BTEX 2023: Saving in the Cloud: Cost Optimization and Management Techniques

Many companies are facing limited budgets. Optimizing costs without compromising results might sound impossible, but it is not. Nicholas Rai, Principal Field Solution Architect at CDW Canada, took the Glass Room stage at BTEX 2023 to offer a list of techniques organizations can implement to reduce cloud costs.

Choose the right cloud service provider and pricing model

Rai started by highlighting the importance of understanding the available pricing model options and the value of having some guidance for picking the right one. “In any public cloud, you want to make sure that they have various pricing models. Working with an MSP (Managed Services Provider) such as CDW helps. We have various advantages, and you can pay only for what you use.”

Use automation tools

Rai continued to encourage the audience to exploit the potential of automation tools. “When leveraging automation tools, I would say the sky is the limit. We have a lot of clouds up here right now, but you have the ability to expand and burst based on demand. We've worked with a lot of colleges and retail stores during peak season: registration for college, Boxing Day, etc. Looking at the demand, these are areas where we could help our customers scale based on compute resources and demand from that front.”

Monitor and analyze your cloud usage

Getting a better understanding of an organization’s cloud needs can also help detect saving opportunities. There are cloud-native tools that help analyze cloud usage to answer some key questions. In Rai’s words: “You always want to monitor and analyze your cloud usage. For any public cloud, there are cloud-native tools that you could leverage and that would allow you to understand questions such as, ‘Where's my span?’ or ‘Where's my trajectory?’”

Use reserved instances or spot instances

Rai also encouraged reserving resources in advance. “You may have a domain controller or a pair of next-generation firewalls that are running 24x7. By leveraging reserved instances, you could commit to a one-year or three-year instance on these and you could save up to around 45 percent. If a compute instance is, say, $500 a month, you will probably pay only $250 or $300 a month.”

“Spot instance is another option worth considering,” said Rai. “Spot instance is when AWS and Microsoft say, ‘Hey, I have a whole bunch of dormant virtual machines, so you can grab them and just pay and use them whenever you can.’ It's ideal for batch processing, for example. It all depends on your use case.”

Optimize your storage

“Storage could be replicated in one data centre to another region or even across the globe. Trying to understand the various workloads and how that storage is being utilized is key,” said Rai. “A lot of customers say, ‘Hey, let me archive our S3 Glacier, which is technically a tape library in the cloud.’ Yes, it's cheap to store 200 terabytes. But if you're to restore those 200 terabytes, that definitely will cost you.”

When working on a cost-saving cloud strategy for his customers, optimizing storage is key, explained Rai. “We try to understand what our customers need. We work with them to figure out where they can store that data and what type of data it is.”

Implement resource tagging

Resource tagging is another technique that can help identify who is responsible for what resources and keep control of costs. In Rai’s words: “Obviously, you want to touch on this (resource tagging). It depends on how large your organization is when it comes to the cloud or even your IT spending. You may want to tag those resources to understand who is responsible for what. So at least you have one neck to choke and say, ‘Hey, why are you running a $2,000-a-month virtual machine?’”

Optimize networking costs

Networking plays a significant role when it comes to cloud savings. Rai explained how he helped some customers find balance in their networking: "We've helped a lot of our customers from a global perspective and also at a regional level when it comes to networking: How can you define a network? What does that SD-WAN infrastructure look like? What type of express route or direct link are we talking about? How does a user connect to your various services? We can help our customers understand how they connect to the cloud and what type of applications can leverage that network connectivity."

Continuously review and optimize

Lastly, Rai explained that saving costs in the long term comes by constantly asking the right questions: “You always want to review your cloud. You want to understand how things are going. Am I doing a good job? Do I have my tagging enabled? Is my networking optimized? Do I have the appropriate resources?”