This AWS Reserved Instances FAQ is a culmination of questions we are often asked about using Reserved Instances to save on your Amazon Web Services (AWS) costs.
First, let’s make sure you’re all on the same page. AWS Reserved Instances are a way to save money on your cloud bill by reserving capacity in advance, which you can choose to pay for all, some, or no upfront. Due to the different billing model and variety of options, these often raise questions. Let’s explore a few:
Q1: How do I know which instances are reserved?
Because of how AWS billing works, Reserved Instances aren’t applied until you’re actually being charged for the instances. Think of it more like a “voucher” than a specific virtual machine.
This means that you run your instances as you normally would throughout the month, without seeing which will be billed as reserved vs. on-demand. When your bill comes on the 5th of the next month, AWS will look at your reservations and your usage and automatically apply the reservations that match the instances.
This means that you don’t have to decide which instances are reserved, but it also means you don’t have the visibility into what your true costs are going to be. You’ll have to track this on your own, or use some tools to help you manage your Reserved Instances. AWS has included some reports in the Cost Explorer that can help you visualize your month-to-date usage of your reservations.
Q2: What if I don’t need that instance type anymore?
There’s a couple of options for unused reservations, depending on the reason you aren’t using them anymore. The first option is to sell the reservation on the Reserved Instance Marketplace. This marketplace lets you list your reservation and allows others to purchase it from you. The reservations are grouped together, with the cheapest being sold first in that group. Once someone purchases your reservation, you start getting charged at the on-demand rate (if you still use that type).
The other option is to purchase convertible reservations, which allow you to change the attributes of the reservation (as long as it’s to a more expensive instance type). These convertible types give you much more flexibility, especially as your company or application are growing in use, but they do come with a smaller savings rate over standard Reserved Instances.
Q3: How do Reserved Instances work if I have multiple AWS accounts?
Many users of AWS in large organizations have started using a multi-account strategy, either for security reasons or billing reasons. When managing multiple AWS accounts, billing and reservations can get confusing. The good news is that reservations can “float” across multiple linked accounts, even if they weren’t purchased in the master account. Amazon is smart enough to attempt to apply the reservation to the account it was purchased in, but if a suitable instance is not found, it can apply it to an instance in a different account that matches. You can also choose to exclude linked accounts from receiving these floating reservations if you’d like.
Q4: Are AWS Reserved Instances better than On Demand?
Great question. This is actually the subject of the most popular post on the ParkMyCloud blog. In short: usually yes, but only for production environments. Otherwise, On Demand instances with on/off schedules are typically better value.
Reserved Instances can help save a lot of money on your AWS bill, but require a different way of thinking about your instances than the normal pay-as-you-go that you may be used to with cloud computing. These reservations are typically used for steady-state workloads with consistent usage. They can be complex to manage – be sure to check out our Reserved Instances optimizer to get the maximum value out of your reservations.
We’re happy to announce that ParkMyCloud now supports Alibaba Cloud!
Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP) users have saved millions of dollars on their cloud bills using ParkMyCloud’s automated cloud cost optimization platform. Customers like McDonald’s, Sysco, and Unilever use ParkMyCloud to automatically turn off idle cloud resources as part of their DevOps process.
Now, Alibaba Cloud customers can do the same.
Alibaba Cloud is experiencing rapid customer adoption and growth – in the 4th quarter of last year, they saw over 100% growth, with more than 300 products and features launched. The company is clearly expanding their horizons beyond retail and putting a focus on innovation and development in the cloud space – both in China where their core customer base is located, and throughout the world as companies globally choose Alibaba as their primary cloud provider or as part of a multi-cloud strategy.
But the real reason we’re here is to help cloud users solve the enormous problem of cloud waste.
We estimate that Alibaba users will waste $552 million on idle cloud resources this year – that’s $1.5 million per day that could easily be saved with automated cost optimization in place. There’s no time to lose in getting cost control measures in place.
ParkMyCloud Provides Alibaba Cloud Customers with Continuous Cost Optimization by Turning Off Idle Resources
June 27, 2018 (Dulles, VA) – ParkMyCloud, the leading enterprise platform for continuous cost control in public cloud, announced today that it now provides automated cost optimization and reduction for Alibaba Cloud, the largest public cloud provider in China and a rapidly growing U.S. cloud provider. ParkMyCloud now supports four top cloud providers, with Alibaba joining Amazon Web Services (AWS), Microsoft Azure (Azure), and Google Cloud Platform (GCP).
ParkMyCloud saves money by automatically turning off idle cloud resources, a process it calls “parking”.Customers including McDonald’s, Sysco Foods, and Unilever have integrated cost control into their DevOps processes using ParkMyCloud.
ParkMyCloud estimates that up to $552 million will be wasted on idle Alibaba Cloud resources this year – all of which can be easily saved with ParkMyCloud’s automated optimization and elimination of idle resources.
“ParkMyCloud has had an international customer base from the start, and we look forward to working with companies around the world that choose Alibaba as their primary cloud or as part of their multi-cloud strategy,” said Jay Chapel, ParkMyCloud CEO. “Given their rapid growth – over 100% growth for the 4th quarter, with more than 300 products and features launched – Alibaba is clearly putting a focus on innovation and development in the cloud space. We look forward to helping their customers optimize resource usage as Alibaba Cloud expands internationally.”
ParkMyCloud was founded in 2015 with initial support for AWS. It followed with support for Azure and GCP, while developing capabilities to allow DevOps users to fully automate cloud cost control with innovations such as SmartParking.
ParkMyCloud is a SaaS platform that automatically identifies and eliminates public cloud resource waste, reducing spending by 65% or more — think “Nest for the cloud.” AWS, Azure, Google Cloud, and Alibaba Cloud users such as McDonald’s, Sysco Foods, Unilever, Avid, and Sage Software have used ParkMyCloud to cut their cloud spending by millions of dollars. ParkMyCloud helps companies like these optimize and govern cloud usage by integrating cost control into their DevOps processes. For more information, visit https://www.parkmycloud.com.
Hitachi ID Systems recently reached their first ParkMyCloud birthday – to celebrate, we chatted with Patrick McMaster about how they optimize training infrastructure and why he and his team said “We honestly couldn’t be happier with ParkMyCloud.”
Can you start by telling me about Hitachi ID Systems and what you and your team do within the company?
Hitachi ID Systems makes identity and access management (IAM) software. I am the training coordinator, so I handle getting clients and potential partners up to speed with how our software works, how to install it, how to administrate it, etc. For those who are more interested in learning about software, we set them up with a virtual environment and course materials or an instructor to get them up to speed with how the software works.
Can you describe how you’re using public cloud?
We use AWS exclusively. When we advertise that we’re running a course a few months ahead of time, our infrastructure starts seeing the registrations and will start creating VMs, applying patches, getting the latest version of the appropriate software installers on the desktop and getting everything ready for the students, who will be accessing geographically-local AWS infrastructure.
In the past, everything for this online training was very manual. We on the training team would spin up the VMs manually, do the updates manually, and send the information to the potential students., Then when the course was over we would go through and do the reverse – shutting the elements down and turning off the virtual machine on AWS.
What does the supporting training infrastructure in AWS look like?
We have a number of VMs running per student or team that only need to be active during the team’s local business hours, plus some additional supporting infrastructure which is required 24/7. We started to realize as we got more students and began offering self-paced training that our AWS fees were increasing from the 24/7 access we were providing, but also just the management of keeping track of which students are where, when they should be brought into the system, when they should be shut down, etc. We needed to find a solution pretty quickly as we experienced that period of rapid growth.
How did that lead you to finding ParkMyCloud?
We knew we needed to automate the manual processes for this. Of course, lots of organizations tend to come up with solutions internally first. We’re a software company, so we had the talent for that, but we never have enough time. I’ve come to terms more and more every year with the benefits of delegating to the other sources. I realized that we are probably not the first organization to have this problem, so I Googled and found ParkMyCloud.
It became quickly evident that the features that you offered were exactly what we were looking for.
Can you describe your experience as a ParkMyCloud user so far?
Sure! So just before our demo of ParkMyCloud, we were fighting with this issue of trying to figure out how we can manage multiple time zones and multiple geographic locations, and not pay for that time that VMs are just spun up.
Then we went through the ParkMyCloud demo process and started our trial. We connected to our system and looked at ways to set up different schedules and pull information from AWS. There was definitely a moment where everyone in the room looked each other and said, “we must be missing something” – there had to be some additional steps we hadn’t thought out because it seemed too easy to work. But it really was that easy.
It just took a week of monitoring to make sure everything was turning off when it was supposed to – the bulk of our effort was really in that first week, and the time we need to spend in the interface is so small. We can go into ParkMyCloud’s dashboard and make exceptions to the schedule when needed, but the time that we actually spend thinking about these things is now about 2 hours a week, whereas before it was something that members of our staff might struggle with for 1-2 days. It’s been a huge improvement.
We did some calculations just in terms of uptime versus what we were doing before, and having the different schedules at our disposal and being able to spend that one week coming up with every scenario we could come up with was time well-spent. Now there are very few exceptions. I don’t think we’ve had to create a new schedule in a long time. Everything is organized logically, it’s very easy for us to find everything we need.
Who is responsible for tracking your AWS spending in the organization? Have they had any feedback?
Our finance department. Since we started using ParkMyCloud, it’s been very very quiet. No news is good news from finance. We are saving about 40% of our bill.
Do you have any other cloud cost savings measures in place?
Not for this training infrastructure. We have a pretty unique use case here. Our next steps are going to be more towards automatic termination, automatic spinning things up, more time-saving measures rather than cost.
This summer ParkMyCloud is working on instance rightsizing, if that’s something that would be helpful for you.
That’s definitely something that we could use. We are always trying to find better ways of doing things.
We recently discussed how orphaned volumes and snapshots contribute to cloud waste and what you can do about it, but those are just two examples of orphaned cloud resources that result in unnecessary charges. The public cloud is a pay-as-you-go utility, requiring full visibility of specific infrastructure – you don’t want to be charged for resources you aren’t using. Here are other types of orphaned cloud resources that contribute to cloud waste (and cost you money):
Unassociated Elastic IPs
Elastic IPs are reserved public IP addresses designed for dynamic cloud computing in AWS. As a static IPv4 address associated with your AWS account, Elastic IPs can continue running an EC2 instance, even if it is stopped and restarted, by quickly remapping the address to another one of your instances. You can allocate an Elastic IP address to any EC2 instance in a given region, until you decide to release it.
The advantage of having an Elastic IP (EIP) is the ability to mask the failure of an EC2 instance, but if you do not associate the address to your account – you’re still getting charged. To avoid incurring a needless hourly charge from AWS, remember to release any unassociated IPs you no longer need.
Elastic Load Balancers (with no instances)
Cloud load balancing allows users to distribute workloads and traffic with the benefit of the cloud’s scalability. All major cloud providers offer some type of load balancing – AWS users can balance workloads and distribute traffic among EC2 instances with its Elastic Load Balancer, Google Cloud can distribute traffic between VM instances with Google Cloud Load Balancing, and Azure’s Load Balancer distributes traffic across multiple data centers.
An AWS Elastic Load Balancer (ELB) will incur charges to your bill as long as it’s configured with your account. Like with Elastic IPs, whether you’re using it or not – you’re paying. If you have no instances associated with your ELB, delete to avoid paying needless charges on your monthly bill.
Unused Machine Images (AMIs)
A Machine Image provides the information required to launch an instance, which is a virtual server in the cloud. In AWS they’re called AMIs, in Azure they’re Managed Images, and in Google Cloud Platform they’re Custom Images.
As part of your measures to reduce unnecessary costs from orphaned volumes, delete unused machine images when you no longer need them. Unless deleted, the snapshot that was created when the image was first created will continue to incur storage costs.
One of the growing pains that organizations face is the management of isolated pools of data in their cloud environment. Fragmented storage can result from data coming from a number of sources used by applications and business processes. Object Storage was designed to break down silos into scalable, cost-effective storage to store data in its native format. AWS offers object storage solutions like Amazon S3 and Amazon Glacier, Google has Google Cloud Storage, and Azure calls its solution Azure Blob Storage. All options help you manage your storage in one place, keeping your data organized and your business more cost effective.
Although object storage in and of itself is a cost effective solution, there are still ways to optimize and reduce costs within this solution. Delete files you no longer need so that you’re not paying for them. Delete unused files which can be recreated. In S3, use the “lifecycle” feature to delete or overwrite older versions of data. Clean up incomplete uploads that were interrupted, resulting in partial objects that are taking up needless space. And compress your data before storing to give you better performance and reduce your storage requirements.
How to Avoid Wasted Spend on Orphaned Cloud Resources
Don’t let forgotten resources waste money on your cloud bill. Put a stop to cloud waste by eliminating orphaned cloud resources and inactive storage, saving space, time, and money in the process. Remember to:
Release unassociated IPs you no longer need.
Remove Elastic Load Balancers with no instances attached.
Delete unused machine images when you no longer need them.
Keep object storage minimal – optimize by “cleaning up” regularly, removing files you don’t need.
The premise of the cloud and the resources available to you were meant to be cost effective, but it’s up to you keep costs in check. Optimize your cloud spend with visibility, management, and cost automation tools like ParkMyCloud to get the most out of your cloud environment.