Week 4 - Cloud Economics and Billing Flashcards
What are the three fundamental drivers of cost with AWS, and how do they affect pricing?
The three fundamental drivers of cost with AWS are Compute, Storage, and Data Transfer:
- Compute is charged per hour/second and varies by instance type.
- Storage is typically charged per GB.
- Data Transfer has no charge for inbound transfers, is free between services in the same region, and outbound transfers are aggregated and charged monthly according to AWS data transfer out.
What are the three AWS pricing models, and what are their benefits?
- Pay as You Go:
Pay only for the services consumed with no upfront costs or long-term contracts.
Provides flexibility to start, stop, and delete resources at any time.
Ideal for development, testing, or when infrastructure cannot be purchased. - Pay Less by Using More:
Offers volume discounts and tiered pricing, where increased usage results in lower costs per GB.
Tailored storage services deliver reduced costs based on specific needs. - Pay Less When You Reserve:
Save up to 75% with Reserved Instances available in three options: All Upfront (AURI), Partial Upfront (PURI), and No Upfront (NURI).
Helps minimize risks, predict budgets, and align with policies requiring long-term commitments.
What are some additional AWS pricing models and free services?
- Pay Even Less as AWS Grows: Benefit from AWS economies of scale with lower costs and upgraded resources at no additional charge.
- Custom Pricing & AWS Free Tier: High-volume projects with unique needs; Free Tier offers 1 year of free AWS services for hands-on experience.
- Free AWS Services: Includes Amazon VPC, AWS IAM, and consolidated billing for tiered volume discounts and simplified tracking.
No-cost Tools: AWS Elastic Beanstalk, CloudFormation, Auto Scaling, and AWS OpsWorks.
What is TCO in AWS?
Total Cost of Ownership (TCO) is a financial estimate used to identify the direct and indirect costs associated with a system.
Why is TCO important?
TCO helps compare the cost of running an entire infrastructure on-premises vs. AWS and supports budgeting and building a business case for cloud migration.
What is the purpose of the AWS Pricing Calculator?
The AWS Pricing Calculator helps estimate monthly costs, identify cost-saving opportunities, model solutions before building, explore price points, find suitable instance types and terms, and organize estimates into named groups.
What are the hard and soft benefits of conducting a TCO analysis for cloud adoption?
Hard Benefits: Reduced spending on compute, storage, networking, and security; lower capex from fewer hardware/software purchases; decreased operational costs for backup and disaster recovery; fewer operations personnel needed.
Soft Benefits: Reusable cloud services, increased developer productivity, improved customer satisfaction, agile business processes for emerging opportunities, and greater global reach.
What is AWS Organizations and what are its benefits?
AWS Organizations is a free account management service that consolidates multiple AWS accounts into an organization for centralized management.
Benefits include:
Centrally managed access policies across multiple AWS accounts.
Controlled access to AWS services.
Automated AWS account creation and management.
Consolidated billing across multiple AWS accounts.
How is an AWS Organization structured, and how do Organizational Units (OUs) function?
An AWS Organization consists of a root that can contain multiple accounts organized into Organizational Units (OUs).
OUs are containers for accounts and can be structured hierarchically, resembling an upside-down tree with the root at the top.
Policies attached to any node in the hierarchy flow down and apply to all child nodes.
Each OU can have only one parent, and each account can belong to only one OU.
An account is a standard AWS account that contains AWS resources.
How can you access and manage AWS Organizations?
AWS Management Console: Browser-based interface to manage your organization and AWS resources.
AWS CLI: Command-line tool to perform AWS Organizations and general AWS tasks.
AWS SDKs: Simplify tasks like signing requests, error handling, and retries programmatically.
AWS HTTPS Query API: Programmatic access to AWS Organizations via direct HTTPS requests.
What is AWS Billing and Cost Management, and what are its features?
AWS Billing and Cost Management allows you to pay your AWS bill, monitor usage, budget costs, and forecast expenses. It supports custom time periods and provides data at monthly or daily granularity. The AWS Cost and Usage Report Tool helps identify optimization opportunities in your AWS implementation.
What is the AWS Billing Dashboard, and what features does it provide?
The AWS Billing Dashboard offers insights into month-to-date AWS expenditures, identifies major cost contributors, and helps understand cost trends. Key features include:
Spend Summary: Last month’s spend, estimated current usage costs, and a forecast of this month’s expenditure.
Month-to-Date Spend by Service: Displays top services used and their cost proportions.
What are three AWS billing tools?
AWS Budgets: Create custom budgets, set alerts for cost thresholds, and track usage against limits.
AWS Cost and Usage Report: Provides detailed insights into AWS usage and cost, enabling analysis and optimization.
AWS Cost Explorer: Visualize, analyze, and forecast AWS costs and usage trends.
