• Cost optimization in cloud is of extreme importance in today’s cloud usage scenarios
  • This is mainly because most of the SMBs and enterprises have already moved to the cloud but don’t have internal IT technical capabilities to manage the cloud resources
  • Cost optimization is a part of managed services in cloud provided by various Managed Service Providers(MSPs)
  • Managed Service Providers(MSPs) help organizations reduce their cloud spend drastically by analyzing their environment and providing suggestions on how the spend can be reduced
  • They perform deductive and predictive analytics on their past and expected cloud spend respectively.
  • They help them make sense of their cloud usage bill and attribute the spend to different projects, departments, teams, applications and cost centers
  • Reserved VM instances and upfront payment strategies in both AWS and Azure help in saving upto 75% of the operational VM expenditures
  • Spot Instances in AWS can reduce operational costs by up to 90% for various fault-tolerant and flexible applications such as test & development environments, stateless web servers etc

The Optimization Process

Usage Visibility & Cost Control –

  • Granular visibility into usage by department, project, region, workload, app or users allows CIOs to attribute chargeback and prioritize their IT spending
  • These visualizations can be represented in dashboards to effectively present the usage and cost analysis which will in turn help in identifying the inefficiencies

Forecasting –

  • Demand and cost forecasting are both aspects of the cost optimization which are often performed with the integration of analytics to identify trends
  • The key metrics for the analysis is historical usage data and logs
  • Projected cost reports can help in reducing the present cloud spend

Rightsizing Resources –

  • Rightsizing is the process of recommending the most suitable resource size(generally VMs) so that VM idle times are reduced
  • Idle and underutilized resources need to be identified and right-sized to improve the usage efficiency

Billing Management –

  • Understanding cloud spendings and making sense of the bill is not an easy task
  • A look into how the resources are being utilized—which departments, total use, costs, peaks, etc.—they can really get a feel for what’s happening within the organization, and take more proactive approaches to business strategies