The shift to public cloud providers such as AWS offers many advantages for companies. According to Your Amazon Web Services (AWS) CEO Andy Jassy, the conversation starter for cloud adoption is almost always cost savings. For many companies, this means trading the old model of heavy capex for capital to invest in data centers and servers upfront to a variable expense model of pay-as-you go.

To maximize the cost optimization model of using AWS, you need ensure that you are using the many tools that AWS provides for monitoring and managing your usage, taking advantage of EC2 Spot instances and Reserved Instances, and optimizing your EC2 instances and storage for cost savings.

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Here are five ways to optimize your AWS costs to save on your AWS bill:

1. Monitor and analyze your monthly AWS bill and usage

You should collect and analyze usage statistics on a regular basis and review your EC2 capacity overtime. There are a number of tools that AWS provides to help you monitor usage and unlock potential cost savings. AWS Trusted Advisor and Amazon CloudWatch are helpful monitoring and management tools to access metrics on your instance usage, including identifying idle resources and best practices.

In addition, AWS provides the following monitoring and reporting tools to help you manage your AWS costs: Cost Explorer, budgets, and cost and usage reports. Based on the analysis conducted, you can assess your workloads and scale your instance size up or down.

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2. Turn-off Unused EC2 Instances

Idle EC2 instances can be a major cost contributor to your AWS bill. Letting EC2 instances sit idle means that you accrue charges for something you are not using. For example, if you have a development environment that’s only used during the day and the weekdays, programmatically stopping it at night and end of the week and starting it again the following morning can cut your costs almost in half.

You can use Amazon CloudWatch alarms to automatically stop or terminate instances that have been idle for longer than a specified period.

3. Spot Instances, Spot Instances, Spot Instances

Amazon EC2 Spot instances allow you to bid on spare Amazon EC2 computing capacity at a discount compared to On-Demand pricing. AWS allows you to scale services for short-term usage and helps you reduce your bill.

According to AWS, you can “significantly reduce the cost of running your applications and lower your operating costs by up to 90% compared to on-demand instances.” Spot instance price fluctuates based on the supply and demand of available unused AWS EC2 capacity.

4. Take advantage of EC2 Reserved Instances

Reserved Instances are one of the most powerful cost saving tools available on AWS. EC2 Reserved Instances provide a discounted hourly rate and an optional capacity reservation for EC2 instances. In exchange for a commitment of one or three years, you get a discount on your instance costs.

With Reserved Instances, you can save up to 75% over equivalent on-demand capacity. On-Demand instances are a good option if you run your Amazon EC2 Instances a couple of hours a day or a few days per week. However, if you plan to run your Amazon EC2 Instances more than that, Reserved Instances can save you money and are worth investigating.

5. Optimize Your Storage

Your Amazon Web Services (AWS) provides multiple storage tiers at different prices designed to meet requirements for performance, availability, and durability. Amazon offers three broad categories of storage services: object, block, and file storage. Amazon’s object storage offering, Amazon Simple Storage Service S3 is the most cost effective of the three storage categories.

Within Amazon S3, you can easily move data between the storage options – Amazon S3 Standard, Amazon S3 Standard Infrequent Access, and Amazon Glacier – to balance frequency of access with price to optimize storage costs.

This short paper will teach you five ways to optimize your AWS costs to save on your AWS bill, including: 

  • Monitoring and analysis of your monthly AWS bill and usage reports
  • Optimizing your storage and compute spend And More!

To read full download the whitepaper:
5 Ways to Optimize Your Amazon Web Services (AWS) Spending