Cost - Hybrid Connectivity

Cost

Definition

In the cloud, the cost of hybrid connectivity includes cost of provisioned resources and usage. Cost of provisioned resources is measured in units of time such as hourly. Usage is for data transfer and processing usually measured to in gigabytes (GB). Other cost includes the cost of connectivity to the AWS network point of presence. If your network is within the same colocation facility, it might be as little as the cost of a cross connect. If your network is in different location, there will be a service provider and/or APN Direct Connect partner costs involved.

Impact on design decisions

Organizations try to maximize efficiency and reduce cost. An optimal hybrid connectivity solution has to meet business and technical requirements at the lowest cost possible. If connectivity is provisioned with just enough bandwidth to meet requirements, it optimizes for current cost. However, it might be hard and costly to scale the connectivity if requirements change. Another aspect to consider is at scale, private connectivity can often be cheaper even with the higher cost of provisioned resources including service provider cost. This is because data transfer cost per GB over AWS Direct Connect is cheaper than internet. For example, if you have bandwidth-heavy workloads that you wish to run on AWS, AWS Direct Connect reduces your network costs into and out of AWS in two ways. First, by transferring data to and from AWS directly, you can reduce your bandwidth commitment to your internet service provider. Second, all data transferred over your dedicated connection is charged at the reduced AWS Direct Connect data transfer rate rather than internet data transfer rates.

With AWS, you can elastically adjust your usage up and down. If you are using a network service provider for connectivity between on-premises and a Direct Connect location, your ability to change your bandwidth commitments is based on your contract with the service provider. AWS can deliver your traffic to any AWS Region except China from any AWS network point of presence using AWS backbone. This capability has many technical benefits over using just internet to access remote AWS Regions. There is a data transfer cost premium for using AWS backbone. If there is an AWS Transit Gateway in the traffic path, it adds data processing cost per GB.

Finally, AWS charges for data egress with hybrid connectivity solutions. Optimal application design keeps data processing within AWS and minimizes unnecessary data egress. Data ingress to AWS is free. It means that any use case which sends a lot of data to AWS is very economical from the data transfer cost perspective.

Note: As part of the overall connectivity solution, in addition to the AWS connection cost, you should also consider cost of the end to end connectivity including service provider cost, cross connects, racks and equipment within DX location (if required).

Requirement definition

  • How much data do you anticipate to send to AWS per month?

  • How much data do you anticipate to send from AWS per month?

  • Is this connectivity permanent?

Technical solutions

If you are not sure if you should use internet or private connectivity at this point, calculate a breakeven point before AWS Direct Connect becomes cheaper than using internet. If the volume of data means that AWS Direct Connect is cheaper, and you require a permanent connectivity, AWS Direct Connect is the optimal connectivity choice.

If the connectivity is temporary and internet meets other requirements. It could be cheaper to use AWS S2S VPN over internet due to elasticity of the internet. This choice assumes that you have sufficient internet connectivity in your on-premises network.

If you are within a facility which has AWS Direct Connect, you can establish a cross connect to AWS. This means using dedicated connection that comes at fixed sizes. AWS Direct Connect partner offer further bandwidth granularity and smaller sizes which may optimize your connectivity cost. As example, you can start at 50Mbps Hosted Connection vs 1Gbps Dedicated Connection.

With AWS Transit Gateway you can share your VPN and Direct Connect connections with many VPCs. While you are charged for the number of connections that you make to the AWS Transit Gateway per hour and the amount of traffic that flows through AWS Transit Gateway it simplifies management and reduces number of VPN connections and VIFs required. Benefits and cost savings of lower operation overhead can easily outweigh the additional cost of data processing. Optionally you can consider a design where AWS Transit Gateway is in the traffic path to most VPCs but not all. This approach avoids the AWS Transit Gateway data processing fees for use cases where you require to transfer very large amounts of data into AWS. Refer to the connectivity models’ section for further details on this design. Another approach it to combine AWS Direct Connect as a primary path and use AWS S2S VPN over the internet as backup/failover path. While technically feasible and very cost effective, this solution has technical downsides discussed in reliability section and harder to manage. AWS doesn’t recommend it for highly critical or critical workloads.

The last approach is a customer-managed VPN or SD-WAN deployed in Amazon EC2 instance(s). This can be cheaper at scale if many tunnels, each with low-bandwidth needs, are required when compared to AWS S2S VPN. There is also a management overhead, the cost of licensing, and the cost EC2 resources for each virtual appliance to consider.

Table 1 – Cost effectiveness comparison

Category Customer-managed VPN or SD-WAN AWS S2S VPN AWS Accelerated S2S VPN AWS Direct Connect Hosted Connection AWS Direct Connect Dedicated Connection
Requires customer internet connection Yes Yes Yes No No
Provisioned resources cost EC2 instance and software licensing AWS S2S VPN AWS S2S VPN and AWS Global Accelerator Applicable capacity slice of port cost Dedicated port cost
Data transfer cost Internet rate Internet rate or DIRECT CONNECT rate Internet with data transfer premium DX rate DX rate
Transit Gateway Optional Optional Required Optional Optional
Data processing cost N/A Only with AWS Transit Gateway Yes Only with AWS Transit Gateway Only with AWS Transit Gateway
Can be used over AWS Direct Connect? Yes Yes No N/A N/A