AWS Academy Cloud Foundations Module 5: Cloud Economics and Billing PDF

AW S A c a d e m y C l o u d F o u n d a t i o n s Module 5: Cloud Economics and Billing © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Module overview Topics Activities Fundamentals of pricing...

AW S A c a d e m y C l o u d F o u n d a t i o n s Module 5: Cloud Economics and Billing © 2019, Amazon Web Services, Inc. or its Affiliates. All rights reserved. Module overview Topics Activities Fundamentals of pricing AWS Pricing Calculator Total Cost of Ownership Support plans scavenger hunt AWS Organizations AWS Billing and Cost Management Technical Support Demo Overview of the Billing Dashboard Knowledge check © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 2 eserved. Module objectives After completing this module, you should be able to: Explain the AWS pricing philosophy Recognize fundamental pricing characteristics Indicate the elements of total cost of ownership Discuss the results of the AWS Pricing Calculator Identify how to set up an organizational structure that simplifies billing and account visibility to review cost data. Identify the functionality in the AWS Billing Dashboard Describe how to use AWS Bills, AWS Cost Explorer, AWS Budgets, and AWS Cost and Usage Reports Identify the various AWS technical support plans and features © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 3 eserved. Module 5: Cloud Economics and Billing Section 1: Fundamentals of pricing © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r eserved. AWS pricing model Three fundamental drivers of cost with AWS Compute Storage Data transfer Charged per Charged typically per Outbound is hour/second* GB aggregated and Varies by instance type charged Inbound has no charge (with some exceptions) *Linux only Charged typically per GB © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 5 eserved.  How do you pay for AWS? Pay for what you use Pay less when you reserve Pay less when you use more and as AWS grows © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 6 eserved. Pay for what you use Pay only for the services that you consume, with no large upfront expenses. On premises AWS © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 7 eserved.  Pay less when you reserve Invest in Reserved Instances (RIs): Save up to 75 percent Options: EC2 instance All Upfront Reserved Instance (AURI)  largest discount Partial Upfront On NURI PURI AURI Reserved Instance Demand (PURI)  lower discounts No Upfront Payments Reserved Instance (NURI)  smaller discount © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 8 eserved.  Pay less by using more Realize volume-based discounts: Savings as usage increases. Tiered pricing for services like Amazon Simple Storage Service (Amazon S3), Amazon Elastic Block Store (Amazon EBS), or Amazon Elastic File System (Amazon EFS)  the more you use, the less you pay per GB. Multiple storage services deliver lower storage costs based on needs. © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 9 eserved.  Pay even less as AWS grows As AWS grows: AWS focuses on lowering cost of doing business. This practice results in AWS passing savings from economies of scale to you. Since 2006, AWS has lowered pricing 75 times (as of September 2019). Future higher-performing resources replace current resources for no extra charge. © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 10 eserved. Custom pricing Meet varying needs through custom pricing. Available for high-volume projects with unique requirements. © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 11 eserved. AWS Free Tier Enables you to gain free hands-on experience with the AWS platform, products, and services. Free for 1 year for new customers. Sign up for an Learn with 10- Start building AWS account minute tutorials with AWS © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 12 eserved. Services with no charge Amazon VPC Elastic Beanstalk** Auto Scaling** AWS CloudFormation** AWS Identity and Access **Note: There might be Management (IAM) charges associated with other AWS services that are used with these © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 13 eserved. services.  There is no charge for: Key takeaways Inbound data transfer. Data transfer between services within the same AWS Region. Pay for what you use. Start and stop anytime. No long-term contracts are required. Some services are free, but the other AWS services that they provision might not be free. 14 © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r eserved. Module 5: Cloud Economics and Billing Section 2: Total Cost of Ownership © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r eserved. On-premises versus cloud Traditional Infrastructure AWS Cloud ≠ No upfront Improve time to Equipment Resources and expense—pay market and administration for what you agility use Scale up Self-service Contracts Cos and down t infrastructure © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 16 eserved. What is Total Cost of Ownership (TCO)? Total Cost of Ownership (TCO) is the financial estimate to help identify direct and indirect costs of a system. Why use TCO? To compare the costs of running an entire infrastructure environment or specific workload on-premises versus on AWS To budget and build the business case for moving to the cloud © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 17 eserved. TCO considerations Hardware: Server, rack Software: Operating Facilities cost chassis power distribution system (OS), 1 Server Costs units (PDUs), top-of-rack virtualization licenses (TOR) switches (and Space Power Cooling (and maintenance) maintenance) Hardware: Storage disks, Facilities cost storage area network (SAN) Storage administration 2 Storage Costs or Fibre Channel (FC) costs Space Power Cooling switches Network hardware: Local Facilities cost area network (LAN) Network administration 3 Network Costs switches, load balancer costs Space Power Cooling bandwidth costs 4 IT Labor Costs Server administration costs © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 18 eserved.  On-premises versus all-in-cloud You could save up to 96 percent a year by moving your infrastructure to AWS. Your 3-year total savings would be $159,913. Server Storage Network IT-Labor Total 400000 350000 300000 250000 200000 150000 100000 50000 AWS cost includes business-level support and a 3-year PURI EC2 instance 0 On-Premises AWS © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 19 eserved.  AWS Pricing Calculator Use the AWS Pricing Calculator to: Estimate monthly costs Identify opportunities to reduce monthly costs Model your solutions before building them Explore price points and calculations behind your estimate Find the available instance types and contract terms that meet your Access the AWS Pricing Calculator needs Name your estimate and create and name groups of services © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 20 eserved.  Reading an estimate our estimate is broken into: first 12 months total, total upfront, and total monthly First 12 months total Total upfront Total monthly © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 21 eserved. Activity: AWS Pricing Calculator activity Break up into groups of four or five and use the AWS Pricing Calculator and specifications provided to develop a cost estimate. Be prepared to report your findings back to the class. AWS Pricing calculator website © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 22 eserved. Additional benefit considerations Hard benefits Soft Benefits Reuse of service and Reduced spending on compute, storage, networking, security applications that enable you to define (and redefine solutions) Reductions in hardware and by using the same cloud software purchases (capex) service Reductions in operational Increased developer costs, backup, and disaster productivity recovery Improved customer satisfaction Reduction in operations Agile business processes that personnel can quickly respond to new and emerging opportunities Increase in global reach © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 23 eserved. Case study: Total Cost Of Ownership Background: Growing global company with over 200 locations 500 million customers, $3 billion annual revenue © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 24 eserved. Case study: Total Cost of Ownership Background: Growing global company with over 200 locations 500 million customers, $3 billion annual revenue Challenge: Meet demand to rapidly deploy new solutions Constantly upgrade aging equipment © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 25 eserved. Case study: Total Cost of Ownership Background: Growing global company with over 200 locations 500 million customers, $3 billion annual revenue Challenge: Meet demand to rapidly deploy new solutions Constantly upgrade aging equipment Criteria: Broad solution to handle all workloads Ability to modify processes to improve efficiency and lower costs Eliminate busy work (such as patching software) Achieve a positive return on investment (ROI) © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 26 eserved. Case study: Total Cost of Ownership Background: Is a growing global company with over 200 locations Have 500 million customers, $3 billion (USD) annual revenue Challenge: Meet demand to rapidly deploy new solutions Constantly upgrade aging equipment Criteria: Have a broad solution to handle all workloads Be able to modify processes to improve efficiency and lower costs Eliminate busy work (such as patching software) Achieve a positive return on investment (ROI) Solution: Moved their on-premises data center to AWS Eliminated 205 servers (90 percent) Moved nearly all applications to AWS Used 3-year Amazon EC2 Reserved Instances © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 27 eserved. Case study: Total Cost of Ownership © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 28 eserved. Case study: Total Cost of Ownership Business Goals: Growth Enhanced 24/7 business Results: Operational efficiency Resource Speed to market Operational optimization One day to provision efficiency Robust security new businesses Continuous cost compliance Just minutes to push optimization and out a service reduction Enhanced disaster recovery Increased computing capacity © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 29 eserved. Module 5: Cloud Economics and Billing Section 3: AWS Organizations © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r eserved. Introduction to AWS Organizations AWS Organizations © 2019 Amazon Web Services, Inc. or its Affiliates. All rights 31 reserved. AWS Organizations terminology © 2019 Amazon Web Services, Inc. or its Affiliates. All rights *Organizational Units (OUs) reserved. 32 Key features and benefits Policy-based account management Group based account management Application programming AWS interfaces (APIs) that automate Organizations account management Consolidated billing © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 33 eserved. Security with AWS Organizations Service control Control access policies (SCPs) with IAM policies enable enable you to allow AWS Identity and you to allow or deny or deny access to Access access to AWS AWS services for Management services for users, individuals or group (IAM). groups, and roles. accounts in an organizational unit © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r (OU). 34 eserved. Organizations setup Step 1 Step 2 Step 3 Step 4 Create Create Create Test Organization organizational service restrictions units control policies © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 35 eserved. Limits of AWS Organizations © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 36 eserved. Accessing AWS Organizations AWS Management Console AWS Command Line Interface (AWS CLI) tools Software development AWS kits (SDKs) Organizations HTTPS Query application programming interfaces © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r (API) 37 eserved. Module 5: Cloud Economics and Billing Section 4: AWS Billing and Cost Management © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r eserved. Introducing AWS Billing and Cost Management © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 39 eserved. AWS Billing Dashboard © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 40 eserved. Tools AWS Budgets AWS Cost and Usage Report AWS Cost Explorer © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 41 eserved. Monthly bills © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 42 eserved. Cost Explorer © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 43 eserved. Forecast and track costs © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 44 eserved. Cost and usage reporting © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 45 eserved. Recorded demo: Amazon Billing dashboard Amazon Billing dashboard demo 46 © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r eserved. Billing dashboard demonstration © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 47 eserved. Module 5: Cloud Economics and Billing Section 5: Technical support © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r eserved. AWS support Provide unique combination of tools and expertise: AWS Support AWS Support Plans Support is provided for: Experimenting with AWS Production use of AWS Business-critical use of AWS © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 49 eserved. AWS support Proactive guidance : Technical Account Manager (TAM) Best practices : AWS Trusted Advisor Account assistance : AWS Support Concierge © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 50 eserved. Support plans AWS Support offers four support plans: Basic Support – Resource Center access, Service Health Dashboard, product FAQs, discussion forums, and support for health checks Developer Support: Support for early development on AWS Business Support: Customers that run production workloads Enterprise Support: Customers that run business and mission-critical workloads © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 51 eserved. Case severity and response times © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 52 eserved. Activity: Support plan scavenger hunt Break up into groups of four or five and develop a recommendation for the best support plan for one of the business cases that are provided. Be prepared to report your findings back to the class. © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 53 eserved. Module 5: Cloud Economics and Billing Module wrap-up © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r eserved. Module summary Explored the fundamental of AWS pricing Reviewed TCO concepts Reviewed an AWS Pricing Calculator estimate Reviewed the Billing dashboard Reviewed Technical Support options and costs © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 55 eserved. Sample exam question Which AWS service provides infrastructure security optimization recommendations? A. AWS Price List Application Programming Interface (API) B. Reserved Instances C. AWS Trusted Advisor D. Amazon Elastic Compute Cloud (Amazon EC2) Spot Fleet © 2019 Amazon Web Services, Inc. or its Affiliates. All rights 56 reserved. Additional resources AWS Economics Center: http://aws.amazon.com/economics/ AWS Pricing Calculator: https://calculator.aws/#/ Case studies and research: http://aws.amazon.com/economics/ Additional pricing exercises: https://dx1572sre29wk.cloudfront.net/cost/ © 2019 Amazon Web Services, Inc. or its Affiliates. All rights r 57 eserved. Thank you © 2019 Amazon Web Services, Inc. or its affiliates. All rights reserved. This work may not be reproduced or redistributed, in whole or in part, without prior written permission from Amazon Web Services, Inc. Commercial copying, lending, or selling is prohibited. Corrections or feedback on the course, please email us at: [email protected]. For all other questions, contact us at: https://aws.amazon.com/contact-us/aws-training/. All trademarks are the property of their owners.