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Effectively Manage Cost for AWS and Cloud Services

Organizations all around the world and across every vertical are moving to the cloud to increase business agility, gain economic benefits and take advantage of a rich breadth and depth of services. However, when reviewing their bills, organizations can be surprised. The same simplicity that drew them to the cloud—the ease of adding servers and storage—can make it just as easy to rack up charges without understanding the long-term costs.

When developers spin up servers and databases without fully considering their capacity needs or ongoing usage costs, the organization can be stuck with over-provisioned or zombie services where the meter continues to run after developers have moved on. Even while active, computing instances may be too large for the application needs, also wasting money.

It’s like leaving all the lights on and air conditioning cranked up when you’re away on a long vacation—a big utility bill for nothing.

It’s Time to Modernize Your AWS and Cloud Cost Management
In most organizations, IT cost management processes are designed for an era of relatively steady expenses that don’t radically fluctuate from month to month. IT staff typically checks the costs for various accounts monthly or quarterly, and cleans up as necessary.

But in the era of dynamic cloud services, users can instantly spin up the equivalent of a rack full of equipment between cost checkpoints. And the resulting cost could tip the IT budget far out of balance.

Get Real-Time Visibility Into Costs
IT cost management practices must be updated when adopting cloud services. Processes must shift from monthly or quarterly (or even sporadic) cost checks to real-time monitoring and active financial management.

Cost information should be easily accessible in dashboards tailored to different stakeholders: developers, procurement managers, project leads and IT executives. Extending cost visibility to all users means that they can quickly and easily see their resource usage and the cost implications of their decisions. And they can be held accountable.


Using analytics to correlate cost and usage data can shine a spotlight on wasted resources, such as underutilized or idle Amazon Elastic Compute Cloud (Amazon EC2) instances and excess database or storage capacity. This information can incentivize necessary, real-time housekeeping by showing users where they can downsize or decommission other underutilized cloud resources without adversely affecting their applications or ongoing development projects.

Five Steps to Better AWS and Cloud Cost Management
Organizations can modernize their approach to controlling AWS and cloud costs by implementing the following five steps:

  1. Replace periodic cost assessments with real-time monitoring. Collect detailed infrastructure billing records into a single repository, which can be analyzed in real-time to show spend, usage and resource utilization. The analysis should allow cross tabulation to break out spend by user, project, department or other relevant organizational units.
  2. Extend cost visibility to all stakeholders, including developers. The same people empowered to create and use new cloud resources must be accountable for the cost. This is only possible if they have convenient access to meaningful data in real time—not days or weeks after they spin up new instances.

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  1. Correlate cloud computing costs and infrastructure usage; use dashboards to make the usage explicit by project, workgroup and user; and enable alerts. Developers and other users should be able to set alerts when key performance indicators, such as CPU, storage or memory utilization, drop below a certain percentage. These alerts can then trigger manual or automatic remediation that redeploys to smaller, less expensive instances.
  2. Use cost and usage data analysis to automatically provide cost projections for different pricing models. Amazon EC2 pricing, for example, can be complex, with various rates and discounts for on-demand, spot, pre-emptible and reserved usage, which makes it hard to know which billing model delivers the lowest cost for a particular application. A cost management system must cut through the complexity with easily understood visualizations that point users to the most cost-effective deployment model.
  3. Choose a cost management solution that uses machine learning to identify billing anomalies and proactively detect potential problems. Automation and machine learning lifts the burden from IT staff.

The only way to enact all five steps and truly enable modern IT cost management is by correlating and analyzing data from multiple sources and presenting insights in prebuilt dashboards.

Splunk software is designed to aggregate, analyze and visualize massive amounts of data in real time. With solutions like the Splunk App for AWS, IT can correlate and analyze data from multiple sources, including AWS billing data, and present those insights via easy-to-understand dashboards, reports and recommendations. The Splunk solution lets IT see, and show users, their true usage on AWS.