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 have been talking about idle cloud resources for several years now. Typically, we’re talking about instances purchased On Demand that you’re using for non-production purposes like development, testing, QA, staging, etc. These resources can be “parked” when they’re not being used, such as on nights and weekend, saving 65% or more per resource each month. What we haven’t talked much about is how the problem of idle cloud resources extends beyond just your typical virtual machine.
Why Idle Cloud Resources are a Problem
If you think about it, the problem is pretty straightforward: if a resource is idle, you’re paying your cloud provider for something you’re not actually using. This adds up.
Most non-production resources can be parked about 65% of the time, that is, parked 12 hours per day and all day on weekends (this is confirmed by looking at the resources parked in ParkMyCloud – they’re scheduled to be off just under 65% of the time.) We see that our customers are paying their cloud providers an average list price of $220 per month for their instances. If you’re currently paying $220 per month for an instance and leaving it running all the time, that means you’re wasting $143 per instance per month.
Maybe that doesn’t sound like much. But if that’s the case for 10 instances, you’re wasting $1,430 per month. One hundred instances? You’re up to a bill of $14,300 for time you’re not using. And that’s just a simple micro example. At a macro level that’s literally billions of dollars in wasted cloud spend.
4 Types of Idle Cloud Resources
So what kinds of resources are typically left idle, consuming your budget? Let’s dig into that, looking at the big three cloud providers — Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP).
On Demand Instances/VMs – this is the core of the conversation, and what we’ve addressed above. On demand resources – and their associated scale groups – are frequently left running when they’re not being used, especially those used for non-production purposes.
Relational Databases – there’s no doubt that databases are frequently left running when not needed as well, in similar circumstances to the On Demand resources. The problem is whether you can park them to cut back on wasted spend. AWS allows you to park certain types of its RDS service, however, you can not park like idle database services in Azure (SQL Database) or GCP (SQL). In this case, you should review your database infrastructure regularly and terminate anything unnecessary – or change to a smaller size if possible.
Load Balancers – AWS Elastic Load Balancers (ELB) cannot be stopped (or parked), so to avoid getting billed for the time you need to remove it. The same can be said for Azure Load Balancer and GCP Load Balancers. Alerts can be set up in Cloudwatch/Azure Metrics/Google Stackdriver when you have a load balancer with no instances, so be sure to make use of those alerts.
Containers – optimizing container use is a project of its own, but there’s no doubt that container services can be a source of waste. In fact, we are evaluating the ability for ParkMyCloud to park container services including ECS and EKS from AWS, ACS and AKS from Azure, and GKE from GCP, and the ability to prune and park the underlying hosts. In the meantime, you’ll want to regularly review the usage of your containers and the utilization of the infrastructure, especially in non-production environments.
Cloud waste is a billion-dollar problem facing businesses today. Make sure you’re turning off idle cloud resources in your environment, by parking those that can be stopped and eliminating those that can’t, to do your part in optimizing cloud spend.