News When considering cloud cost optimization, don’t just think about reasonable adjustments

How can you optimize your cloud spending bill?

The usual answer is to reduce cloud costs on a workload-by-workload basis. For example, cloud administrators are advised to “size down” virtual machine instances or take advantage of discounted prices for individual VMs.

These strategies are sure to save you some money on your cloud bill. But they cannot provide all possible cost savings. To achieve true cost optimization in the cloud, you need to think ahead. That’s why.

related: 5 myths about cloud pricing

General Best Practices for Cloud Cost Optimization

Traditional approaches to cost optimization typically take the form of the following practices:

  • streamline: Thin means choosing the best cloud hosting configuration based on the requirements of each workload. The goal is to avoid paying for resources that your workload doesn’t actually need.
  • Take advantage of pricing discounts: Cloud providers offer discounted prices for some of their services if users accept certain caveats.For example, you can save money on cloud storage by Using Amazon S3’s Glacier storage classwhich is less expensive but also less responsive than more expensive storage tiers.
  • To track workload: By tracking what you’re running in the cloud, you can find workloads or resources that are still running but shouldn’t be.

By minimizing waste and increasing cost efficiency, these practices can help you reduce costs for the specific cloud workloads that benefit from them.

An Aggressive Approach to Cloud Cost Optimization

On their own, however, traditional cloud cost optimization strategies provide limited value. The main reason is that they only benefit specific workloads, rather than providing savings that can be applied across clouds — or at least across all workloads of a specific type.

related: 6 Tips for Controlling Cloud Costs in a Recession

For example, right-sizing individual VM instances will only save you the cost of those instances. Moving some data to a lower-cost, lower-performance storage tier doesn’t save you money on data that you have to keep in a more expensive tier.

That’s why the key to real cost savings is to be more aggressive in cloud cost optimization by leveraging the following strategies:

  • Go cloudy: Adopt a multi-cloud architecture Cloud spend can be reduced across the board by leveraging cloud services that cost less than when using a single cloud. For example, maybe one cloud provider has lower-cost VM hosting, while another offers lower-cost object storage. By using two clouds together — one for VMs and one for storage — you can save money on all workloads in these categories.
  • Enterprise Agreement: If you’re a large enterprise, you can save a lot of money by negotiating an enterprise agreement with your cloud provider (or providers). The Enterprise Agreement provides comprehensive pricing discounts for customers who use cloud services in large quantities. They’re another great way to trim your overall spending.
  • Cloud Startup Credits: Small businesses can also reduce cloud costs by claiming startup credits from cloud providers. Startup credits provide free or discounted access to cloud services. They’re meant to give small companies new to the cloud a temporary boost, but startups can negotiate extended startup credits.

In addition to the fact that these strategies can reduce cloud spending across your environment, they also have the advantage of being relatively simple to implement. Things like right-sizing VM instances are a lot of work compared to the money they save you. In contrast, strategies like earning startup credit are relatively simple to implement. You don’t need any special technical tools or skills. You just need to ask your cloud provider to access their initiator.

Conclusion: Think Big and Save Time and Money

Optimizing cloud spending on a workload-by-workload basis is not a bad thing. In fact, it’s necessary if you want to keep your cloud bills as low as possible.

But in many cases, the greatest cloud savings opportunities go beyond strategies like right-sizing or pricing discounts for individual workloads. Enterprises need to think bigger and leverage practices that allow them to cut spending on all cloud workloads while investing less time and technical effort than traditional cloud cost optimization approaches.

about the author

Christopher Tozzi is a technology analyst with expertise in cloud computing, application development, open source software, virtualization, containers, and more. He also lectures at a major university in the Albany, New York area. His book “For Fun and Profit: A History of the Free and Open Source Software Revolution” is published by MIT Press.

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