Riptide Blog

How Much Does the Cloud Really Costs You?

Posted by Raquel Galan on June 3, 2015

Cloud Costs

Riptide Software, an Amazon Solutions Partner, provides best in class programming, design, and implementation services to it’s customers. This article, part two of a three part series, will break down the total cost of ownership of a startup’s large web application into business requirements, growth, and capacity. This article will focus on the cost of running the application in Amazon’s Cloud.

As a startup hosting a large web application in a local server closet, the cost is around $19,500 a year. Amazon estimates the cost of a hosting a comparable application in their cloud services at $1082 per month, or close to $13,000 a year.

Cloud Costs, Explained

Riptide Software has been developing custom software solutions for Fortune 100 Companies for almost 20 years. The Total Cost of Ownership (TCO) of a software application includes hardware costs, electricity, cooling, and Internet access. All of these must be considered in the overall cost of a large web application.

Hardware Costs

Riptide Software follows published best practices for Amazon Web Services infrastructure setup. Hardware costs are distributed over multiple servers, keeping the overall cost low. A large web application would require a single EC2 Instance as the server, Amazon S3 for storage, snapshots, and backups, Route 53 for DNS, Amazon CloudFront for edge network content delivery, Amazon RDS for a Database Management, with DynamoDB as the Database engine. These services total to approximately $1,082 a month.

Electricity & Backup Power

With Amazon Web Services, electricity and compute power is factored into the cost of the infrastructure that is setup. Amazon is known to exceed the industry standard for backup power: local battery backups that fail over to a large battery array that fails over to multiple fuel powered generators. Riptide Software deploys infrastructure in multiple availability zones to eliminate the risk of a total power failure in a single zone.

Server Room Cooling

Amazon Web Services builds its data centers close to natural cooling sources such as rivers, lakes, and other large bodies of water. The cost of keeping the entire data center cool is factored into the monthly cost of infrastructure setup.

Bandwidth Costs

Amazon Web Services charges different rates based on how bandwidth is being used. Transferring data into AWS costs less than transferring data out of AWS. Internal data transfers can be free, depending on the services the data is being transferred to and from. Riptide Software uses Amazon’s Simple Bandwidth Calculator to get a better idea of what charges might be seen for a particular web application.

Business Growth

TCO’s have to incorporate the unwritten “rule of five years” that states a business will need to replace a key server every five years to remain current with technology and available resources. The “rule of five years” is effectively eliminated by using Amazon’s Web Services. If any of the infrastructure you have deployed is becoming aged or experiencing issues, you’ll receive a notification from Amazon to simply redeploy that segment of your infrastructure. If an EC2 instance is scheduled for retirement, you’re given ample notice to migrate your deployment to a new EC2 instance. Riptide Software has performed multiple migrations for our customers over the years we have been an Amazon Solutions Provider.

 Business Capacity

By following Amazon’s best practices for infrastructure deployment, businesses can mitigate risks associated with service outages and control growth expenses.The ability of a business to successfully provide services is directly related to the underlying stability and redundancy of their infrastructure.  Riptide Software creates software solutions deployed on AWS that hold up under the most rigorous demands.

Downtime Due To Service Outages

Service outages happen at the worst times possible, potentially costing businesses time, money, and embarrassment. Power failures, equipment failures and local Internet outages are issues that businesses have had to deal with themselves in the past. Amazon Web Services takes on the entire risk and strives to provide the highest up time in the industry.

Server Maintenance & Infrastructure Upgrades

Adding more hard drive capacity, CPU power, or RAM is a simple reconfiguration and redeployment of a service. Adding additional availability zones is just a matter of selecting the proper options from a list. Software and other compliance audits can be done “live”, with no interruption to services.

Localized Natural Disasters

With an application deployed in multiple availability zones, localized natural disasters tend to be less of a business worry for the application owner. In the event of a disaster affecting one of Amazon's Data Centers, traffic would be automatically diverted to an additional availability zone without any interruption in service.

One of the largest independent software corporations in the world, CA Technologies, estimates that large enterprise businesses lose $71,429 in revenue for each hour of downtime.

By following the best practices published by Amazon, start up costs, risks, and overhead are all minimized for a company producing a large web application. Riptide Software has deployed hundreds of successful cloud based software applications using Amazon Web Services. As an Amazon Solutions Partner, Riptide Software provides best in class programming, design, and implementation and integration services to it’s customers. Riptide is committed to sustaining the best practices set forth by Amazon Web Services.

To learn more about how Riptide Software can help your business, please contact us today.

Topics: Amazon Solutions Partner, Amazon Web Services, AWS, Bandwidth Calculator, Cloud Costs, GUI, Managed Services, PCoIP zero clients, phpDHCPAdmin, Solutions

Written by Raquel Galan

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