Author: Ozzy Brightrose

google cloud cost calculator

Understanding the Google cloud cost calculator

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Google cloud cost calculator

If you are thinking of moving to the cloud, then it’s important to have a clear overview of cloud pricing.  You can work this out manually, if that’s your preference, or if you’re thinking of going with a smaller cloud provider which doesn’t offer pricing tools.  The big vendors, however, like Google Cloud and Microsoft Azure, will all offer their own cloud cost calculators.  Here is what you need to know about the Google cloud cost calculator.

The Google cloud cost calculator only estimates the cost of usage.

At the current time, the Google cloud cost calculator cannot help you to estimate the cost of the actual cloud migration.  Maybe this is something Google will work on in the future, but there are a huge number of factors involved, so it would be a very complicated undertaking for them.  The key point to take away is that you will only be able to calculate usage costs.

The Google cloud cost calculator only provides estimates.

This may seem like stating the obvious, but it’s an important point.  You can expect the Google cloud cost calculator to give you a reasonable estimate of what you are likely to pay.  It is not, however, a fixed and binding agreement.  This means that you may pay more (and you may also pay less).  It’s also worth noting that cloud vendors can change the fees they charge at any time.  They will, however, typically provide plenty of notice of this, so you can move to another cloud vendor if you wish.

On this point Google Cloud (currently) has no termination fees, so you are not “locked-in” financially.  You would still have the costs of moving to another provider, however these might well be (significantly) lower than the costs of your initial cloud migration.  The reason for this is that your initial cloud migration would probably include a process of “figuring it all out”.  If you have kept on top of your cloud usage, you should not need to go through that process all over again.

The Google cloud cost calculator has 47 pricing categories.

At the present time the Google cloud cost calculator has 47 pricing categories (plus a free category).  If this sounds overwhelming, that’s understandable.  The fact is that many of them are going to be absolutely irrelevant to the average SMB.  Many SMBs will find everything they need right on the front page of the options list, which includes the Compute Engine (virtual machines), App Engine (serverless application platform for apps and backends), Cloud Storage and Networking options.

Estimates are (usually) per month but pricing is per second

When you use the Google cloud cost calculator, you will typically enter your estimated monthly usage.  Occasionally, you will use another date range, such as per day, but generally it’s per month.  When you actually use Google Cloud for real, you will be billed per second.  This difference can make a major difference to your billing – unless you have a robust cloud strategy in place.

The key point to note is that you will (presumably) base your estimated usage on what you have worked out you need (plus what you want).  In the real world, however, it’s very easy for people to slip into bad habits, such as leaving instances running even though they are not needed or forgetting to detach storage before ending an instance.  This is the equivalent of leaving the lights on in an empty room and can waste a lot of money.  The way to prevent this is to automate as much as possible and to have solid processes in place for tasks which have to be managed by humans.

All costs on Google only apply after your free trial has been used up.

Google offers a completely free trial upon sign up.  You do have to give payment details, but it appears this is just to stop people abusing the system.  Nothing will be charged to your card without your prior agreement.  If, for whatever reason, you use up your free trial and decide to do nothing more, that’s it.  You will not be charged.  In fact, you can even go on and use Google’s “free tier”, (more on that later). 

At the current time, you get $300 worth of credit to use within 12 months.  Your trial ends when either your credit is used up or the 12 months are over.  For many businesses, especially SMBs, this really is a great option for “road-testing” services.

All costs on Google only apply to anything outside the “free tier”.

The free tier on Google cloud is exactly what it sounds like. Basically, it’s a very minimal allowance across a range of services.  It’s probably enough for solopreneurs, e.g. freelance developers, but it’s highly unlikely to be enough for even the smallest of SMBs.  It is, however, better than nothing and you get to use it up before you start paying for anything.

cloud cost estimator

3 things you need to remember to create an accurate cloud migration cost estimate

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Cloud migration cost estimate

Moving to the cloud usually brings significant benefits to companies, especially SMBs. For many companies, one of the most important benefits of the cloud is its simplicity.

Indeed, using the cloud is generally a whole lot easier than running in-house data centers. It is, however, also true that cloud migrations have to be managed carefully.

In particular, it’s important to create accurate estimates of cloud costs. Here are three points you need to remember to make that happen.

Everything starts with a full and accurate overview of your current IT costs

Full means that you need to assess both direct costs and indirect costs.

The former should be easy to find. You just need to go through your finances and look for any costs which relate to your infrastructure, applications and network.

This includes extraordinary costs, for example, if you had to pay for consultants to help your in-house IT team. It’s fine to label these as extraordinary costs, but they still need to be included.

Indirect costs may be harder to calculate, but it’s really important to do your best.

Think through all the activities related to your IT infrastructure and see if any of them have generated costs that haven’t been listed already.

Recruitment and retention of staff usually come up here. Then think about any outages you have experienced and how much they have cost you.

Then think of any opportunities you have missed and what they have cost you. Ideally, you’ll want three to five years’ worth of figures.

This will give you your foundation for looking at what you are going to need from the cloud and hence how much it is likely to cost you.

Cloud cost calculators are only as good as the data you enter into them.

If you’re looking at the big providers (like Amazon Web Services and Microsoft Azure) then they’ll have their cost calculator. You can also calculate cloud pricing the manual way.

You may want to do both as a cross-check. The key point to remember, however, is that any calculation is only as accurate as its data.

You should already have most of the data you need. However, there are still two major points to cover.

First of all, you absolutely must get accurate data on real-world usage patterns. You then need to supplement this with any information you have on what is likely to happen in the future.

Cloud costs are based on usage, so you can only estimate them accurately if you know what resources you will need.

Secondly, remember to consider whether or not you’re still going to need an in-house IT headcount to support your users and, if so, to budget funds for it.

The cloud migration itself will carry a cost.

All cloud migrations will carry a cost. How much they will cost will depend on several factors. In many cases, however, it’s very worthwhile to spend extra money on the migration to save money further down the line.

To understand why this is, you need to understand the realities of cloud migrations.

At a very basic level, most organizations could probably just do a “lift and shift” cloud migration. In other words, they could just take everything they currently have and mirror it in the cloud. This is the simplest approach and hence generally the cheapest (in the short term).

Even here, however, you will have to factor in the cost of creating a full inventory and mapping all dependencies.

If you already have an inventory and all dependencies mapped, then make sure it is completely up-to-date and 100% accurate.

If it’s not, you could find yourself dealing with a whole lot of problems you could easily have avoided and these problems will usually lead to additional costs.

In many cases, however, the “lift and shift” approach will end up costing more money than it saves “over the long term”.

The reason for this is that in many companies, IT systems are updated on a combination of need, want and judgment rather than planned mindfully.

This is often true even with larger companies and is especially true with SMBs. Moving to the cloud provides a great opportunity to review what you have and compare it with what you really need and want.

Getting this right may involve enlisting the help of external consultants and if so you will need to budget for the cost.

You may also need to revise your security arrangements to reflect the fact that you will be in a cloud environment. Again, there will probably be a cost for this.

In addition to deciding what needs to be done, you will need to put together a project plan to do it and the hallmark of a good project plan is that it has realistic timescales for each step.

Getting this right will go a long way to keeping your cloud migration costs on the expected track.

See Also

EC2 Instance Types

cloud-cost-management

What Cloud Cost Management Actually Means?

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What is Cloud Cost Management

Cloud Cost Management is Not Just About Switching the Platform

Switching to cloud services is often at least as much about cost management as it is about the flexibility offered by cloud infrastructure.

There are indeed many cost savings to be made by switching to a cloud platform. It is, however, also true that companies, especially SMBs may not really understand what this actually means in practice.

Cloud computing is basically about swapping capital expenditure for operating costs

Let’s create an analogy. If you buy a house, you have to spend a whole lot of money buying the house. Then, you have the responsibility of repairing, maintaining, decorating and furnishing the house.

Everything that needs to be done to the house comes out of your pocket. Now, let’s say you rent, you don’t have to find an upfront payment, just your monthly rent.

Likewise, anything to do with managing the house is your landlord’s problem not yours. This is basically the situation with swapping in-house data centers for cloud computing.

Of course, the analogy isn’t perfect, far from it. If you buy a house, you build up equity in it, which is a benefit. You can also expect it to increase in value over the long term.

Mainstream IT equipment, by contrast, almost invariably depreciates in value, often very steeply. It also requires a whole lot more maintenance than the average house.

The general point, however, is still valid. Moving to cloud services is not necessarily cheaper, but it is often a whole lot more cost-effective than running in-house data centers.

Three reasons why cloud platforms can be more expensive than you think

There are three main reasons why moving to cloud computing can work out more expensive than you think it should.

The first is, quite simply, that you don’t understand your usage patterns. This is vital to cost-effectively managing cloud services.

The second is that you waste your resources. In a data center, it doesn’t really matter all that much if you leave devices idling.

Yes, you use electricity, but you might use even more to power them down only to power them back up again.

In the cloud, there is a direct link between cost and usage. If you leave an instance “idling” when you don’t need it, then you are wasting money.

Similarly, if you fail to detach storage when you close an instance, you are wasting money.

Basically, you need effective cloud governance to ensure you only use what you need and do not waste the cloud resources for which you are paying.

The third is that cloud vendors will try to upsell services. Just remember, no matter how great a discount you’re getting, it only has value if you actually really need the cloud service or really want the cloud service.

You may get some good deals through upselling offers but resist the temptation to buy cloud services just because they’re at a discount.

Three unexpected ways the cloud could save you money

There are three indirect ways, the cloud could actually save you money and could work out cheaper than running your own in-house data center.

Firstly, you can get rid of any hardware you have on-site. You can then reassess your office space and may be able to put it to more productive use.

Even if you can’t, you should certainly let your insurance company know that the equipment is now gone. It may lower your premium. As a minimum, keep it in mind when you go to renew your policy.

Secondly, you no longer need to try to recruit and retain IT staff. For SMBs, this can be a huge benefit. There is a massive skills shortage in IT, especially in IT security.

This means that experienced IT professionals know they can command salaries way beyond anything the average SMB could afford.

Additionally, working for larger companies generally offers more opportunities for personal and professional development and in a fast-moving sector like IT, that can count for a lot.

Thirdly, switching to cloud services facilitates remote working.

As a minimum, this offers an obvious disaster-recovery strategy. In business terms, a “disaster” does not have to be something that makes headline news across the world. It just has to be something that disrupts your access to your habitual place of business.

Remote working can, however, serve all kinds of useful purposes. For example, it can be used to help staff manage their work/life balance.

This can be very useful for retaining them. It can also be used to address a lack of office space and/or a lack of local staff with the necessary skills.

The ability to onboard remote workers can also make it vastly easier to bring in freelancers for short periods, whether that’s a few hours a week long-term or when you need help in peak seasons.

See Also

Cloud Pricing

cloud cost models

What cloud cost models actually mean for you

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Cloud cost models

When you adopt cloud computing you basically switch capital expenditure for a service-based pricing model.

Getting the best deal means getting the cost model which is right for you. With that in mind, here is a guide to what cloud cost models actually mean in practice.

Service-based pricing models.

These days this is probably the most common approach to billing for cloud computing. A cloud vendor will offer a range of cloud services and companies will decide what they need.

They can then pay on a subscription or pay according to use. Many times, companies will use a mixture of both cost models.

When does subscription-based pricing make sense?

Subscription-based pricing models make sense when you can predict usage fairly accurately. Accuracy is very important. If your budget for too little, you will wind up paying per use anyway.

If your budget for too much, you will spend more than necessary. In fact, you might end up spending more than you would have on straightforward pay-per-use. Get it right, however, and you can make very respectable savings.

Subscription-based pricing models also make sense when you want to “lock in” a price. In other words, they protect you from price increases on the vendor side.

Admittedly, they also stop you from taking advantage of price reductions. This is probably less of a risk. Vendors will typically keep their subscription prices lower than their pay-per-use prices.

It’s in their interests to do so. This means that if pay-per-use prices dropped, your vendor might agree to reduce your subscription cost (or increase what they gave in return).

One way to use subscription-based pricing models is to use them for your baseline. In other words, use them for what you know you’re going to need throughout the year.

Then you can top them up with pay-per-use cost models. In fact, many cloud vendors operate “hybrid cost models” in which you start on subscription and then move automatically to pay-per-use if you exceed your subscription allowance.

This can be very convenient, just remember to check how it stacks up against the costs of switching manually to pay-per-use.

When does pay-per-use pricing make sense?

Pay-per-use pricing models make sense for companies that want or need maximum flexibility. They can actually work out more affordable than you might expect.

The trick to making pay-per-use pricing models work effectively is to use reserved instances and/or spot instances. Generally, you want to use a combination of both

Reserved instances

Both Amazon Web Services and Microsoft Azure make it possible to pre-pay for usage packages. In AWS these are called Reserved Instances. In Microsoft Azure, they are called Reserved VM Instances. Most of the time both versions are generally known as RIs.

The key point to take away is that they offer volume discounts without the need to commit to a subscription. RIs can be valid for anything between one and three years. This is ample time for most companies.

Spot instances are basically the exact opposite. They are essentially short-notice, short-term discounts.

Cloud vendors use them to manage their capacity. SMBs can use them to reduce costs. This may require some flexibility on their part, but the savings can be more than worth it.

That said, flexibility cuts both ways. You have no obligation to use the cloud vendor’s services.

The cloud vendor has no obligation to keep their prices at the same level. In practical terms, this is a minor risk.

There is a decent level of competition between cloud vendors. This helps to keep prices in check. It is, however, a possibility and needs to be recognized as such.

User-based pricing models.

User-based cost models are exactly what they sound like. They can also work on a subscription basis or on a pay-as-you-use basis.

The big difference is that you are unlikely to get either RIs or spot instances.

User-based pricing models can work really well for smaller companies. They can blend the stability of subscription-based cost models with the flexibility to scale up and down as required.

User-based pricing models typically work best when companies have limited core staff.

They may, however, add extra staff at peak times. They may also work with freelancers who need access to their systems.

These cost models do typically need to be watched particularly carefully. There tends to come a time when they become financially inefficient. That said, some companies may still prefer to stick with them for their simplicity.

In short

The very smallest SMBs could find that user-based cost models are the most sensible way to go. You eliminate your capital expenditure and replace it with predictable monthly billing.

Larger SMBs are probably going to want to look at service-based pricing models. Subscription-based cost models provide long-term stability. Pay-per-use models offer maximum flexibility.

They can also be very cost-effective if you use RIs and spot instances.

See Also

how cloud cost management works

Amazon Workspaces

cloud computing cost savings

How the cloud really can save you money

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How the cloud really can save you money

There’s an old saying in business that you have to spend money to make money.  Although there’s a lot of truth in it, there are some exceptions to every rule.  For example, when you move to the cloud, you actually save money on capital expenses.  Then you only pay for what you actually use.  This can really trim back your operating costs.  What’s more, one of the many benefits of the cloud is its many possibilities for indirect cost savings.

Moving to the cloud eliminates the need for capital expenditure.

Cash flow is king in business.  This is particularly true of SMEs.  Large expenses can really hurt a company’s cash flow.  They mean businesses either have to set aside a chunk of their income or use financing.  The former means they can’t use that money for something else.  The latter carries financing costs.  For finance departments, this in itself is probably a justification for moving to the cloud.

With cloud platforms you only pay for what you actually use.

When you run your own data centers, you have to allow spare capacity.  This is just a fact of life.  It’s way too complicated (and hence risky) to start swapping hardware in and out to cope with changes in demand.  From a financial perspective, there are two big problems with this.  One is probably fairly obvious and the other one less so.

The obvious problem is the one mentioned above.  The less obvious problem is that leaving computers “idling” until they are needed generates further costs.  Even though the power requirements may be minimal, these minimal costs add up.  In fact, over time, they can build up into substantial costs.

With cloud computing, your cloud vendor takes care of everything.

Right now there is a major shortage of skilled IT staff.  There is a particular shortage of staff with IT-security skills.  This can be a major headache for all businesses.  It can be particularly challenging for SMEs.  SMEs are likely to lack the budget to offer IT professionals the sort of salaries they can command with larger organizations. 

They are also likely to be limited as to the opportunities they can offer for professional development.  This can actually be an even bigger issue than salary.  IT is a very fast-moving profession.  IT-security is probably the fastest-moving part of IT.  In other words, people who get left behind can really struggle to catch up.

All of this means that SMEs can really struggle to recruit IT staff in the first place.  They then have to find a way to retain them.  Otherwise, they face dealing with a revolving-door of staff arrivals and departures.  These can quickly become very expensive.

They can also lead to important issues “slipping through cracks”.  For example if your run on-premise infrastructure, you need to manage upgrades, patches and licenses.  Mistakes here can lead to downtime and, potentially, to legal action.  When you move to a cloud environment, your cloud vendor takes care of all that for you.

Cloud adoption can save your real estate bills

Running on-premise infrastructure basically means that you have to hand over valuable office real estate to IT hardware.  Adopting the cloud can make it possible for you to put this space to much more cost-effective use.  In fact, it may even allow you to shrink the size of your office.  This could allow you to save money on rent.  If you own your building, it could make it possible for you to sub-let part of it.  Either way, you benefit financially.

Cloud platforms are made for flexible working

The cloud environment is both scalable and, in principle, accessible from anywhere.  Obviously, most companies will probably want to add some level of security to their cloud access.  The key point to note, however, is that it facilitates remote working in all its forms.

As a minimum, companies can take advantage of this in their disaster-recovery planning. Your preference may be to have all staff in the office at all (working) times.  In reality, however, you will still have to plan for the possibility that you will lose access to your office.  Even if this loss is only for a short time, it can still hurt.  For example, it could happen during a peak period when you really need everyone to be working flat out.

These days, however, companies are increasingly using cloud computing as part of their strategy to recruit and retain staff.  First of all, you can allow your existing staff some flexibility to work remotely.  This can make it a lot easier for them to manage their work/life balance.  Not only is this ethical, it also makes good business sense.  For example, it gets around the problem of staff coming into work when they are “just a bit sick”.  This gets their work done, but spreads the bugs around the whole office.

It can also be used to get around local skill shortages.  If staff can work from anywhere, then you can hire from anywhere.

cloud infrastructure cost

How to get the most out of your cloud infrastructure

Posted on | by Ozzy Brightrose | Leave a Comment on How to get the most out of your cloud infrastructure

Making the most out of your cloud infrastructure

The cloud has lots of advantages besides cost-savings, but there can be no doubt that the possibilities for cost-savings are a major reason why many businesses are undertaking cloud migrations.

If that sounds like you, then here are some points you might want to consider.

Think seriously about going with a single cloud vendor

In theory, it can make a lot of sense to spread your business around different cloud vendors. This minimizes the possibility of disruption and eliminates the possibility of being tied to one vendor.

In practice, you may find that the process of undertaking even small-scale cloud migrations is a whole lot more hassle than it’s worth.

This is particularly likely to be the case for small disruptions. Additionally, one of the defining features of a good cloud vendor is that they have a straightforward process for assisting customers who want to move elsewhere.

If you absolutely must have 100% uptime, then you may need multiple vendors. You will, however, also need a cloud strategy to manage the potential cloud migrations.

Otherwise, the best way to reduce costs is usually to go with a single vendor. That way, you maximize your value to them as a customer.

This may result in perks such as volume discounts and enhanced customer-service options.

Get your sizing right.

The average cloud platform can have upwards of 1.5 million sizing options. These determine not only the size of servers but also the way they are optimized.

For example, servers can prioritize memory, storage capacity or throughput (and there are many other options).

Getting this right reduces costs and improves performance. It is, however, very difficult for humans to wade through all these options by themselves.

It is also massively time-consuming (and, of course, time is money). For both of these reasons, it makes sense to invest in Right-Sizing tools.

Clean up your unused and/or unattached resources

If you’re planning a cloud migration, then it’s a good idea to make sure that your cloud strategy has a process for making sure that basic housekeeping tasks actually happen.

If you’re already using cloud infrastructure, then check that this is actually happening and, if not, then update your cloud strategy to make sure that it does.

You may be surprised just how much you can reduce costs by simple housekeeping, like making sure servers are actually turned off when a job is done and/or that storage is removed from instances before they are terminated.

Stop the use of idle resources

Adding resources to a data center can be a real pain. Because of this, it often makes complete sense to leave a bit of spare capacity “just in case”.

In cloud environments this is both pointless and expensive. The whole point of cloud infrastructure is that it’s flexible and scalable. It’s also billed according to your CPU usage.

Even though an idle computing instance may only use 1-5% of the CPU power it needs when active, over time these little expenses can start to make a big difference to your bottom line and getting rid of them can therefore bring about significant cost savings.

Work to a schedule

Picking up from all of the points mentioned above, an effective cloud-cost management strategy will take advantage of what is possibly the single, biggest strength of a cloud environment and make sure that, insofar as humanly possible, resources are only used exactly when they are needed.

The way to do this is to create regular heat maps of peaks and troughs in demand. Over time, patterns will start to emerge and this can be used to create automated schedules to ensure that the right instance types are made available at the right times.

It’s recommended to keep generating heatmaps on a regular basis so you quickly pick up on any persistent changes in usage patterns and can take action to adjust accordingly.

Make the most of volume discounts

Amazon Web Services offers Reserved Instances and Microsoft Azure offers Reserved VM Instances, both are generally known as RIs and both essentially mean paying upfront to secure volume discounts.

These volume discounts can be as much as 75% and RIs are usually valid for at least one year, sometimes up to three. In other words, they are great news for anyone involved in cloud cost optimization.

Make the most of spot instances

Spot instances are basically the cloud environment’s answer to end-of-day deals in grocery stores, although they are typically sold on an auction basis rather than on a fixed-price basis.

Spot instances, as their name suggests, tend to be made available for short periods and typically need to be used within short periods, often on the same day.

This means that you want to avoid relying on them but you can really reduce costs by making astute use of them.

See Also

AWS Status