Understanding the Basics of the AWS Cost Calculator: A Guide for Cloud Resource Planning

Tyler Au
6 minutes
May 4th, 2023
Tyler Au
6 minutes
May 4th, 2023

The AWS Cost Calculator: Amazon’s Price Simulator

Think about the last time you saved up to buy something; whether it was a car, a down payment for a house, or even a pair of shoes, having an accurate and updated budget is key. With prices for seemingly everything skyrocketing these days, it’s absolutely essential to know how much you’re spending, and know where to cut costs. This applies to your cloud spend, too.

Amazon Web Services (AWS) is one of the biggest clouds and cloud providers in the industry, leading the charge for over 1 million active users. AWS offers over 200 services, each at different price points, with different models and tiers that users can experiment with to get the most bang from their buck. But did you know that AWS actually has an in-house cost calculator that simulates service usage?

The AWS Cost Calculator is a web tool hosted by AWS to help users create price estimates that vary from service chosen to actual use cases. Intended for use by everyone but geared towards AWS beginners and those already in AWS but that want to reorganize their spending, the pricing calculator excels in solution modeling and accurate price estimates. At AWS, costs are calculated on 3 main components: compute costs, storage costs, and outbound data transfer costs, with these costs varying based on the service and chosen pricing model. 

Users of this pricing calculator can expect the following benefits and features:

  • Transparent pricing - no hidden pricing behind service configurations
  • Estimates sharing - revisit-able linking and backups on AWS servers
  • Hierarchical estimates -  estimates sorting based on service architecture
  • Estimates exporting - easy PDF or CSV conversion for sharing

Whether it’s for short usage or to support long term company growth, the AWS cost calculator is a titan for anyone looking to optimize their cloud spend.

The Pricing Models of AWS

Although the cost calculator offers a precise simulation and estimation of AWS service prices, those estimates may vary depending on the pricing model chosen. Here are some AWS pricing models to consider before jumping in:

On-Demand

The On-Demand model lets you pay for compute or database capacity on what you actually use by the hour. Depending on the instance type chosen and what instances are run in general, you may not have to opt into a long term commitment or upfront payments.

Savings Plan

Savings plans are models that offer lower pricing than On-Demand plans, but at the expense of usage commitments from 1-3 years. There are two types of savings plans to choose from:

  • Compute Savings Plans are the most flexible and can reduce costs up to 66%, applying to in-demand services like Amazon EC2 and AWS Lambda.
  • EC2 Instance Savings Plans offering insane savings (up to 72%), while requiring a usage commitment.

Dedicated Host Plans

Dedicated host plans require participants to pay for dedicated hosts, without considering instance size and quantity. With pricing varying by instance family, region, and payment options, dedicated host plans can possibly save you up to 70%.

Reservations

With reservations, users can reserve instances based in the region and zone they’re hosted in. This plan is advantageous for price locking, as your price during reservation becomes secure for 1-3 years.

To learn more about each of these plans, visit https://docs.aws.amazon.com/prescriptive-guidance/latest/strategy-sap-cost-optimization/pricing-models.html#savings-plans 

Usage Considerations

Like any simulation, there are many elements to consider when comparing the price of service generated by the AWS cost calculator- here are just a few:

Actual Usage

Have you heard of the phrase, “if you're going to talk the talk, you've got to walk the walk”? This saying draws the line between what you SAY you’re going to do and what you’re ACTUALLY going to do, with this concept applying to the AWS Cost Calculator. Many times, users become disgruntled when their costs become too high, only to find out that their usage surpassed the one simulated on the calculator. Knowing that actual pricing varies based on actual usage is something to consider before committing to a certain service based on simulated pricing.

For example, at the time of using the calculator, you might have accounted for a lower amount of EC2 instances than you have actually used. Instead of taking your intended and simulated usage, AWS will calculate costs based on your actual instance usage.

This case also applies to regions; prices will vary based on regions selected.

Taxes

Although the AWS Cost Calculator preaches transparency in its simulations, one thing it does not account for is taxes that are applied upon service purchase. 

Pricing Changes

For the most part, AWS pricing models are second to none, with the pay-as-you-go pricing model being one of the most popular offered by the tech giant. However, in comparison to when you used the cost calculator, the prices of services might change over time. For a selection of services, you’ll actually be able to combat this sudden price change by buying a 1-3 year reservation to lock in the price you paid during the time of the reservation. 

To learn about all the considerations, please visit https://aws.amazon.com/calculator/calculator-assumptions/

Using the AWS Cost Calculator Requires Precise Information

The AWS Cost Calculator requires a bit of information to determine accurate pricing, mainly because it tries to simulate actual use-case pricing. The AWS calculator, as well as other AWS TCO tools, require basic information like region, location type, and desired service. Specificity quickly becomes a factor once you have chosen your service, for example, AWS data transfer simulations require the outbound and inbound transfer amounts, data weight, and even where the data is coming from. 

Despite some logistical knowledge needed to leverage this calculator to its fullest potential, the AWS cost calculator creates a price summary during the session you’re in, congregating all of your saved calculations onto a single page. With a breakdown of upfront and monthly costs, the AWS cost calculator is a must for anyone looking to get started with AWS.

For more information on how to use the AWS cost calculator, please visit https://calculator.aws/#/ 

Image courtesy of Amazon AWS

Cloud Spend, the Lyrid Way

The AWS Cost Calculator provides users a way to see how their budgets and spending might be impacted by a drastic change in services. Letting users chart their expenses by requiring information such as region and even instance amounts is the best way for AWS to gauge exactly how much a user would spend in a certain scenario, but what if there was a surefire way to save money?

Enter Lyrid.

Lyrid is the cost-saving cloud and Kubernetes platform that can rival even the big dogs of the industry. Using Lyrid’s Kubernetes solutions, you’ll be able to reap the benefits of AWS, without the high costs and need to calculate. Companies and organizations like Aido Health and the Bekasi County have used Lyrid to streamline their development processes AND significantly cut their cloud spending costs.

Want to learn more? Book a demo with us here!

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