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Article Resource July 26, 2018

7 Ways Cost-Optimization Tools Can Help Lower Your Next Cloud Bill

Adoption of public cloud services has transformed the way companies manage their IT infrastructure.

Computer systems are no longer fixed upfront investments, but an everyday operational expense. Enterprise IT infrastructure has become a dynamic and complex environment, where users can spin up new cloud resources in a matter of clicks. What’s more, you can choose from a bewildering choice of instances, storage types and payment mechanisms, each designed to suit different use cases and levels of resource consumption.

This presents new challenges to operational management, where optimizing cost is as important as optimizing performance.

Cost monitoring and optimization tools are specifically designed to give you the visibility and control you need to keep your monthly cloud bills in check and reduce your management overhead.

But, in terms of functionality, what exactly do they do?

In this post, we look at 7 key areas in which cost-optimization tools help you identify efficiencies in your cloud environment and save money on your next cloud bill.

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1. Unused Instances

In the same way the cloud makes it easy to spin up virtual machines, it’s just as easy to forget about them. However, you pay for your cloud infrastructure whether you use it or not.

Cost-optimization solutions will help you address the issue of cloud sprawl, where an organization runs up massive bills through uncontrolled ordering of instances and other on-demand IT services—often as a result of development testing and shadow IT projects.

They do this by keeping track of all instances in your billing accounts, identifying those that are inactive or unhealthy and flagging them up for manual or automatic removal.

Cost Savings Report

Potential Cost Savings Report, via CloudCheckr

2. Instance Sizing

Many enterprise cloud users still have an on-premise mindset and provision far more capacity than they actually need.

To avoid unnecessary waste, you’ll need to analyze the resource consumption of your virtual machines to determine the correct instance sizing for optimum balance of cost and performance. The “Right Sizing” process can recommend larger sizes, smaller sizes, or even different types of instances, to better suit your computing needs.

This is no easy challenge in a large-scale enterprise cloud environment with potentially hundreds or thousands of instances running at any one time.

Cost monitoring tools automatically provide instance sizing recommendations, helping you to avoid hours of manual calculations. They can also help you match your workloads to more suitable alternatives in other instance families, such as switching from general-purpose instances to those designed for specific use cases.

right sizing recommendations screenshot cloudcheckr

Right Sizing Recommendations, via CloudCheckr

3. Unattached Persistent Volumes

Cloud inventory monitoring systems can also identify and delete unattached persistent storage disks, such as Amazon EBS volumes.

This is a particularly important housekeeping task for AWS and Microsoft Azure users as attached volumes aren’t automatically deleted when you terminate the associated instance—unless you change your default termination policy.

As a result, you could rack up unnecessary charges for storage you no longer need, especially if you leave SSD-backed volumes sitting around, which cost more than double their HDD counterparts.

Unattached EBS Volumes Best Practice Check, via CloudCheckr

4. Orphan Snapshots

Just as attached storage volumes remain after you terminate an instance, so do your volume snapshots.

While point-in-time backups on both AWS and Google Cloud Platform are incremental, the first snapshot is a compressed version of your entire disk. Depending on your retention period and how frequently you back up, you’ll need at least as much capacity again to store subsequent snapshots.

The storage cost of maintaining backups on Azure can work out even more expensive, as the vendor only supports full point-in-time snapshots.

Cloud cost management platforms can help you keep costs down by alerting you to orphan snapshots and providing a quick and easy way to remove them.

EBS Volumes with Excessive Snapshots Best Practice Check, via CloudCheckr

Automated Deletion of Snapshots, via CloudCheckr

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5. Underutilized Discount Capacity

Discounted alternatives to standard on-demand pricing, such as AWS and Microsoft Reserved Instances, can significantly reduce your overall cloud expenditure. As these are pricing constructs rather than actual running instances, they don’t necessarily require any direct operational management of your cloud infrastructure.

Reserved Instances can deliver savings in excess of 70%, where the exact discount depends on:

  • The type of instance and payment terms you choose.
  • The flexibility you require, such as the ability to change the specification of the running instances applicable to your purchases.
  • How well you utilize your reservations, by ensuring you have matching instances consuming your Reserved Instance credits as much of the time as possible.
  • With AWS Reserved Instances you can also achieve an immediate reduction in your bill, as you have the option to purchase them without any upfront payment.

More advanced cost-optimization tools provide support for discount mechanisms, such as Reserved Instances. For example, they can offer exchange suggestions for those Reserved Instances with built-in flexibility, ensuring reservations are better aligned to the resource consumption patterns of your applications.

They can also work the other way—by showing you where credits aren’t being used and making recommendations on how to rebalance your workloads so they’re covered by your unallocated reservations.

Furthermore, they can alert you to reservations that are about to expire, identify workloads that could benefit from a switch from on-demand to Reserved Instance pricing and make Reserved Instance purchase recommendations.

CloudCheckr RIPurchaseRecommendationsSummary screenshot

Reserved Instance Purchase Recommendations, via CloudCheckr

6. Best Practice Checks

In addition to your core cost-management responsibilities, you can implement a whole host of other measures to streamline the cost of running your cloud infrastructure.

More sophisticated cost-optimization solutions can help by performing best practice checks, which provide pointers to potential resource waste in your cloud environment.

For example, they can highlight redundant static IP addresses, unused provisioned storage capacity and idle load balancers—which, added together, can substantially increase the number of unnecessary charges in your monthly cloud bill.

cost savings best practices screenshot cloudcheckr

Cost Savings Best Practice Checks, via CloudCheckr

7. Automation

The longer you leave cloud inefficiencies unattended, the more quickly your costs mount up. But, by leveraging the automation features of cost-optimization tools, you can set instant responses to misconfigurations, nipping them in the bud as soon as they arise.

Not only that but they also do it 24 hours a day, 7 days a week, helping you to keep costs in constant check, avoid protracted manual procedures and free up your operations teams to focus on other aspects of running your cloud.

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Think Third-Party

To make a real success of cloud cost management, you should look beyond simply your cloud vendor’s in-house monitoring solutions.

Third-party cost tracking services have been developed with enterprise needs in mind, offering additional functionality, such as spending forecasts, cost allocation and multi-cloud capabilities. Some cloud management solutions also address security misconfigurations. After all, a security breach can cost far more than any cost savings tool can save.

But, above all, they offer a deeper level of insight that large-scale organizations need to manage their complex cloud environments—and a level of control that any cost-aware enterprise cannot afford to do without.

Todd Bernhard
Todd Bernhard is a Product Marketing Director at CloudCheckr. He has earned his AWS Solutions Architect Associate, AWS Certified Cloud Practitioner, Microsoft Azure Fundamentals, and Google Cloud G-Suite certifications. He has been administering, teaching and developing on Unix systems since 1984 including 16 years at Sun Microsystems, now part of Oracle. In 2010, Todd founded the award-winning app development firm This photo is the last known image of him wearing a tie!
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