Cloudyn's VP of Products, Vittaly Tavor, discusses cost performance in a multi-cloud environment. In this presentation various cloud cost issues are covered - from migration from on-premise to the cloud, through comparing different Iaas pricing models, hot tips on optimizing cloud costs to full multi-cloud cost management

1. Multi-cloud Economics
February 26, 2014
IGT Cloud Workshop
Vittaly Tavor – VP Products,
Cloudyn

2. Agenda
• Cost Structure
• Cost Management
• The Importance of Cost Management
• IaaS Pricing Models
• Cloud Cost Distribution
• Cost Management Tips
• Q&A

3. Cloud cost structure
On-Premises/Private Cloud
• Capex Examples
– Floor space
– Air Conditioning Systems
– Hardware Equipment
– Network Infrastructure
– Management Software
• Opex Examples
– Monthly Bills (Electricity,
Internet etc.)
– Licensing
• HR
Public Clouds
• Capex Examples
– None (well, depending how
you define packages
purchased in advance)
• Opex Examples
– On-demand Service
Consumption
– Timed Storage
– Network Bandwidth
– Licensing (in BYO models)
• HR

4. Worldwide spending on servers (IDC, 2012)

5. Effects of server aging (IDC, 2012)

6. Cloud financial advantages – theory
• No initial investment
• Only operating expenses (OpEx)
• Pay only for what you need
• Allow temporary access to vast resources,
infeasible otherwise
• CFO nirvana

7. Cloud financials - reality
• Welcome to a resource sprawling world
• Resources are typically over-allocated
• Hidden costs
• Highest rates
• Each bill – new surprises
Cost needs to be tightly managed!
Cloud may be really beneficial, but
if you don’t pay attention:

8. Cost importance
• Traditional IT detects issues using APM tools
• In a cloud, cost is the first indication of an issue!
– Unneeded instances
– Degraded performance
– Increased I/O
– Increased query size
• Cloud cost monitoring exposes anomalies

9. Cloud pricing models
• On-demand
– No commitments, charged by minute/hour
• Commitment-based (Google)
– Commit for minimal payment. Not yet available through self-
service
• Hours commitment plan (Azure)
– Purchase “hours bank”
• Reserved instances (Amazon)
– Initial one-time fee
– Lower usage fees
• Spot instances (Amazon)

10. Cloud cost distribution
Service Total Cost %
Instances 66.07%
Disks 16.16%
Storage 4.38%
SQL DB 5.08%
Support 3.64%
Load Balancers 1.34%
Rest 3.33%

11. Buying a cloud “instance”
• Server Type ($100 - $60,000 / year)
– CPU
– Memory
– I/O
– Network (Possibly at additional costs)
– Special Features (SSD, GPU, …)
• Persistent Disk(s) ($0.04-$0.05/GB/Month)
• Bandwidth Costs ($0.15/GB)
• Loadbalancer ($0.025/Hour + $0.008/GB)
• Monitoring

12. Comparing clouds – instances
• Charge resolution (minute? hour?)
– Amazon – by hour
– Google – by minute, min. 10 minutes
• Committed price plans
– Google – usage commitment
– Amazon – reserved, spots
• Amazon special-purpose instances

13. Comparing clouds – disks
Example: 100GB disk, ~500 provisioned IOPS
• Google:
– Timed storage: 100 x $0.04 = $4/month
– No IO costs
• Amazon:
– Timed storage: 100 x $0.125 = $12.5/month
– IOPS: $0.1 x 500 = $50/month (!)
– An instance should be launched as EBS-optimized

14. Tips
• Use special pricing wherever possible
• Plan for a possibility to switch providers
• Search for hidden costs – these may be very
high
Manage your costs on daily bases!

15. Cloudyn at a glance
• Multi-dimensional cloud analytics (full visibility)
• Cost, performance, usage and lifecycle
• Actionable recommendations for
– Resources relocation & reassignment
– Right-sizing
– Best pricing selection
• Cost and capacity planning
We monitor and optimize cloud deployments

16. Smile

17. Thank You
vit@cloudyn.com