The Hidden Costs of Cloud Computing 

Starting with your cloud infrastructure was simple. You ran up a few instances, maybe created an AD structure, added some storage; as it's easily scalable you added a few more things and the pay for what you use pricing seemed ideal. But very quickly you've added even more services and when you receive your next invoice you've been landed with an unexpectedly high bill. Now you start to analyse the invoice but there are thousands of line items and it can be almost impossible to identify what is needed, what is underutilised or poorly optimised so I'd like to give some pointers into ways that you can tame those costs and identify where the hidden extra charges may be hiding.

1. Unused Instances

As it's so easy to run up an instance in the cloud it may not be surprising that one of the biggest unnecessary costs is unused instances, so you end up paying for services you are not utilising. Managing change control should include turning off instances when they are no longer being used.

2. Under Used Instances

You need to be proactively monitoring your usage data. Low CPU usage, bandwidth and I/O are all indicators of underutilised servers that could be shutdown.

3. Orphaned Snapshots

Once you have terminated the unused instances they attached EBS volumes are automatically deleted. However, your snapshots will remain on the storage and you will still be picking up this cost until these too are deleted. Deleting these snapshots will produce a saving the same size as deleting the EBS volume, so when you are sure you no longer need them, make sure they are deleted.

4. EBS Volumes

It is best practice to delete EBS volumes, except for root volumes, if they are not attached to instances as they will be charged for whether they are used or not. It should go without saying that you should back these up before deleting them but we have had to come to the rescue a few times where this has not been the case.

5. Reserved Instances

Sometimes companies use pre-booked resources and capacity for a one or three year term called reserved instances (RI). This gives a heavily discounted rate as the company has committed to pay for all the hours during their contract term. But if these reserved instances are not used then the savings are wasted and can result in high cost than if the company had chosen to use a pay as you go model. If you have purchased reserved Instances that you are not using you may want to consider selling them on the AWS marketplace.

6. Data Transfer

Transferring data out of EC2 incurs a charge, this is dependant on what region the data resides in, where it is going and of course how much data is being transferred. Because of these variables moving data across services in different regions can throw up unexpected costs. Understanding these costs and planning accordingly can save money.

7. Elastic IP (EIP) Addresses

Additional EIPs are charged over and above the free one allocated with each EC2 instance, these need to be managed to ensure you are not paying for unused services.

Unless you plan, monitor and proactively manage your cloud infrastructure the cloud may well be more expensive than your old in-house deployment. Most organisations are running multi-cloud, so while we have looked primarily at AWS in this piece Microsoft Azure has just as many opportunities for hidden costs that can shock.

Operating and managing cloud infrastructure is a complex task. It requires skills that have not been common in most IT teams and as such, it can lead to hard conversations and decisions if the costs have not been budgeted for. Working with specialists who are experienced in planning, deployment and management of cloud infrastructure will give you access to these skills and provide you with manageable, planned costs which are lower than traditional infrastructure deployments.

Don’t leave it to chance, speak to our team today and we will work with you to tame your costs.

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