Concepts
Amazon Web Services (AWS) provides a rich set of tools for managing costs associated with cloud services, giving customers detailed insights into their usage patterns and the ability to control and optimize their spending. To help Solutions Architects and anyone preparing for the AWS Certified Solutions Architect – Associate (SAA-C03) exam understand these tools, we’ll delve into AWS Cost Explorer, AWS Budgets, and the AWS Cost and Usage Report, detailing their functionality and use cases.
AWS Cost Explorer
AWS Cost Explorer is a tool that enables users to visualize their AWS spending and usage patterns over time. With an intuitive interface, Cost Explorer allows users to analyze costs and usage with filtering and grouping capabilities.
Use Cases:
- Identifying Trends: By analyzing the data from the past 13 months, a Solutions Architect can spot cost trends and use this information to forecast future costs.
- Cost Breakdown: Allows for a detailed breakdown of costs by service, linked account, or usage type which can be particularly useful in a multi-department organization.
- Reserved Instance Planning: By tracking RIs utilization and coverage, Cost Explorer helps in deciding whether to purchase additional RIs.
AWS Budgets
AWS Budgets assists users in setting budget thresholds and receiving alerts when costs or usage exceed preset budget amounts.
Use Cases:
- Cost Control: A company can set a budget for their expected monthly AWS costs and be alerted if the cost is likely to exceed this budget.
- Resource Usage: AWS Budgets can monitor the usage of specific AWS resources, which is useful for ensuring that resource utilization stays within an expected range.
- Cost Allocation: Helps in tracking how costs are distributed across different projects or teams, ensuring that each is staying on budget.
AWS Cost and Usage Report
The AWS Cost and Usage Report (CUR) provides detailed information about the cost and usage associated with AWS services, delivering comprehensive data to the user’s Amazon S3 bucket.
Use Cases:
- Detailed Cost Analysis: It provides line-item details on each service, enabling a deep dive into the exact costs.
- Data Transfer Analysis: Organizations can analyze the data transfer costs which often have significant impact on the total bill.
- Third-Party Integration: Data can be ingested by third-party tools for custom analysis, budgeting, and reporting.
Comparing the Tools
| Feature | Cost Explorer | AWS Budgets | Cost and Usage Report |
|---|---|---|---|
| Data Access | Visual interface | Alerts and budget thresholds | Delivered to S3 bucket |
| Analysis Scope | Up to 13 months of historical data | Real-time monitoring | Most detailed and historical data |
| Customization | Limited to GUI options | Can set custom alerts | Highly customizable data sets |
| Data Delivery | Immediate within the console | Via email or SNS notifications | Requires processing after delivery to S3 |
| Suitable For | Quick insights and trends | Budget management and alerts | Complex financial analysis or third-party use |
Each of these tools serves distinct but complementary functions in managing AWS costs effectively. For example, a company could use AWS Budgets to set a spending cap on a monthly basis for their various projects. Then, they might use AWS Cost Explorer to drill down into individual services or departments to understand where and why they near or exceed those budgets. Afterwards, they could generate an AWS Cost and Usage Report to conduct a granular audit of every single resource and its associated costs over time, identifying optimization opportunities.
To further illustrate the use of these tools, let’s consider a hypothetical scenario. A Solutions Architect is tasked with managing the AWS costs for a multi-tier web application composed of Amazon EC2 instances, Amazon RDS databases, and various AWS Lambda functions.
- Using AWS Cost Explorer:
They begin by using AWS Cost Explorer to visualize the costs associated with each tier of the application over the previous year. This helps them discover that the majority of the costs are coming from the EC2 instances, which could indicate suboptimal instance sizing or underutilization.
- Implementing AWS Budgets:
Next, they configure AWS Budgets to receive alerts when the costs associated with the EC2 instances exceed a certain threshold, preventing unexpected spikes in spending.
- Deep Diving with AWS Cost and Usage Report:
Finally, they download a detailed AWS Cost and Usage Report to analyze every aspect of the EC2 costs, discovering specific instances that generate disproportionate costs due to data transfer.
By using these tools in tandem, AWS customers have a multi-faceted approach to cost management that can lead to significant savings and more predictable cloud spending.
Answer the Questions in Comment Section
True or False: AWS Cost Explorer can only show past cost data and is not suitable for forecasting future costs.
- (A) True
- (B) False
Answer: B
Explanation: AWS Cost Explorer provides both historical and predictive features, allowing users to analyze and forecast costs for up to 12 months based on previous usage patterns.
True or False: AWS Budgets can be used to set custom budget alerts when your costs or usage exceed your predefined thresholds.
- (A) True
- (B) False
Answer: A
Explanation: AWS Budgets allows customers to set customized budget alerts that notify them via email or SNS when they exceed or are forecasted to exceed their budget thresholds.
Which AWS tool helps you to dive deeper into your cost and usage data at a granular level with the ability to access comprehensive billing information?
- (A) AWS Cost Explorer
- (B) AWS Budgets
- (C) AWS Cost and Usage Report
- (D) AWS Price List API
Answer: C
Explanation: AWS Cost and Usage Report contains the most comprehensive set of cost and usage data available, offering detailed insights for customers to understand their AWS spend.
True or False: AWS Budgets can be used to automatically adjust your service limits when the budget is reached.
- (A) True
- (B) False
Answer: B
Explanation: AWS Budgets can send alerts when you approach your budget limits, but it does not have the capability to automatically adjust service limits.
Which service or feature allows you to track your reserved instance (RI) and Savings Plans utilization and coverage?
- (A) AWS Budgets
- (B) AWS Cost Explorer RI Reports
- (C) AWS Trusted Advisor
- (D) AWS Cost and Usage Report
Answer: B
Explanation: AWS Cost Explorer RI Reports are specifically designed to track the utilization and coverage of reserved instances and Savings Plans.
Multiple Select: Which of the following statements about AWS Cost Explorer are true?
- (A) It allows you to visualize your cost trends over time.
- (B) It can generate cost reports based on tags.
- (C) It can send alerts when actual or forecasted costs exceed a certain threshold.
- (D) It only provides data in graphical formats, not tabular formats.
Answer: A, B
Explanation: AWS Cost Explorer allows users to view their costs in a visual format and create detailed reports based on tags. However, it is AWS Budgets, not Cost Explorer, that sends cost alerts, and Cost Explorer does provide data in both graphical and tabular formats.
True or False: AWS’s Cost and Usage Report can be integrated with Amazon QuickSight for further data visualization and analysis.
- (A) True
- (B) False
Answer: A
Explanation: AWS Cost and Usage Report can be integrated with Amazon QuickSight (as well as other business intelligence tools) for more advanced data visualizations and analyses.
Which AWS tool is primarily used to manage spend on a multi-account setup under AWS Organizations by giving a combined view of costs across all accounts?
- (A) AWS Cost Explorer
- (B) AWS Budgets
- (C) AWS Consolidated Billing
- (D) AWS Cost and Usage Report
Answer: C
Explanation: AWS Consolidated Billing under AWS Organizations allows you to receive a single bill for all the accounts in your organization, making it easier to manage and track costs across multiple accounts.
True or False: AWS Budgets can only be used to manage costs at the account level and not at the organizational level.
- (A) True
- (B) False
Answer: B
Explanation: AWS Budgets can be set up for individual AWS accounts or at the organizational level using AWS Organizations to manage and monitor the aggregated spend.
In the AWS Cost and Usage Report, what type of file format is used for report delivery?
- (A) XML files
- (B) JSON files
- (C) CSV files
- (D) Parquet files
Answer: C
Explanation: AWS Cost and Usage Reports are delivered in CSV format, which is suitable for analyzing large datasets, for easy integration with various analytical tools.
True or False: You can use AWS Cost Explorer API to programmatically query your cost and usage information.
- (A) True
- (B) False
Answer: A
Explanation: The AWS Cost Explorer API allows developers to programmatically access their cost and usage data, facilitating integration with custom applications or third-party tools.
Which AWS tool allows you to define actions that AWS will take automatically to stay within a defined budget, such as stopping an EC2 instance?
- (A) AWS Cost Explorer
- (B) AWS Budgets
- (C) AWS Billing Dashboard
- (D) AWS Budgets’ Cost Management Actions
Answer: D
Explanation: AWS Budgets allows you to define cost management actions that can automatically take effect when a defined budget is exceeded; this is a separate feature called AWS Budgets’ Cost Management Actions and is not a part of the core AWS Budgets or AWS Cost Explorer.
Great post! How effective is AWS Cost Explorer for tracking daily expenses?
Thanks for the information! It’s very useful for preparing my SAA-C03 exam.
I appreciate the detailed breakdown of AWS Budgets. Can it alert me before I exceed my budget?
Can anyone share their experience with AWS Cost and Usage Report for large-scale deployments?
This blog was a fantastic read. Helped me clarify a lot of doubts.
AWS Budgets can send alerts, but is there a way to integrate it with third-party monitoring tools?
Good info. Is there a way to automate cost optimization recommendations?
I tried using Cost Explorer but found it a bit complex. Any tips?