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Oladipupo Abeeb Olanrewaju
Oladipupo Abeeb Olanrewaju

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AWS enables quicker movement, lowered IT expenses, and global scalability by offering a wide range of global computing, storage, database, analytics, application, and deployment services. Cloud services, like AWS, empower you to efficiently adjust costs to align with your evolving requirements.

AWS provides a range of services designed to support the development of advanced applications, offering enhanced flexibility, scalability, and reliability. Whether you require computing power, database storage, content delivery, or other features, AWS allows you to pay solely for the specific services you require, for the duration of your usage, without dealing with intricate licensing structures. With over 160 cloud services, AWS presents diverse pricing models, ensuring that you only pay for the services you utilize. Additionally, once you discontinue usage, there are no extra costs or termination fees involved.

Fundamental of Pricing

There are three fundamental drivers of cost which are:
1.Compute resources: You are billed based on hourly or secondly usage starting from resource launch until termination, unless you've prearranged a reservation with predetermined costs.

2.Outbound data transfer : Data sent out from AWS services incurs a charge, while incoming data and transfers within the same Region are free. Confirm data transfer rates beforehand, as exceptions may apply. Outbound data transfer costs are combined across services and billed based on the outbound data transfer rate, listed as AWS Data Transfer Out on your monthly statement. The larger your data transfer, the lower the cost per gigabyte.

3.Storage resources : are data stored in the cloud, you pay per GB.

Pricing model Based on Product

AWS presents various pricing models based on the product you choose. These options include:

  • On-Demand Instances: Pay for compute or database capacity by the hour or second (minimum of 60 seconds) for the instances you use, without long-term commitments or upfront payments.
  • Savings Plans: This flexible pricing model offers reduced rates for Amazon EC2, Amazon SageMaker, AWS Lambda, and AWS Fargate usage in exchange for committing to a consistent usage level (measured in $/hour) for one or three years.
  • Spot Instances: Request spare computing capacity without upfront commitments, at a discounted hourly rate (up to 90% off the on-demand price) using the Amazon EC2 pricing mechanism.
  • Reservations: Secure a greater discount (up to 75%) by paying for capacity in advance with reservations.

AWS Free Tier

The AWS Free Tier provides an opportunity to explore over 60 AWS products without charge. It consists of the following free offer types:

  • Free Trials: These are temporary trials that start from the activation date of a specific service. Once the trial period ends, you'll switch to standard pay-as-you-go rates.
  • 12 Months Free: This tier offers a year of free usage starting from your initial AWS signup date. After the 12-month period or if you exceed the allotted usage, standard pay-as-you-go rates apply.
  • Always Free: These offers remain free indefinitely and are accessible to all AWS customers.

AWS Pricing/TCO Tools

AWS provides complimentary pricing and migration tools at your disposal. Once you've determined the workload specifics and selected services, the AWS Pricing Calculator aids in estimating the overall cost of ownership. Additionally, the Migration Evaluator assists in inventorying your current environment, gathering workload details, and strategizing the design and planning of your AWS migration.

AWS Pricing Calculator

The AWS Pricing Calculator, available online, empowers you to generate cost estimates tailored to your AWS scenarios. It serves as a valuable tool for both newcomers to AWS and those looking to optimize or expand their current usage.

With the AWS Pricing Calculator, you can delve into AWS services aligned with your use cases and create accurate cost projections. This allows you to conceptualize your solutions beforehand, understand the cost breakdown of your estimate, and explore instance types and contract terms that align with your requirements. These capabilities enable you to make well-informed decisions regarding your AWS usage, whether you're planning your costs and usage patterns or pricing out the setup of new instances and services.

It's worth noting that the AWS Pricing Calculator is free to use and provides an estimate of your AWS fees and charges (excluding taxes). However, it's important to remember that the pricing details provided are for informational purposes only.

Migration Evaluator

Migration Evaluator, formerly known as TSO Logic, is a free service designed to generate data-driven business cases for AWS Cloud planning and migration.

Crafting business cases independently can be a lengthy endeavor and may not always pinpoint the most cost-efficient deployment and purchasing strategies. Migration Evaluator expeditiously furnishes a business case, enabling informed decisions for AWS planning and migration. By leveraging Migration Evaluator, your organization gains access to AWS expertise, visibility into various cost-effective cloud migration scenarios, and insights on leveraging existing software licenses to further minimize costs.

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