Reducing cloud waste: Akamai’s journey to a 40% cost reduction

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Public cloud services are essential to any company’s scaling and innovation processes in the modern digital world. However, they have also proven that cost-efficiency management tools are far from perfect.

The constant growth in cloud waste serves as solid proof of this concept. Resources not used to their full capacity — or unused — still incur costs. The current rate of cloud waste can cost companies millions of dollars, making it imperative for firms to adopt new strategies and tools to address this problem.

One of the first to highlight this trend was Akamai. The company’s costs in the public cloud were growing at an intense pace, and they saw an urgent need to optimise their public cloud spending and eliminate wasteful usage. Under its Project Cirrus’s initiative, Akamai’s public cloud bills were reduced by 40% in the first year alone.

Akamai’s approach to eliminating cloud waste

Akamai’s methods for reducing cloud waste included detailed profiling of cloud usage. For example, the company used third-party clouds to run several mission-critical applications, which proved relatively expensive.

Consequently, several methods were developed to decrease the amount of waste. These methods are based on a hybrid design implemented by the company, proposing ways to identify waste for cost-efficient resource allocation.

1. Automation and right-sizing instances

One key strategy Akamai implemented was automating resource management. By implementing automation tools, the company could monitor and adjust cloud resources in real time, ensuring that they were appropriately sized to meet the demands of each application.

This process, known as ‘right-sizing,’ involves analysing the actual usage of cloud resources and scaling them up or down as needed. By doing so, Akamai was able to reduce cloud waste by up to 40%, significantly reducing unnecessary expenditures.

2. Strategic use of reserved instances

Another critical aspect of Akamai’s strategy was using Reserved Instances (RIs) strategically. Unlike on-demand pricing, which can be costly and unpredictable, RIs offer lower and more consistent pricing. Akamai took advantage of these discounts by carefully planning and reserving cloud capacity in advance, resulting in savings of up to 75% compared to on-demand pricing.

3. Continuous monitoring and optimisation

Akamai understood that reducing cloud waste should not be a one-off activity but an ongoing effort. The company implemented a tracking system that constantly monitors cloud usage and expenditures. Therefore, any detected inefficiencies could be addressed immediately, ensuring that instances of cloud waste would not be repeated.

Adopting best practices for cloud waste management

The 40% reduction in third-party public cloud costs is definitely a valuable lesson that should serve as an example for organisations facing similar problems. Through automation, right-sizing, and more strategic use of RIs, higher control over costs and elimination of waste are possible. Regular monitoring and optimising results are also key to maintaining them over time.

In a world where public cloud costs can easily become exorbitant, a proactive approach to managing cloud waste is a wise business decision and a necessary step toward long-term sustainability and growth.

If you would like to know more, you can read the rest in the full Akamai whitepaper here.