This document discusses how cloud computing provides resources over the internet that users can access on demand without upfront costs. It summarizes AWS's global infrastructure and pricing models, and how these enable startups to launch faster, scale more easily, and reduce costs. It provides examples of companies that have grown rapidly using AWS and recommends architectural patterns like caching, load balancing, and database optimization to further lower costs.

1. Running Lean on AWS
이수형 (niclee@amazon.com)
Solutions Architect / AWS Korea

2. What is Cloud Computing?
An analogy: think of electricity services…
Power is a utility service - available
to you on-demand and you pay
only for what you use.
You simply plug into a vast electrical grid managed
by experts to get a low cost, reliable power supply
– available to you with much greater efficiency
than you could generate on your own.

3. Cloud Computing is a utility service - giving you access to technology
resources managed by experts and available on-demand, available to
you with much greater efficiency than you could generate on your own.
You simply access these services
over the internet, with no up-front costs and
you pay only for the resources you use.

4. AWS
Global
Infrastructure
Components
Regions
An independent collection of AWS resources in a
defined geography
A solid foundation for meeting location-dependent
privacy and compliance requirements
Availability Zones (AZ)
Designed as independent failure zones
Physically separated within a typical metropolitan region
Edge Locations
To deliver content to end users with lower latency
A global network of edge locations supports global DNS
infrastructure (Route53) and Cloud Front CDN

5. On a global footprint
Region
US-WEST (Oregon) EU-WEST (Ireland)
ASIA PAC
(Tokyo)
ASIA PAC
(Singapore)
US-WEST (N.
California)
SOUTH AMERICA (Sao
Paulo)
US-EAST (Virginia)
GOV CLOUD
ASIA PAC
(Sydney)

6. Availability Zone
On a global footprint

7. Edge Locations
Dallas(2)
St.Louis
Miami
JacksonvilleLos Angeles (2)
Palo Alto
Seattle
Ashburn(2)
Newark
New York (2)
Dublin
London(2)
Amsterdam
Stockholm
Frankfurt(2)
Paris(2)
Singapore(2)
Hong Kong
Tokyo
Sao Paulo
South Bend
San Jose
Osaka
Milan
Sydney
On a global footprint

8. US West Region (Oregon)
Availability
Zone A
Availability
Zone B
Singapore
Availability
Zone A
Availability
Zone B
EU West Region
Availability
Zone A
Availability
Zone C
Availability
Zone B
Each Region has multiple Availability Zones. Availability Zones are
distinct locations that are engineered to be insulated from failures in
other Availability Zones and provide inexpensive, low latency network
connectivity to other Availability Zones in the same Region.

9. Cloud Computing Characteristics

10. All Clouds are NOT created equally

11. You begin your Startup in a garage…

12. …and build a fantastic app

13. people love it!

14. and everyone wants to use it…
Now what?!

15. Which company…
…grew to 14million users in just over a year
…reached 150million photos & terabytes of data
…signed up 10million users in 12 hours after launching an Android app
…with only 3 engineers?

17. HOW?

22. “Cloud is like a fertilizer that creates
Startups”
Eric Ries, author of NY Times
bestseller “The Lean Startup”
=

23. Benefits for Startups across the Lifecycle
Why Launch on the Cloud?
Lowering Costs with Smart Pricing
Lowering Costs with Architecture

24. Benefits for Startups across the Lifecycle

25. “Amazon Web Services is probably the most
important thing that has happened to mobile
and web app developers that the press just
misses. Jeff Bezos has accidentally or maybe
on purpose powered a whole generation of
applications.”
Steve Blank, author of “The Four
Steps to Epiphany”

26. “a whole generation of application…on AWS”
E-commerce Social Media
Media Sharing SaaS
Gaming
Mobile Apps
Big Data – Hadoop, HPC, etc
Ad hosting and analytics
Storage, backup, and disaster recovery
Life Sciences (sequencing, simulation, etc.)

27. 01 02 03 04
idea demo monetizescale
How do I
develop fast
and get to
market faster?
How do I
deal with
unpredictable
demand & scale
up easily?
How do I run
lean and
continue to grow
my revenue?

28. Launch your infrastructure in a few clicks so you can Reduce
Time to Market
Pay only what for you use, with no commitment and lock in, so you
can Experiment More at Lower Costs
Leverage community support, SDK’s, libraries, and more to
achieve Shorter Development Cycles
Experiment More & Develop Faster

29. aws.amazon.com/code aws.amazon.com/architecture
Code, Libs, SDK’s, Architectures

32. “AWS was the clear choice for us. They enabled us to launch our cloud
solution quickly with reliable, uninterrupted, secure service to our customers.”
Jaspreet Singh, Founder & CEO

33. Getting Started = FREE
“AWS Free Usage Tier = more startups. Awesome”
Tweet by Eric Ries
Elastic Compute Cloud (EC2)
Simple Storage Service (S3)
DynamoDB & SimpleDB
Simple Workflow (SWF)
Simple Queue Service (SQS)
Simple Notification Service (SNS)
Relational Database Service (RDS)
CloudWatch
Data Transfer

34. Full Elasticity for Maximum Scalability
Scale to 1000s of servers in minutes
Add billions of objects with Amazon S3
Globally distribute petabytes of data
Select any level of desired throughput
Fully automate the process of scaling up & down

37. “AWS is great for scalable requirements, whether you need to
scale up quickly, or even to scale down quickly, if required.”
Vishal Gondal, CEO of Indiagames

38. 70:30
Reduce Costs & Grow revenue
Pay only what for you use, with no commitment and lock in, so
No Up-Front Capital Expense
Leveraging our large scale, we have reduced our prices 19 times
in the last years, leading to Low Costs
AWS removes undifferentiated heavy lifting – allowing you to focus
on your business and Generate Revenue

39. "With the time savings that the IT and development staffs obtain from
the solution, AWS gives us an overall cost benefit of about 30-40%.”

40. Why Launch on the Cloud?

41. Pay as you go

42. When calculating TCO…
#1 Start by understanding your use cases & usage patterns

43. On and Off Fast Growth
Variable peaks Predictable peaks
Usage Patterns

44. Traditional HW / Hosting
On and Off Fast Growth
Predictable peaksVariable peaks
WASTE
CUSTOMER DISSATISFACTION

45. AWS = Elastic Capacity
Fast GrowthOn and Off
Predictable peaksVariable peaks

46. When calculating TCO…
#1 Start by understanding your use cases & usage patterns
#2 Apples to Apples – Take all the fixed costs into consideration

49. When calculating TCO…
#1 Start by understanding your use cases & usage patterns
#2 Apples to Apples – Take all the fixed costs into consideration
#3 Leverage economies of scale & price cuts

50. Each day AWS adds the
equivalent server capacity to
power Amazon when it was a
global, $5.2B enterprise
(circa 2003)

51. Massive economies of scale and efficiency
improvements allow us to continually lower
prices – 26 price cuts in last 6 years

52. When calculating TCO…
#1 Start by understanding your use cases & usage patterns
#2 Apples to Apples – Take all the fixed costs into consideration
#3 Leverage economies of scale & price cuts
#4 Take a look at what’s included: Intangible Cost Savings !

53. New Customers
Amazon EC2
Amazon RDS
Amazon ELB
Amazon S3
Amazon EBS
For All Customers
Amazon SQS/SNS
Amazon DynamoDB
Amazon SES
Amazon SWF
And more…
AWS Elastic Beanstalk
AWS CloudFormation
AWS IAM
Auto Scaling
Consolidated Billing
No Charge for
Inbound Data Transfer
Data Transfer between
Instances within an
Availability Zone
Free Usage Tier
Did you know?
Free Services Data Transfer

54. With AWS…
…standing on the shoulder of giants.

55. These Indian companies… are getting the same… as these companies:
DURABILITY
SECURITY
SCALABILITY
RELIABILITY
AFFORDABILITY

56. These Indian companies benefit from AWS… just like these companies:
E-COMMERCE
CONSUMER APPS
GAMING
ENTERPRISE / SaaS
MEDIA

57. Lowering Costs with Smart Pricing

58. Multiple pricing models allow you to
optimize costs for both variable and
stable workloads

59. Save more when you reserve
On-demand
Instances
• Pay as you go
• Starts from
$0.02/Hour
Reserved
Instances
• One time low upfront
fee + Pay as you go
• $23 for 1 year term
and $0.01/Hour
Utilization RI option Savings over On-Demand
<10% On-Demand
10% - 40% Light Utilization RI Up to 56%
40% - 75% Medium Utilization RI Up to 66%
>75% Heavy Utilization RI Up to 71%
3 versions:
• Light Utilization RI
• Medium Utilization RI
• Heavy Utilization RI
2 terms:
• 1-year
• 3-year

60. • 80 million objects stored in S3 with 410 terabytes of user data
• 150 EC2 instances in the web tier
• 90 instances for in-memory caching
• 35 instances used for internal purposes
• 70 master databases with a parallel set of backup databases in
different regions around the world for redundancy
Pinterest attracted almost 18 million visitors in March, a 50% increase from
February (ComScore). One of the fastest growing sites in the history of the web…

61. • Most traffic happens in the
afternoons and evenings, so
they reduce the number of
instances at night by 40%.
• At peak traffic $52 an hour is
spent on EC2 and at night,
during off peak, the spend is
as little as $15 an hour. The
difference is an amazing 71%

62. On-demand
Instances
• Pay as you go
• Starts from
$0.02/Hour
Reserved
Instances
• One time low upfront
fee + Pay as you go
• $23 (1 year)
$0.01/Hour
Spot
Instances
• Requested Bid Price
and Pay as you go
• Varying…$0.005/Hour
at 9am today
Save more money by using Spot Instances
Up to 85% savings over On Demand pricing

63. Spot Use cases
Use Case Types of Applications
Batch Processing Generic background processing (scale out computing)
Hadoop Hadoop/MapReduce processing type jobs (e.g. Search, Big Data, etc.)
Scientific Computing Scientific trials/simulations/analysis in chemistry, physics, and biology
Video and Image
Processing/Rendering
Transform videos into specific formats
Testing Provide testing of software, web sites, etc
Web/Data Crawling Analyzing data and processing it
Financial Hedgefund analytics, energy trading, etc
HPC Utilize HPC servers to do embarrassingly parallel jobs
Cheap Compute Backend servers for Facebook games

64. Lowering Costs with Architecture

65. “Give me 4 fault tolerant algorithms and I can pick the
best one almost with my eyes closed.
If you then ask me which one is best for the business,
in terms of dollar costs, I would be clueless.”
An engineer named
Werner Vogels, CTO, Amazon

66. 1. CACHE at the edge to offload static and dynamic content
2. DRY (‘Don’t Repeat Yourself’)
3. LOAD BALANCE from the start
4. AUTO SCALING done right
5. PILOT LIGHT for smart & cost effective DR
6. DATABASE smarts
7. A/B TEST for rapid prototyping & innovation
Lowering Costs with “Best Practice Architecting”

67. Overview of Services
Compute Content
Delivery
Storage Database Application
Services
Networking
Deployment &
Management

69. CACHE at the edge to offload static & dynamic content
• reduce your compute demand and costs
• improve end-user experience
• increase reliability and durability
+
Reduce EC2 Costs by Caching & Off-loading

71. DRY (don’t repeat yourself)
• original vs. derived assets : 33% savings
• single reference and consistency
• control, accurate logs and tracking
S3 (or Glacier) RRS
Reduce Costs of Storage by using S3 “RRS”

73. LOAD BALANCE from the start
• ready for massive scale, high reliability
• uninterrupted growth and evolution
• stateless and redundant array
Availability Zone
Availability Zone
Lowering Costs with “Best Practice Architecting”

74. Buuk for Singapore Press Holding (SPH)

75. AUTO-SCALING done right with Real Time reaction response
• Elastic Load Balancing and (event driven) Auto Scaling
• notification of pending news flash (with audible alarm)
• on-demand ramp up of capacity (6 mins.)
• subscriber alert push delivered
• mass response traffic handled (followed by ramp down)
Lowering Costs with “Best Practice Architecting”

76. Reduce Costs of DR with “Pilot Light” design
PILOT LIGHT for smart & cost effective DR
• In traditional IT, Disaster Recovery (DR) is an after-thought
• Costs of DR site are often an additional 80% of main DC
• Problems occur in Layer 8 of OSI-model (anyone?)
• With AWS, DR can be built into your architecture
• Example: ‘Pilot Light’ design, which is cost effective and provides
fast Recovery Time Objective / Recovery Point Objective
It looks like this…

77. Basic level EC2
Provisioned yet
Dormant
Singapore Region US East Region

78. Auto scaling Group
Resize to production
Capacity and/or add
read replicas
Start up in minutes,
Auto scale up in
minutes
Singapore Region US East Region
Auto scaling Group

79. Best Practices
DATABASE smarts
• scale out and share work
• optimal performance, minimize load
• enhance reliability, ensure data safety
• cost reduction Availability Zone
Availability Zone

83. Reduce Costs of Test/Dev and A/B Testing
A/B TEST for rapid prototyping & innovation
• inexpensive idea validation
• seamless switch over and versioning
• rapid dev / test agility

88. In Summary…

89. AWS Pricing Philosophy
Pay as you go
Pay less per unit when you use more
Pay even less when you reserve
• Reserved pricing
Pay even less when you architect for cost optimization
• Smart architecting and leveraging AWS managed services
Pay even less as AWS grows
• AWS economies of scale result in continuous price reductions
What does this look like in practice?

90. An example
Enterprise software provider in APAC
Focused on SaaS for storage, security, collaboration, etc.
Backed by leading VC’s in the region
Strong growth – winning customers globally
Focused on profitability & reducing unit costs
Worked closely with the AWS team to optimize its architecture

91. Profit
Growth
-10%
price drop
in S3
-20%
RI purchase
-22%
Migration
Cassandra
to Dynamo
-18%
Price drop in
S3 of 25%
54%
reduction in
unit costs

92. Questions?
이수형 (niclee@amazon.com)
Solutions Architect / AWS Korea