Compute and Virtual Private Clouds; A Primer on Cloud Cost and Complexity Creep, Part II

Companies often first think about the storage costs that they incur when they store their backup data in the cloud. But compute costs incurred when they recover VMs in the cloud as well as the complexity associated with creating and managing virtual private clouds in the cloud service provider’s cloud can get overlooked. In this second installment of three on controlling cloud costs and complexity, I examine how compute charges and managing virtual private clouds (VPCs) can impact the success that companies experiences when using the cloud for their backup and recovery initiatives.


Companies that plan to use Amazon Web Services (AWS) for disaster recovery need to understand the different types of virtual machines that AWS makes available to them to recover their applications and the costs associated with each VM type. While AWS does make some VMs available at no cost, these VM types are usually only appropriate for testing purposes. If planning a test or real disaster recovery, AWS makes different VM types available that have different pricing associated with them.

On-Demand instances often come to mind first, of which they are many. AWS currently makes over 90 different On-Demand VM configurations available. AWS also makes VMs available as either Reserved or Spot instances. While companies can acquire these at a lower price, they come with certain restrictions and some are not always available. Companies can even purchase dedicated physical machines from AWS to host their applications in the cloud if they desire guaranteed availability.

Due to the number of VM configurations and the price variance per hour that AWS charges for each VM type, companies should align each of their application requirements to the type of VM instance that they need to recover their application each time they go to recover. They must then forecast what the compute costs of these VMs will be when calculating the total cost to recover their applications with AWS.

Sample AWS EC2 On-Demand Instance Types & Pricing

On-Demand Instance Types (Number) Pricing
General Purpose (32) $0.0052 – $5.424/hour
Compute Optimized (17) $0.085 – $3.456/hour
GPU Instances (9) $0.90 – $24.48/hour
Memory Optimized (20) $0.126 – $6.669/hour
Storage Optimized (17) $0.156 – $5.52/hour

Source: Amazon Web Services; September 2018

Virtual Private Cloud (VPC) Management

As companies adopt the cloud, they must also determine how they intend to manage the virtual private clouds (VPCs) that they create with a cloud service provider such as AWS before they begin to use its cloud. Minimally companies should setup a corporate account and designate someone in the company to function as their VPC administrator.

This administrator assumes responsibility for:

  • Creating groups;
  • Assigning different security settings to each group;
  • Creating user logins;
  • Putting user logins in each group; and,
  • Overseeing the management of the company’s VPC in the cloud.

The administrator also manages and controls user access to AWS’ compute, network, and storage resources within the VPC, plus this individual will need to monitor billing costs associated with corporate use of the AWS VPC resources.

Companies can permit the creation of individual AWS accounts which are easier and faster to setup than corporate accounts. Yet when one creates any AWS account (corporate or individual,) AWS by default creates a VPC for each login. This login gives each individual access to all the features and resources that AWS has to offer. Further, none of the billing or management of an individual account falls under a single corporate account. This makes it difficult for companies to track costs or security when setting up multiple individual accounts.

In part III of this series, I examine the budget buster gotcha’s that companies can encounter when using a general purpose cloud service provider for their backup and recovery needs.



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