Multi-Cloud Economics by Cloudyn Feb 2014

Multi-cloud Economics

February 26, 2014IGT Cloud Workshop

Vittaly Tavor – VP Products,Cloudyn

Agenda

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

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

Worldwide spending on servers (IDC, 2012)

Effects of server aging (IDC, 2012)

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

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:

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

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)

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%

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

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

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

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!

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

Smile

Thank [email protected]