AWS Billing & Pricing

In this article we will be learning the different pricing principles in AWS, understand the AWS organization and its elements, what is Consolidated billing, AWS cost management and its tools and AWS pricing calculator.

As a customer, we must pay for any AWS resources or services we utilize. Through several pricing plans for clients, AWS has made the payment choice simpler.

AWS Pricing Principle

Four different pricing options are provided by AWS. Namely

·        Pay as you go

·        Pay less by using more

·        Save when you reserve and retire usage

·        Free tier

Pay as you go: We can rent resources on demand and only pay for what we use thanks to this pricing model. There are no up-front costs, and we only have to continue paying for a service until we no longer need it. This principle provides more flexibility for creation of servers with need.

Pay less by using more: Amazon offers discounts for large orders. Say for example Amazon can provide the benefit of usage of more storage with discount in usage charges. This is one of the benefits for the customer.

AWS is well known for reducing costs every month or every year. Which is excellent from the perspective of the consumer as their infrastructure develops. Due to their size and volume, they will pass along the benefits to their clients by offering them price breaks.

Save when you reserve and retire usage: With this pricing model, we can reserve the capacity for a long time from one to three years and receive a discount of between 30 and 72% off the total cost of the reserved capacity. This applies to services like EC2, dynamodb, elastic cache, RDS and redshift.

Free tier: Many AWS services are available to us without charge for a year or until we use up our allotted allocation. For instance, the maximum duration of an EC2 instance is 750 hours, and the maximum storage size for Amazon S3 is 5 GB. However, we should prepare our budget in advance to guarantee that free resources are properly used.

AWS Organization

AWS organization is an account management service that allows managing multiple AWS accounts.

·        So we can add, create, and manage AWS accounts centrally using AWS organizations.

·        Additionally, we can regulate invoicing, access compliance, security, and resource sharing across your AWS accounts.

·        It is easy to set up and is provided without charge to all AWS customers.

·        AWS organization is also intended to structure our accounts to better meet the needs of our organization.

·        It may be in line with the business line or portfolio team of our company.

AWS organization has four components

1.     Master/Root Account

2.     Member Account

3.     Organization Unit

4.     Service Control Policy

1.     Master/Root Account: This is the account which is used to create our organization. We can use this account to manage our other AWS accounts. This account will act as the central management and governance hub for all our accounts. We can also use this account to create other accounts, invite other accounts to join our organization and remove accounts from our organization.

2.     Member Account: The accounts which are created and invited to be a part of our organizations are known as member accounts. We can add a new account directly to the organization or invite an existing account.

3.     Organization Unit(OU): Organization unit helps us to group AWS accounts within an organization. We can group accounts based on some conditions.

4.     Service Control Policy: Service control policies are a type of organization policy that we attach to the entire organization or use or individual AWS accounts it defines the services and actions that users or a role can perform.

Consolidated Billing

We can combine billing and payments for several AWS accounts or numerous Amazon Internet Services Pvt. Ltd (AISPL) accounts using the consolidated billing option in AWS Organizations.

Each AWS Organization has a management(master) account that is used to pay for all of the member accounts' fees.

Consolidated billing has the following benefits:

·        One bill – For several accounts, we receive a single bill..

·        Easy tracking – We can keep track of the payments made to various accounts and retrieve the total cost and usage information.

·        Combined usage – To share the volume price discounts, Reserved Instance discounts, and Savings Plan discounts, we can combine the consumption across all accounts in the business. Due to this, our project, department, or business may incur cheaper fees than with separate independent accounts.

·        No extra fee – Consolidated billing is provided without charge.

AWS Cost Management Tool

We can manage and keep track of AWS charges and use statistics with the help of a number of services and tools that AWS offers. For instance, access permission technologies like IAM and SCP will provide us more control, consolidated billing aids in budget planning and accurate forecast estimation.

Amazon offers a wide range of tools you can use to manage and optimize your cloud costs.

·        Billing and Cost Management Console

It has a billing section where we can view all of our AWS service usage statistics and the most recent billing information.

·        AWS resource and cost allocation tags

Additionally, AWS offers cost allocation tags for tracking our AWS expenditures in-depth and AWS resource tags that can be utilized to manage our resources. It is simpler for us to categorize and keep track of our AWS expenditures when we activate cost allocation tags because AWS uses them to group our resource costs on our cost allocation report.

·        Consolidated billing

A single bill for all of our accounts. Through a single bill, it is simple to maintain track of overall expenses and keep tabs on spending from several accounts. We may also get the expense information in a CSV file and track costs from each account.

·        AWS Cost Explorer

The Cost Explorer allows us to view AWS expenses and use for the previous 13 months, which will help us predict how much money we will spend going forward. We may design custom views in Cost Explorer that examine our AWS costs and help us find areas for improvement. Additionally, the AWS Cost Explorer offers an API that enables us to retrieve data using the analytics software we already have.

·        AWS Budget

Using AWS budgets, we can sit down and impose budgets for each AWS service. We will receive emails or messages from the SNS, or basic notification service, when budgets are met or exceeded. Various occurrences, a total cost, or individual data points like data usage can all be linked to a budget.

AWS Pricing Calculator

We can explore AWS services and generate an estimate for the cost of our AWS use cases using the AWS Pricing Calculator.

·        We can utilize the AWS Pricing Calculator, a web-based planning tool, to generate estimates for our AWS use cases.

·        We may use it to model our solutions before constructing them, investigate the price points for AWS services, and examine the mathematics used to produce our estimates.

·        When using Amazon Web Services, we can utilize it to organize our spending, look for ways to cut costs, and come to wise conclusions.

·        AWS Pricing Calculator is useful for those who have never used AWS. It's also useful for those who want to reorganize or expand their AWS usage.

CONCLUSION

From this module we will be able to decide which AWS pricing model is suitable for our AWS account. According to our requirements we will be able to apply the knowledge of the AWS organization in setting up our AWS account structures. We will be aware of how to get maximum benefits by using consolidated billing.