When to activate
- Estimating total cost of ownership (TCO) for proposed solutions
- Comparing build vs buy costs for architectural decisions
- Creating cloud cost projections for solution proposals
- Optimizing existing solution costs through right-sizing
When NOT to use
- For personal financial planning
- For simple pricing page calculations
- For procurement negotiations
Instructions
- Inventory components. List all infrastructure, services, licenses, and personnel needed.
- Estimate usage. Project traffic, storage, compute requirements at launch and at scale.
- Model costs. Use provider pricing calculators. Include data transfer, API calls, support tiers.
- Compare options. Build vs buy, different providers, different architectures.
- Present TCO. 3-year projection with growth assumptions. Include hidden costs (migration, training, maintenance).
- Optimize. Identify reserved instances, spot opportunities, right-sizing candidates.
Example
Solution Cost Model: Microservices migration
Year 1:
Compute (EKS): $8,400/mo → $100,800/yr
Database (RDS): $3,200/mo → $38,400/yr
Storage (S3): $800/mo → $9,600/yr
Data transfer: $1,200/mo → $14,400/yr
Monitoring: $600/mo → $7,200/yr
Personnel (0.5 SRE): $90,000/yr
Total Year 1: $260,400
Year 3 (at 5x scale):
Total: $580,000/yr (with reserved instances: $490,000/yr)
vs Monolith (current): $180,000/yr (hitting scaling limits at ~10x)
1---2name: cost-modeling3description: Model solution costs — cloud infrastructure, licensing, personnel, and total cost of ownership analysis4---56## When to activate78- Estimating total cost of ownership (TCO) for proposed solutions9- Comparing build vs buy costs for architectural decisions10- Creating cloud cost projections for solution proposals11- Optimizing existing solution costs through right-sizing1213## When NOT to use1415- For personal financial planning16- For simple pricing page calculations17- For procurement negotiations1819## Instructions20211. **Inventory components.** List all infrastructure, services, licenses, and personnel needed.222. **Estimate usage.** Project traffic, storage, compute requirements at launch and at scale.233. **Model costs.** Use provider pricing calculators. Include data transfer, API calls, support tiers.244. **Compare options.** Build vs buy, different providers, different architectures.255. **Present TCO.** 3-year projection with growth assumptions. Include hidden costs (migration, training, maintenance).266. **Optimize.** Identify reserved instances, spot opportunities, right-sizing candidates.2728## Example2930```31Solution Cost Model: Microservices migration3233Year 1:34 Compute (EKS): $8,400/mo → $100,800/yr35 Database (RDS): $3,200/mo → $38,400/yr36 Storage (S3): $800/mo → $9,600/yr37 Data transfer: $1,200/mo → $14,400/yr38 Monitoring: $600/mo → $7,200/yr39 Personnel (0.5 SRE): $90,000/yr40 Total Year 1: $260,4004142Year 3 (at 5x scale):43 Total: $580,000/yr (with reserved instances: $490,000/yr)4445vs Monolith (current): $180,000/yr (hitting scaling limits at ~10x)46```
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