Who left the big instance on?

Four ways to pay for the same server

The same instance can cost very different amounts. On-Demand Instances: pay by the second or hour, no commitment; best for short, spiky or unpredictable work. Savings Plans: commit to a steady amount of compute spend per hour for 1 or 3 years. Reserved Instances (RIs): commit to an instance configuration for 1 or 3 years. AWS says both can save up to 72% compared with On-Demand. Spot Instances: spare Amazon EC2 capacity at up to 90% off On-Demand, but AWS can reclaim it with a two-minute warning.

Mr. Barkley: Up to 90% off? Put everything on Spot!

Exam tip Steady 24/7 = Savings Plans or RIs. Unpredictable = On-Demand. Can stop and restart = Spot. Never Spot for the always-on shop.

Reserved Instance flexibility

RIs aren't all equally rigid. Standard RIs give the bigger discount; you can change some details, such as the Availability Zone (AZ) or the instance size within the same family, and sell unused ones on the RI Marketplace. Convertible RIs give a smaller discount but can be exchanged for a different instance family, operating system or tenancy. A regional RI applies to any AZ in its Region and to different sizes in the family; a zonal RI also reserves capacity in one AZ.

Mr. Barkley: So the more I promise, the less I pay. Like kibble by the pallet.

Exam tip More flexibility = less discount. Need to switch instance families later? Convertible. Paying more up front (All Upfront) gives a bigger discount than No Upfront.

RIs across AWS Organizations

With consolidated billing in AWS Organizations, all accounts are treated as one for billing. So an RI bought in one account can lower the bill of a matching instance running in another account in the organization. Savings Plans share the same way. The management account can turn this sharing off for specific accounts, for example to keep a team's discounts to itself.

Dev: Production bought the RIs, but at night the test account's servers use the leftover discount. Nothing wasted.

Dedicated Hosts, Dedicated Instances, Capacity Reservations

Dedicated Hosts are whole physical servers for your use only, with visibility into sockets and cores, so you can bring per-socket or per-core software licenses (BYOL, Bring Your Own License) and meet strict rules. Dedicated Instances run on hardware dedicated to your account, without that host-level control. On-Demand Capacity Reservations reserve EC2 capacity in a specific AZ for any length of time, with no term; you pay for them whether or not you use them.

Exam tip Licenses tied to physical cores or sockets = Dedicated Hosts. Guaranteed capacity in one AZ for an event, no 1-3 year term = Capacity Reservation.

Data in, data out

General rules for data transfer costs:

• Data coming in to AWS from the internet: generally free
• Data going out from AWS to the internet: charged per gigabyte (GB)
• Between AWS Regions: charged (on the sending side)
• Between Availability Zones in the same Region: usually charged, a smaller amount
• Within the same AZ over private Internet Protocol (IP) addresses: generally free

Ranger: carries a toy into the yard: free. Refuses to bring it back out: expensive.

Exam tip Exam rule of thumb: in is free, out costs, crossing Regions costs. CloudFront can lower data transfer out costs for popular content.

Paying for storage tiers

Storage is priced by what you keep and how you use it. Amazon Simple Storage Service (Amazon S3): per GB stored each month (cheaper in colder classes), plus requests, and retrieval fees and minimum storage durations for the Infrequent Access (IA) and Glacier classes. Amazon Elastic Block Store (Amazon EBS): per GB you provision, even if the volume is empty, plus snapshots. Amazon Elastic File System (Amazon EFS): per GB you actually use, with cheaper infrequent-access storage classes.

Exam tip Cold classes are cheap to keep, expensive to read. A volume you provisioned but don't use still bills: delete unattached EBS volumes.

Before, during, after

AWS Pricing Calculator estimates the cost of a design before you build it, using AWS's published pricing (each service's pricing page lists its rates). AWS Budgets sets cost or usage limits and alerts you, by email or Amazon Simple Notification Service (Amazon SNS), when actual or forecasted spend passes them; budget actions can even apply a restriction. AWS Cost Explorer charts past costs, filtered by service, account or tag, and forecasts the coming months.

Exam tip Estimate before = Pricing Calculator. Alert when over = Budgets. Analyze what happened and forecast = Cost Explorer.

Consolidated billing in AWS Organizations

AWS Organizations groups many AWS accounts under one management account. Its consolidated billing gives one bill for all of them, at no extra charge. Usage is combined, so the whole company reaches volume pricing tiers sooner, and RI and Savings Plans discounts are shared. Each account's costs are still listed separately, so you can allocate them back to the right team.

Maya: One bill for test, production and the data team, but I can still see who spent what.

Guardrails for every account: SCPs and Control Tower

In AWS Organizations, member accounts sit in organizational units (OUs), such as Production and Test. A service control policy (SCP) on an OU or account caps what anyone in those member accounts can do, even admins and the root user. An SCP grants nothing by itself (IAM must still allow the action), and it doesn't limit the management account. AWS Control Tower sets up a landing zone: a ready multi-account setup with guardrails (controls) and central logging.

Priya: Even an admin in the test account can't get past the SCP.

Exam tip Cap what an account or OU can ever do = SCP. Grant a person access = IAM policy or permission set. Governed accounts, fast = Control Tower.

Cost allocation tags

A tag is a label on a resource, such as project=shop. Cost allocation tags let you group the bill by those labels. AWS-generated tags are created by AWS (they start with aws:, such as aws:createdBy). User-defined tags are the ones you create. Either kind must be activated in the Billing and Cost Management console before it shows up in Cost Explorer and the Cost and Usage Report, and only from then on.

Exam tip Trap: tagging a resource isn't enough. Activate the tag key as a cost allocation tag, or it won't appear in billing reports.

The Cost and Usage Report and billing support

The AWS Cost and Usage Report (CUR) is the most detailed billing data: line items by hour or day, with a column for each activated cost allocation tag, delivered to an S3 bucket to analyze with Athena, Redshift or Quick Sight. For billing and account questions, every customer, even on Basic Support, can open a case in AWS Support Center. The AWS Billing and Cost Management console brings bills, payments and these tools together.

Priya: Cost Explorer for the quick look. The CUR when the auditor wants every line.

Exam tip Most granular, line-item data for your own analysis = Cost and Usage Report. Quick charts = Cost Explorer.

The options

The same EC2 instance can be paid for in several ways:

• On-Demand: pay by the second/hour, no commitment. Short, unpredictable workloads; testing
• Savings Plans: commit to a $/hour amount for 1 or 3 years for a big discount. Compute Savings Plans apply to EC2, Fargate and Lambda in any Region/family; EC2 Instance Savings Plans are for one family in one Region with a bigger discount
• Reserved Instances (RIs): commit to an instance configuration for 1 or 3 years; Standard or Convertible
• Spot Instances: spare capacity at up to a 90% discount, but AWS can interrupt them with a 2-minute warning. Fault-tolerant, flexible jobs (batch, rendering, CI)
• Dedicated Hosts: a whole physical server for you; needed for some per-socket/per-core licenses (BYOL) and compliance
• Dedicated Instances: your instances on hardware not shared with other customers (no host-level control)
• On-Demand Capacity Reservations: reserve capacity in an AZ without a term commitment; pay On-Demand rates

Quick matching

Steady 24/7 for years = Savings Plans or RIs. Can be stopped any time and cheapest = Spot. Short, unknown = On-Demand. License tied to physical cores = Dedicated Hosts. Guarantee capacity for an event = Capacity Reservation.

Exam tip Payment options for RIs/Savings Plans: All Upfront (biggest discount), Partial Upfront, No Upfront.

Amazon S3 storage classes

Pick a class by how often you read the data and how fast you need it back:

• S3 Standard: frequently accessed data
• S3 Intelligent-Tiering: moves objects between tiers automatically when access patterns are unknown
• S3 Standard-IA and S3 One Zone-IA: infrequent access, cheaper storage, retrieval fee (One Zone keeps one AZ only)
• S3 Express One Zone: highest-performance, single-AZ
• S3 Glacier Instant Retrieval: archive with millisecond access
• S3 Glacier Flexible Retrieval: archive, minutes to hours to retrieve
• S3 Glacier Deep Archive: cheapest, retrieval within 12 hours

Moving data between tiers

S3 Lifecycle rules transition objects to cheaper classes after a number of days and expire them later. EBS has SSD and HDD volume types; EFS and FSx have infrequent-access tiers too.

Exam tip Unknown or changing access patterns = Intelligent-Tiering. Keep 7 years for compliance, rarely read = Glacier Deep Archive.

Standard vs Convertible

Standard RIs give the biggest discount; you can modify some attributes (AZ, size within the family, network type) and sell them on the Reserved Instance Marketplace. Convertible RIs have a smaller discount but can be exchanged for RIs with a different family, OS or tenancy.

Size flexibility and scope

Regional RIs apply to any AZ in the Region and, for Linux/Unix, to any size in the same instance family (instance size flexibility: one large RI can cover two mediums). Zonal RIs reserve capacity in one AZ but don't get size flexibility.

Exam tip Need to change instance family later = Convertible RI (or a Compute Savings Plan).

Where to look

The Billing and Cost Management console shows your bills, payments and credits.

• AWS Cost Explorer: charts of past costs, forecasts and rightsizing recommendations
• AWS Budgets: set cost or usage budgets with alerts (and actions)
• AWS Cost Anomaly Detection: alerts on unusual spend
• AWS Cost and Usage Reports / Data Exports: the most detailed billing data
• AWS Billing Conductor: custom billing views for resellers or internal chargeback
• Consolidated billing in AWS Organizations: one bill, combined volume discounts

Getting help

Every account, even on Basic support, can open billing and account support cases for free. Enterprise support adds a concierge team for billing questions.

Exam tip Alert me before I go over $500 this month = AWS Budgets. Show me what I spent last quarter by service = Cost Explorer.

Pricing tools

Ways to look up or estimate prices:

• AWS Pricing Calculator: estimate the monthly cost of a planned architecture before you build it
• Each service's pricing page
• AWS Price List API: query prices programmatically
• AWS Free Tier: always-free offers, 12-month free (for older accounts) and trials; newer accounts get credits

What drives the bill

Most services charge for compute time, storage and data transfer out. Data transfer into AWS is generally free; data out to the internet and between Regions costs money.

Exam tip Estimate costs for a new project = Pricing Calculator. Analyze costs already spent = Cost Explorer.

What they do

A tag is a key-value label on a resource (for example Project=Website, CostCenter=Marketing). When you activate a tag as a cost allocation tag in the Billing console, it appears as a column in Cost Explorer and the Cost and Usage Reports, so you can see costs by project, team or environment.

• AWS-generated tags (for example aws:createdBy)
• User-defined tags you create
• Tags only show in billing data after activation, and only from then on

Governance

Use tag policies in AWS Organizations to enforce consistent tags, and AWS Budgets filtered by tag to track each team's spend.

Exam tip 'Charge each department for its AWS usage' = cost allocation tags (plus separate accounts in Organizations).

The most detailed billing data

AWS Cost and Usage Reports (CUR), now delivered through AWS Data Exports, contain line-item detail of every charge: service, usage type, resource ID, tags, pricing and discounts, updated several times a day and delivered to an S3 bucket. Analyze them with Amazon Athena, Amazon Redshift or Amazon QuickSight.

Exam tip Most granular cost data for your own analysis = Cost and Usage Reports. Quick charts in the console = Cost Explorer.

Families by job

Instance types are named like m7g.large: family (m), generation (7), options (g = Graviton processor), size (large).

• General purpose (M, T): balanced; T types are burstable
• Compute optimized (C): high CPU, such as batch processing and game servers
• Memory optimized (R, X): large in-memory databases and caches
• Storage optimized (I, D, H): high disk throughput, large data sets
• Accelerated computing (P, G, Inf, Trn): GPUs and ML chips

And how you pay for them

Any type can be bought as On-Demand, Reserved Instances / Savings Plans or Spot (see Compute purchasing options).

Exam tip In-memory database = memory optimized. High-performance web server or batch = compute optimized.