[HN Gopher] Show HN: Usage 2.0 - Cut AWS Spend by 57% in 5 Minutes
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Show HN: Usage 2.0 - Cut AWS Spend by 57% in 5 Minutes
Hey HN: Kaveh here, the founder of https://www.usage.ai/ We
launched on Hacker News for the first time early last year, and
we've made a lot of progress since then. We've saved tens of
millions of dollars for companies, and we are even more excited to
announce the launch of a new product: insured reservations for RDS!
We worked closely with AWS on this feature and are excited to
finally make it generally available. We help companies drive down
AWS EC2 & RDS spend. Why? Because the way it's done now is a pain.
DevOps and Software Engineers end up spending time managing costs
and reservations rather than focusing on business problems. In the
early days, we saw horror stories of customers with millions of
dollars in monthly on-demand spend simply because their finance
team didn't want them committing to AWS. Worst yet, we've seen AWS
users who ended up overspending by hundreds of thousands of dollars
a month because they overcommitted their Savings Plan commitment.
Here's how it works: We are typically brought in by a DevOps
manager to cut AWS EC2 costs. The app is entirely self-service and
the savings are generated automatically, typically we do this live
on a call. On average, we reduce AWS EC2 spend by 50% for 5 minutes
of work, and RDS spend by ~30%. To reduce by 50%+, we don't touch
the instances, require any code change, or change the performance
of your instances. We buy Reserved Instances on your behalf (a
billing layer change only) and bundle them with guaranteed buyback.
So you get the steep 57% savings of 3-year no-upfront RIs with none
of the commitment. We make money off of a 20% Savings Fee. Happy
to chat directly kaveh@usage.ai Have you experienced any issues
with managing your company or organization's AWS expenses? We'd
love to hear your feedback and ideas!
Author : kavehkhorram
Score : 87 points
Date : 2023-03-01 21:20 UTC (1 hours ago)
| xur17 wrote:
| Any plans to launch this product on Google Cloud?
| kavehkhorram wrote:
| For now we're all-in on AWS, but have plans on going to Google
| Cloud later this year!
| uptownfunk wrote:
| Wow cool, hope you guys are successful.
| kavehkhorram wrote:
| Appreciate your support!
| piperswe wrote:
| Interesting, the financialization of reserved instances. So,
| effectively, this ends up being similar to you buying reserved
| instances then renting them out to customers, taking advantage of
| the market inefficiency inherent in the pricing difference
| between reserved and non-reserved instances?
| 88913527 wrote:
| Why is AWS okay with this-- Isn't this profit that should be in
| their pocket?
| lwhi wrote:
| I was wondering this .. could the fact they have a larger
| guaranteed long term spend, mean they can leverage that future
| income in some way?
| kavehkhorram wrote:
| We actually have a strong positive relationship with AWS!
| They're helping us by introducing us to their customers, and we
| can also be purchased on the AWS marketplace:
| https://aws.amazon.com/marketplace/pp/prodview-3sq4hhmmwb5fg...
| oskarherranen wrote:
| FYI, if you are struggling to find the link in the post like me:
| https://usage.ai
| zer0x4d wrote:
| I recently found out that I was overpaying by about 20% by just
| looking at "Recommendations" tab in AWS Console and buying RIs.
| It was mostly RDS.
|
| I would love a product that automatically manages the RI renewals
| (ex. every year) and instance type changes.
| kavehkhorram wrote:
| Good to hear. :-)
| mulmboy wrote:
| How does this compare to what's offered by doit?
| https://www.doit.com/flexsave/
|
| From my conversations with doit sounds like they offer a similar
| service in that doit acts as an AWS reseller (~~some billing
| magic) and they apply commitment discounts etc. and pass along a
| portion of the savings. doit also claim to throw in free cloud
| architecture and support consulting services as a value add.
| Rapzid wrote:
| I'll reserve your instances for only a 10% savings fee. Or we can
| do a 20% fee and I'll kick you back 10% cash. Hit me up y'all.
| firecall wrote:
| We've just taken over a platform for a client whose previous
| partner almost drove them bankrupt with insane AWS charges,
| support costs and so on.
|
| Most of their initial funding got burnt on charges that didn't
| relate to developing or marketing a product.
|
| AWS is just a horrible product for smaller companies.
| kavehkhorram wrote:
| We've heard similar horror stories -- we're hoping to make the
| cloud a little more manageable!
| pella wrote:
| > We buy Reserved Instances on your behalf (a billing layer
| change only)
|
| > and bundle them with guaranteed buyback.
|
| > .. We make money off of a 20% Savings Fee.
|
| so this is similar business model, like
| https://archera.ai/guaranteed-reserved-instances/
|
| _" Find big-time savings with short-time commitments. Unlike
| typical commitments, Guaranteed Reserved Instances can be sold
| back to Archera within a month of initial purchase and with
| higher savings than standard offerings."_
| Rapzid wrote:
| Archera appears to only charge for GRIs. They don't seem to
| tell you what they charge though.
| acdha wrote:
| > We buy Reserved Instances on your behalf (a billing layer
| change only) and bundle them with guaranteed buyback
|
| This is by setting your AWS account as the payer account so you
| can aggregate? I'm curious how the finances will work out - at
| least one of them had challenges balancing their RIs with
| customer changes since there wasn't a feedback cue for developers
| not to change instance types casually.
|
| On a marketing level, I have an instinctive negative reaction to
| the claims like the title here has because I know it's not true
| for me (my accounts are dominated by storage and network egress
| so even if EC2 were free you couldn't get 57%). I'm wondering how
| best to phrase it to help people understand they can save a lot
| but not make it seem like you're misrepresenting the
| possibilities. It'd also be useful to compare with compute
| savings plans.
| zer0x4d wrote:
| It just depends on what you have. I did get 20% right off the
| bat with RDS just buying no-upfront RIs. I could have probably
| gotten around 30% if I did upfront and longer commitment.
| kavehkhorram wrote:
| This is mainly in reference to the fact that Reserved Instances
| don't have any bearing on the instances themselves (ie. no code
| change, performance chance, server downtime, etc.).
|
| The 57% savings is the difference between the 3-year, no-
| upfront, standard Reserved Instance rate and the On-demand rate
| (for RDS it is 30% vs on-demand)
|
| As far as compute savings plans:
|
| 1-yr SP is anywhere from 26-29% savings vs on-demand
|
| 3-year Sp is anywhere from 49-52% savings vs on-demand
|
| ... but note that these commitments are non-transferrable.
| Customers find our tailorable commitments to be a healthy blend
| of savings + safety against over-committing to volume they may
| not need
| throwaway280382 wrote:
| What is the minimum number of servers I need to buy from you? Can
| I buy just one 4GB server, for example?
| kavehkhorram wrote:
| You can start with as little as one 4GB instance!
| AH4oFVbPT4f8 wrote:
| I'm on a recommendation, it shows reservation 48.28% and $24.53
| Lowest Risk then has a line of text that says "Select a
| recommendation to compare it to actual resource utilitzation"
|
| three things, what does select a recommendation to compare it to
| mean? I'm not sure what I should be selecting. And second, is it
| utilitzation or utilization? Or is that word like canceled and
| cancelled ?
|
| and the third thing, when approving, I see total savings of
| $24.53 and by selecting approve, you'll be charged with 20% of
| realized savings monthly. Should this give me some idea of how
| much this will cost ?
|
| I would think its $24.53/12 = $2.44 * .2 = $0.488
|
| Is that correct?
| honkler wrote:
| cut AWS stock prices by 57% in 5 minutes!
| [deleted]
| throwaway8689 wrote:
| Jeff bezos hates this one weird trick
| surfmike wrote:
| How does this differ with Vantage Autopilot
| https://www.vantage.sh/features/autopilot ?
| andrenotgiant wrote:
| just from reading the site, looks like vantage takes a 5% fee
| vs Usage 20% - but that's a big difference, not sure if it's an
| apples-to-apples comparison.
| axlee wrote:
| > Autopilot charges only 5% of the savings found to maximize
| customer savings: 75% less than other providers in market.
|
| Sounds accurate.
| andrenotgiant wrote:
| How would you describe the mechanics of this in regular finance
| terms... Almost like you are providing mortgages for reserved
| instances?
|
| I think I understand the model here, but I guess I'm curious how
| you model in risk of suddenly getting stuck with a bunch of 3
| year RI commitments?
| kavehkhorram wrote:
| I like to say we're a marketmaker for cloud contracts. Our
| recommendations take our current inventory into account and
| it's been very effective considering the amount of 'trades' we
| successfully make each day. That aside, We also have a
| considerable amount of cash set aside for an event like this.
| teruakohatu wrote:
| Looks really good.
|
| I have been offered large discounts by an AWS reseller, and I
| have not understood exactly how or why they can do this. Are the
| resellers doing what you are doing but being less transparent
| about it?
| unkoman wrote:
| AWS SPP Resellers actually resell for better prices, see
| Partner Originated Discounts.
| https://aws.amazon.com/blogs/apn/introducing-new-aws-solutio...
| kavehkhorram wrote:
| In a way. Resellers typically incorporate a company's AWS
| organization into theirs, and via resource sharing of savings
| instruments, are able to pass on savings to their customers
| within their portfolio. Since they have an AWS organization
| that is comprised of many companies and their AWS accounts,
| they are able to negotiate special pricing arrangements with
| AWS (typically in the form of an EDP) based on the total spend
| of that consolidated organization.
|
| We use similar instruments but allow you to maintain the
| independence of your AWS organization for what is usually
| higher savings.
| axlee wrote:
| Why would they be in a good negotiating position with AWS,
| given that they have to be on AWS to even exist in the first
| place? I don't get why amazon would ever negotiate down with
| these guys, they're the ones who absolutely need the product.
| platformarch wrote:
| How does the buyback program work for your new releases (RDS,
| Elasticache, OpenSearch, DynamoDB)? I use the EC2 RI Marketplace
| but I can't find one for the other products mentioned.
|
| Also, I just reviewed your T&C and your "Program" states that you
| provide "Non-Usage Credits". What does this mean? I don't have
| any guarantee that in an off-scenario where there is an overload
| of RIs being sold I'll stop paying for them. I'd rather use
| Vantage and pay a 5% fee on my RIs.
| sargun wrote:
| This is like insurance in a couple of different ways, and makes
| me happy, but concerned. usage.ai is basically taking a bet that
| a large number of their customers wont cut back on RDS spend
| simultaneously.
|
| AWS massively made RDS instances cheaper when they released RDS
| on Graviton. I can only imagine that'd nearly put a company like
| usage.ai out of business. I'm curious what defense mechanism they
| have against this.
| cj wrote:
| > AWS massively made RDS instances cheaper when they released
| RDS on Graviton. I can only imagine that'd nearly put a company
| like usage.ai out of business.
|
| Are the on demand and reserved prices the same? If RI's exist
| are still cheaper, it shouldn't impact their business model.
| motoboi wrote:
| They made the new instance type much cheaper.
|
| Users already committed to RI cannot change instance types
| and remain bonded to the contract.
|
| Usage.ai and others give you an insurance that you can get
| out of the contract. If that existed before, users would
| return the old instances to usage.ai and get the cheaper
| ones.
|
| Usage.ai end up with a lot of reserved instances no one
| wants, with a large contract to pay.
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(page generated 2023-03-01 23:00 UTC)