Cloud spending by the U.S. government has been steadily increasing for several years. In 2020, federal agencies spent over $6.6B on cloud computing and services — up nearly 10% from $6.1B in 2019. According to a Bloomberg analysis, the 9%-10% annual growth rate on U.S. government cloud spending is forecasted to continue through 2023.
As multimillion-dollar government cloud contracts, delayed due to the pandemic, resume and federal agencies ramp up digital transformation efforts, 2022 will undoubtedly be a record year in terms of cloud spending for the U.S. government. But, while adopting more cloud-based technologies gives government agencies greater flexibility, availability, and security, they’re also adding more costs — cloud costs which could be reduced with the right tools in place.
Today, ProsperOps announces general availability for its Autonomous Cloud Savings service for AWS GovCloud. ProsperOps for AWS GovCloud helps federal, state, and local government organizations, as well as commercial entities subject to regulation, achieve best-in-class cost savings, placing their results among the top 2% of AWS optimizers.
Why is cloud cost optimization important for AWS GovCloud customers?
Along with added security and infrastructure that meets much stricter compliance requirements, AWS GovCloud carries a premium price — higher than similar compute resources available from AWS for customers in commercial regions. For example, a m5.large Linux in US East (N. Virginia) has an on-demand rate of $0.0960, while the same m5.large Linux in GovCloud (US-East) has an on-demand rate of $0.1210, a 26% premium.
In other words, unlike their commercial counterparts, GovCloud customers are paying a higher price for their AWS cloud services. However, just like Amazon’s commercial customers, AWS GovCloud customers face the same challenges when it comes to controlling costs with Savings Plans and Reserved Instances (RIs).
AWS provides multiple discount instruments to optimize compute spend, but each instrument has different trade-offs and it’s easy to become locked-in with rigid and never-ending 12 or 36 month commitments to AWS.
Maximizing savings means minimizing on-demand spend, but with changing architectures, dynamic cloud usage, and rapidly evolving technology, DevOps and FinOps teams are rightfully concerned about locking-in and overcommitting to AWS.
As a result, most commercial organizations, using discount instruments, never achieve Effective Savings Rates greater than 10%.
Effective Savings Rate: The overall discount achieved off the on-demand price across the global compute environment. Continue reading about Effective Savings Rates and why ESR is the most important metric when gauging the success of your discount management strategy.
ProsperOps delivers a simple, fully autonomous cost optimization experience that automatically blends AWS Savings Plans and Reserved Instances to maximize compute savings while minimizing commitment risk. The ProsperOps discount management service for AWS GovCloud supports organizations subject to more stringent legal, compliance, and security standards, such as U.S. government agencies and entities subject to government oversight.
The easy-to-use, automated AWS cost optimization tool allows GovCloud customers to automatically maximize their Effective Savings Rate while minimizing their use of rigid, long-term discount instruments.
AWS GovCloud organizations interested in learning more can request a demo online, or submit a contact request on the AWS Marketplace through our APN profile.