Short-term cloud cost optimization strategy are one way to improve cloud cost efficiencies, but if you want to stay on track, you also need long-term strategies to eliminate unnecessary cloud spending.
Traditionally, companies turn to short-term cloud cost control fixes, using tools to identify inefficiencies in existing workloads. But that’s just part of the solution. True cloud cost optimization requires long-term planning and smart architectural decisions.
There are three main cost-reduction strategies, although they only address short-term expenditure:
Right-sizing. Cost management tools determine whether the setup is the most competitive solution for a specific workload. For example, it could help identify another Amazon EC2 instance that would provide the same output for a certain workload that is currently running at a lower cost.
Auto scaling. usually carried out using a system provided by a cloud provider, automatically increases or decreases the allocation of resources to a running workload in response to changes in demand.
Reserved instances. Reserved instances, such as Amazon EC2 Reserved Proceedings and Azure Reserved VM Proceedings, cost less than on-demand VMs. However, they need to be booked ahead of time, so they fit best with predictable, static workloads.
With these techniques, companies can react in real time or close to real time. Right-sizing and auto scaling enable users to customize configurations when workloads are already running on a specific cloud platform. And while reserved instances can be set up ahead of time, they’re usually not very far in advance — days, at most.
Six Long-term Optimization Strategies
To keep cloud budgets under control, businesses need to adopt long-term cloud cost optimization strategies. However, unlike most short-term options, these approaches can not be implemented by a single tool. Alternatively, we need a more complex and nuanced review of the business needs and the cloud-based solutions available to meet them. Through this study, companies can make decisions that lead to lower cloud computing costs over the long run.
Although cloud cost management techniques can differ by company, there are six common approaches that can help many businesses.
Choose the right provider
Finding a provider that reduces your costs is easier said than done, given all the variables involved in cloud computing bills. Cost calculators, such as AWS Total Cost of Ownership Calculator and Microsoft Azure Pricing Calculator, can provide a relatively accurate estimate of the cost of a given workload.
Keep in mind that you may find lower prices from a cloud provider that specializes in a particular type of cloud service compared to general-purpose cloud providers. For example, a provider that focuses primarily on cloud storage, such as Wasabi or Backblaze, may prove more cost-effective in storing workloads than AWS, Microsoft Azure or Google Cloud.
Choose the right type of service
No matter which cloud provider— or provider — you use, it could offer multiple types of cloud services that could be used to achieve the same goal. For example, a typical application could be hosted using standard VMs for services such as Amazon EC2, or it could be containerized and hosted by Amazon Elastic Container Service or Elastic Kubernets Service. It could theoretically also be hosted in a serverless computing environment.
The cost, performance and management complexity of each of these strategies differ. Cost management, therefore, requires finding the type of service that provides the best balance between cost and other needs.
Choose a cost-efficient redundancy strategy
There are several approaches to achieving consistency in the cloud today. One approach is to choose a hosting solution that distributes workloads across multiple data centers in the same cloud area. This technique is usually the least costly, although it also offers the lowest level of redundancy. Likewise, users can duplicate a workload across two or more cloud regions, but this usually doubles the workload bill for cloud computing.
Another option is to take a multi-cloud approach by running workloads in two different clouds at once. This can also triple the bill and bring additional challenges to the multi-cloud architecture. But it provides the highest level of redundancy.
Not all workloads require the same degree of redundancy, and some do not need redundancy at all. The aim is to choose a strategy that meets the needs of the enterprise, but does not provide extra, unnecessary features that cost more.
Fix cost-inefficient architecture
How cloud resources or services interact can have significant implications for long-term cloud costs. Consider information egress— In most cases, cloud providers charge a fee any time data enters the cloud. Cloud infrastructure that often needs information to leave the cloud could lead to considerable costs that could be avoided with a different setup.
Egress-related cost bloat can be particularly challenging in multi-cloud environments, where data often crosses cloud boundaries. Enterprises must analyze their workloads to reduce excessive data movements.
Choose cost-efficient tooling
Most provider governance, monitoring and security tools are free to use for workloads running in their clouds. Nevertheless, companies can also incorporate third-party applications to supplement or complement the features of native cloud platforms. In many instances, the additional features of third-party software are cost-effective. Nonetheless, it is possible for companies to spend money needlessly if they implement more of these resources than they need, or if they opt for a third party product in cases where the vendor’s native tool will work just as well.
If you’re running all of your workloads on a single cloud today, but expect to follow a multi-cloud strategy in the future, third-party tools that work with both of the clouds you’re planning to use may be worth it, even if it costs more. Yet companies with no plans to move away from a single cloud can save more money by sticking to the cloud vendor’s native offerings.
Don’t overlook on-premises infrastructure
In spite of the cloud hype, do not overlook on-site options when planning the most cost-effective strategy.
The cloud is strong, but it’s not always a cheaper option for a few workloads. Occasionally, on-site technology provides a better trade off between cost and performance. This is particularly true in the case of workloads involving high data volumes or those requiring specialized hardware configurations, such as a bare-metal server, which cost extra in the cloud. Don’t be afraid to repatriate workloads that are already running in the cloud if on-site hosting appears to be cheaper.