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3 Best Practices for Reducing and Governing Cloud Spend

Cloud | Posted on February 13, 2017 by Karen Bader

The original version of this post was contributed by Rachel Dines, Director of Product Marketing at CloudHealth Technologies. and featured on the CloudHealth Tech Blog.

Amazon Web Services (AWS) started what I like to refer to as the “Cloud Gold Rush” in 2006. They began offering storage at a monthly rate of 15 cents per GB, and compute at an hourly rate of 10 cents. This caught the attention of thousands of organizations looking to decrease IT costs. Although prices have dropped drastically throughout the years – AWS claims over 50 price drops – many organizations discovered migrating to the public cloud didn’t necessarily result in the expected cost savings. Companies actually found their public cloud bills were two to three times higher than expected.

This does not mean migrating to the public cloud is a mistake. There are many benefits that come with utilizing a public cloud infrastructure, such as simplified operations, responsiveness, agility, improved security, and greater innovation. The mistake is the assumption that moving to the public cloud without implementing any sort of governance, management, or automation, will result in cost savings. It’s an oversight of the fact that people and process have a larger impact on solving problems than technology alone. The speed, flexibility, elasticity, and utility-based cost of the cloud requires the capability to consistently optimize and govern environments, and track and manage changes that occur as you scale.

Have you taken a look at your AWS bill lately and wondered “how can I get this back in check?” Here are three ways leading cloud innovators maintain control over their cloud spend.

Utilize Reserved Instances (RIs) – and make sure they’re optimized

If you’re not already taking advantage of AWS RIs, you’re missing a big opportunity to save money. Perhaps you are overwhelmed by the range of choices (there are a lot!), or not able to find time for the analysis (who has free time?). RIs have the potential to save you up to 75% as opposed to On-Demand pricing, making them an obvious choice for organizations with continuous EC2 or RDS usage. For a quick overview of RIs and to familiarize yourself with their benefits, I suggest reading this eBook.

Rightsize your infrastructure consistently

Cloud workloads are naturally dynamic – the capability to scale workloads up and down on-demand is a huge benefit of the public cloud. Workloads are also self-service: they can be easily spun up by anyone who needs to provision them, just by logging in. However, they can also come with a pitfall: many companies’ compute instances tend to be highly underutilized for two primary reasons. A workload is either not as resource-intensive as it once was, or someone has over-provisioned the instance (whether by accident or on purpose). Without proper management, this drives up cost rapidly. Check out this blog post for the easiest way to understand rightsizing, and why it’s so important.

Terminate zombie instances

Zombie instances are pertinent and not to mention costly, issue. Just for kicks, go take a gander at your C-type EC2 instances – it is likely that anything below 5% CPU utilization is a zombie. It is also not uncommon to see thousands of dollars of EBS volumes in AWS that are unattached. These volumes are costing you money, even though they’re not being used for anything. A good rule of thumb is to terminate any volume that has been unattached for two weeks, as it is likely a zombie.

Final thoughts

Since the only constant is change, you have to consistently search for ways to optimize your cloud infrastructure, adjust reservations, and terminate zombies, or else you risk leaving serious cost savings on the table. You need a way to get visibility into your cloud costs, drive accountability, and establish governance policies. This will set you up in the best position to control your cloud expenses and accurately forecast future costs.

Learn more about Softchoice Cloud Manage Services to see how you can manage your cloud spend and forecast future costs.


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