fault Tolerant• Workloads should be Stateless• Loosely Coupled workloads preferred • If possible, deploy to Multiple AZs • Instant Flexibility is king• Take advantage of the 2 minutes warning • There is always Spot capacity available ¢

Save up to 90% compared to On-Demand¢

What could your team do with a 10,000 core data center that costs $100 per hour, with one click?

Spot Instances


Spot InstancesPricing• Up to 90% discount

Elastic• Minimum Commitment

• Commit to 1 hour• Tradeoff

• Potential for interruption

Picking the right Spot Bid Price - Tolerance for interruptions, % likelihood of termination


0

2

4

6

8

10

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

/Spot

Mixed Use Instances

Reserved Instances enable you to reserve capacity for one or three years by paying a low, one-time fee for the capacity reservation and receiving a significant discount on the hourly charge for your instances

AWS Services Offering RIs • Amazon EC2 • Amazon RDS• Amazon DynamoDB• Amazon Redshift• Amazon ElastiCache

On DemandSpotRI


OS Licensing

• Utilise Amazon Linux• Supported by Amazon• No licence fees• Regularly updated• Savings of up to 30% over other options*


Offload Your Architecture

Standard Setup• 4 x Medium Instances

$485• AWS Data Transfer 1 TB

$194• Total = $679


Offload Your Architecture

+

Standard Setup• 4 x Medium Instances

$485• AWS Data Transfer 1 TB

$194• Total = $679

Optimized• 1 x Medium Instance

$121• CloudFront Data 1 TB

$168• CloudFront Requests

$1.89• Total = $291

57%

6X

Cheaper

Faster



Turn off non-production instances• Look for dev/test, non-prod instances that are

running always-on and turn off

Autoscale production• Use Auto Scaling to scale up and down based

on demand and usage (e.g., spikes)

Rule of thumb: Shoot for 20-30% of EC2 instances running on demand to be able to handle elasticity needs.


Use Auto Scaling or queue-based approaches to add resources when needed, and turn them off when not

Amazon SQS Queue

Auto Scaling


Automatic resizing of compute clusters based on demand

Trigger autoscaling policy

Feature DetailsControl Define minimum and maximum instance pool

sizes and when scaling and cool down occurs.

Integrated to Amazon

CloudWatch

Use metrics gathered by CloudWatch to drive scaling.

Instance types Run Auto Scaling for On-Demand and Spot Instances. Compatible with VPC.

AWS autoscaling create-autoscaling-group— Auto Scaling-group-name MyGroup— Launch-configuration-name MyConfig— Min size 4— Max size 200— Availability Zones us-west-2c

Use Auto Scaling

Amazon CloudWatch


Utilization and Auto-Scaling: GranularityMore small instances vs. less large instances

29 Large @ $0.32/hr= $9.28

59 Small @ $0.08/hr= $4.72



AWSLambda

Elastic Load Balancing

Amazon ECR Amazon CloudFront

Amazon EFS Amazon Glacier

AmazonS3

AmazonDynamoDB

Amazon ElastiCache

AmazonRDS

Amazon Redshift

Amazon VPC

AmazonRoute 53

AWS KMS

AWS WAF Amazon Elasticsearch Service

Amazon EMR

Amazon Kinesis

Amazon Machine Learning

AWS IoT AmazonWorkSpaces



Amazon RDS Multi-AZ

High availability with a mouse click

Set up primary and standby instancesSet up identical volumesCreate synchronous replicationCreate and manage DNS entriesDetect instance failure conditionsDetect network failure conditionsDetect storage failure conditions…......Decide when to fail overRe-establish primary secondary connections

Do-it-yourself MySQL replication

Potentially ~100+ manual steps


Reviewing & Reporting


Detailed billing reports and

cost insights


Detailed Billing Reports

http://amzn.to/1swNwLV


Cost Explorer


Forecasting


Budgeting


AWS Well Architected

• Security• Reliability• Performance• Cost Optimisation

https://d0.awsstatic.com/whitepapers/architecture/AWS_Well-Architected_Framework.pdf


Creating a culture of cost transparency

Targets and Metrics Cloud Competency Center

AWS Enterprise Support


Metrics & targets

% Instances turned off daily% of Instances Right-Sized% Always on Resources Covered by RIs% RI Utilization

✔✔✔✔✘

✘

✘

✘

Set up metrics to define success and track progress

Smart Cloud UseFinancial Times approach to Cloud efficiency

Greg Cope

1

2

3

4

Agenda

What I am going to coverIntro

FT’s Approach in detail

Challengettes

Summary

Financial Times

Brexit slide ...

Me ...

Head of Platform Architecture and SecurityBeen at the FT a whileAWS certified

Lower barriers

Before you start - Find a way to ID costs

<AWSTag>CostCode</AWSTag>

Lots of AWS Accounts

Democratise the information

FT’s strategy

Democratise the Costs

You can have a central “Cloud” team and task them with cost control…We chose to show back the costs to technical managers and engineersAnyone at the FT can get a viewWhich needs to be simple/appropriate/accessible

We came up with simple, measurable, metrics

FT’s Approach in detail ...

Before we start

This is much easier having dedicated resources ...

… So big “Thanks” to the Cloud Enablement Team @FT

… As well as the tech teams who have implemented much of this

FT’s strategy

1.Dedicated resources

2.Use AWS Rich services rather than “instances”

3.Switch off non-prod

4.Review Operating Systems costs

5.Use newer instance types

6.Reserved Instances

Use AWS Rich services

Metric: on-demand as a % of the overall bill

Switch off non - production

Metric: non-production less than 16 instance hrs / day ~ weekends 2 hrs

Consider OS

How much does your OS cost you?Simple CPU cost vs $?

Licence/subscription costs overheads?

With uServices and 12 Factor applications become less coupled to their OSMetric: Less expensive OS instances as % of whole

Newer instancesNew instances are often more performant, at around 25% cheaper

Previous Gen. Current Gen. % Saving Saving Per Hourt1.micro t2.micro 7.5% $0.006m1.large m4.large 23.2% $0.058m1.xlarge m4.xlarge 26.2% $0.115

Metric: 0 old instance types

Reserved instance types

FT’s 1 year Reserved Instances (RIs) savings estimate of ~34%Only useful after all of the previous steps are done... otherwise you are buying the wrong RIs

Metric: X number of RIs applied

Roll out approach

Work with a team to demonstrateThat it is possible

That it works (saves $$$)

Act as techy evangelists

Challengettes

Fear of the unknown

Our stuff will not work

How to switch it on/off

Jenkins Jobs

Lambda Cronjobs

Other challengettes ...

IP Firewall rules broken when hosts come up with new IPMonitoring noiseSchedulers brokeDifferences between similar OS’es

Summary

But… much higher instance productivity + $$$ saved

Obligatory recruitment slide

https://www.linkedin.com/company/financial-times/career

Thanks,

For listening ...

AWS Cost optimisation; http://goo.gl/M9hLC3;

https://github.com/Financial-Times/ec2-powercycle

[email protected]


Recap

Simple Stimulating Stretching

Consolidated BillingPermissionsTaggingIdle Resources


Instance Right SizingStoragePurchasing Options

OS LicencingOffloading Architecture



If you need extra help


AWS Professional Services

• A global team of consultants across EMEA, APAC and the Americas

• Work with Enterprise and mid-market customers across many industries

• Specialists in IT Transformation, Security, DevOps, Big Data and Infrastructure

• Medium to long-term engagements of one month or more

• Provide guidance, advice, best practice and accelerates adoption

Partners


Resources to get you startedAWS TCO Calculatorhttps://awstcocalculator.com

AWS Economics Centrehttp://aws.amazon.com/economics/

Case Studies & Researchhttp://aws.amazon.com/economics/

Please remember to rate this session under My Agenda on

awssummit.london


Email me if you have any questions about today’s presentation:[email protected]

Thank You!

cost optimization at scale

Technology