Cloud Cost Optimisation
The practice of reducing cloud computing costs while maintaining or improving performance, through right-sizing, reserved instances, spot instances, and eliminating waste.
In-Depth Explanation
Cloud cost optimisation ensures businesses get the most value from their cloud spending by eliminating waste, right-sizing resources, and leveraging cost-saving pricing models.
Key cost optimisation strategies:
- Right-sizing: Matching instance types to actual workload requirements (most instances are over-provisioned)
- Reserved instances/savings plans: 30-75% discounts for 1-3 year commitments on predictable workloads
- Spot/preemptible instances: 60-90% discounts for interruptible workloads
- Auto-scaling: Scale down during off-peak hours
- Storage tiering: Move infrequently accessed data to cheaper storage classes
- Idle resource elimination: Shut down unused instances, delete unattached volumes
Cost monitoring tools:
- AWS Cost Explorer: Native AWS cost analysis
- Azure Cost Management: Native Azure cost tracking
- Google Cloud Billing: Native GCP cost management
- CloudHealth/Spot.io: Third-party multi-cloud cost management
- Infracost: Cost estimates for Terraform changes before deployment
Cost allocation practices:
- Tag all resources for department/project attribution
- Set up budgets and alerts for spending thresholds
- Implement cost dashboards for visibility
- Regular monthly cost reviews
- Chargeback or showback to business units
Common cost traps:
- Forgotten development/test environments left running
- Over-provisioned databases and instances
- Unattached storage volumes
- Data transfer costs between regions
- Logging and monitoring data retention too high
- Not using reserved capacity for predictable workloads
Business Context
Most businesses overspend on cloud by 20-35%. Systematic cost optimisation can reduce cloud bills by 25-40% without sacrificing performance or availability.
How Clever Ops Uses This
Clever Ops conducts cloud cost audits for Australian businesses, identifying waste and implementing optimisation strategies that typically reduce cloud spending by 25-40% while maintaining or improving performance.
Example Use Case
"A SaaS company engages in cloud cost optimisation: right-sizing reduces compute costs by 30%, reserved instances save another 25% on databases, and eliminating idle resources saves $3,000/month, totalling $50,000 in annual savings."