2025: The FinOps Year?
It could be where the FinOps movement decides how it's going to be for the rest of the decade. See inside why.
Victor Garcia
January 05, 2025
In partnership with
NEW YEAR FINOPS MENU
Cost Optimization Strategies for 2025
Maximize Cloud ROI with Unit Economics
Netflix sues Broadcom
👨💻 AWS traffic spikes solved with serverless logging
Mention of Honour: 10 FinOps practices from an advanced Company.
Job Opportunity by Duckbill Group
Professional Spotlight with the Best FinOps Brewer
Differentiate in a Saturated FinOps Market
Partner with FinOps Weekly.
Show your company to the right FinOps audience.
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Cost Optimization
Optimize Cloud Cost Strategies for 2025
This guide provides practical tips to optimize cloud costs, focusing on Amazon Web Services (AWS):
Right-size EC2 instances: Analyze usage and switch to optimal instance types. Innovaccer reduced cloud spending by 33% through right-sizing.
Use Spot Instances for flexible workloads: Take advantage of spare computing power to save up to 90% off on-demand prices. National Australia Bank cut 20% off its cloud bill using Spot Instances.
Automate resource scheduling: Turn off unused resources during non-business hours. Archway saved 40% in non-production environments this way.
Optimize S3 storage: Use appropriate storage classes based on access patterns. Airbnb reduced storage costs by 27% by moving less-accessed data to Glacier.
Use Reserved Instances and Savings Plans: Commit to longer-term usage for predictable workloads to save up to 72%.
Reduce data transfer costs: Use CloudFront and collocate resources to minimize fees. Canva cut data transfer costs by 46% with these strategies.
Adopt serverless architectures: Pay only for compute time used. Coca-Cola reduced 65% of operational costs by migrating to Lambda.
Monitor spending with AWS Budgets: Set up alerts to catch unusual patterns. Zynga saves millions annually by tracking unused resources.
While focused on AWS, these tips can apply to other major cloud providers too. The key is to regularly analyze usage, automate where possible, and match resources to actual needs.
In partnership with Cloud Cost Control
Optimize Your Cloud Costs with Tailored FinOps Training
Having a skilled FinOps team is crucial for managing and optimizing cloud costs. We offer tailored training programs to meet your organization's needs, ensuring your team gains the skills necessary to maximize efficiency and control cloud expenses.
Fundamentals of Cloud FinOps: Core principles for efficient cloud spending management.
Advanced Cost Optimization Techniques: Identify and eliminate unnecessary expenses.
Creating a Financial Management Program: Establish a FinOps program and foster a culture of financial efficiency.
Certification Exam Preparation: Prepare your team for FinOps certifications.
Business
Maximize Cloud ROI: Use FinOps and Unit Economics!
One important part of FinOps is "unit economics." This means looking at how much things cost at a very small level. For example, a company might look at how much it costs to serve one customer or process one transaction. This helps them understand if they're using their cloud resources well. There are two main ways to measure unit economics:
For services that make money: It's easy to see if the cloud costs are worth it. You just compare the cost to the money earned.
For services that don't make money directly: It's harder to measure. You might look at things like how fast new products are made or how much employee work gets done.
To use unit economics well, companies should:
Start small and focus on what's important
Have different teams work together
Use tools to watch costs all the time
Keep checking and changing how they measure things
By using unit economics, companies can make sure their cloud spending is helping them grow and do new things, not just saving money.
Big Companies
Netflix sues Broadcom in Patent Battle over Virtualization
Netflix is fighting back against Broadcom in a patent battle. They've filed a lawsuit about the tech used in virtual computers. This move comes after Broadcom sued Netflix in 2020. Broadcom said Netflix hurt its business that makes chips for TV boxes.
Netflix is using five patents it bought from someone else. These patents concern how virtual computers work. Netflix says VMware, which Broadcom owns, is using these ideas without permission.
This year hasn't been great for Broadcom in court. They lost some cases against Netflix in Germany and the US. They also lost twice against Tesla in Europe. Netflix doesn't usually sue other companies over patents. This new approach might encourage Broadcom to settle the fight faster.
AWS
👨💻 AWS NAT Gateway Traffic Spikes solved with Serverless Logging
AWS NAT Gateways can have unexpected traffic spikes, leading to high costs. This article presents a smart solution to this problem. The solution uses:
CloudWatch Alarms to detect traffic spikes
EventBridge Rules to trigger actions
Step Functions to manage VPC Flow Log recording
Lambda Functions to handle specific tasks
DynamoDB to store recording information
When a traffic spike is detected:
The system starts recording VPC Flow Logs
It continues until the traffic returns to normal
The logs are stored in a cost-effective way
An email notification is sent with details
This approach saves money by only recording logs when needed. It also helps identify unnecessary internet traffic that could be routed through VPC endpoints instead.
The article provides a link to a GitHub repository with installation instructions for those interested in implementing this solution. This clever system helps AWS users keep track of unusual NAT Gateway traffic without breaking the bank.
👷♂️ FinOps Job Offer
Build the next FinOps product with The Duckbill Group
The Duckbill Group is throwing our hat into the ring by building a new FinOps product and we're looking for another engineer for the team. The role is on-site in San Francisco (we'll help with relocation!).
Monitoring
Cloud costs skyrocket: Manage Resources for Control
Many businesses use multiple cloud providers, which makes it hard to track spending. Without good visibility, costs can spiral out of control. One company even got a $65 million bill for cloud monitoring in just three months! To fix this, companies need to:
Get a clear view of cloud usage across all providers and teams
Watch how microservices and containers use resources - studies show 69% of container CPU power is wasted
Keep checking and adjusting cloud resources to match real needs
Understand how cloud pricing works, including monitoring tools
The key is to balance performance and cost. This lets companies stay competitive without overspending. By managing cloud costs better, businesses can save money without slowing down progress.
🎖️ Mention of Honour
10 Key Strategies from an Advanced FinOps Practitioner Company
Capital One made a great article gathering 10 key strategies for optimizing cloud costs:
Monitoring and cost visibility: Track how cloud resources are used and their costs. This provides insights to identify underutilized resources or cost anomalies.
Rightsizing resources: Match the size and type of cloud resources to actual needs. This avoids overpaying for unused capacity.
Using reserved instances: Purchase reserved capacity at a discount for predictable workloads.
Implementing auto-scaling: Automatically adjust resources based on demand to avoid over-provisioning.
Optimizing storage: Use tiered storage options and remove unnecessary data.
Managing network costs: Monitor data transfer and optimize network configurations.
Utilizing spot instances: Use spare computing capacity at steep discounts for flexible workloads.
Implementing governance policies: Set spending limits and approval processes.
Optimizing licensing: Review software licenses to avoid unnecessary costs.
Using cost management tools: Leverage cloud providers and third-party tools to analyze and optimize spending.
Implementing these strategies can help organizations make the most of their cloud investments by preventing overspending and improving resource allocation. Regular monitoring and optimization are key to maintaining cost efficiency as cloud usage evolves.
🏆 Quick Wins
Announcements
AWS WAF's console dashboard now has new features to help you see traffic better. with the new top insights section.
Amazon has introduced a new feature called Amazon EKS Hybrid Nodes. This allows companies to connect their own computers and servers to Amazon's cloud-based Kubernetes system.
Articles & Podcasts
The ITAM FORUM has published an article discussing the need for IT Asset Management (ITAM) to evolve. This topic has sparked a debate about how ITAM and FinOps might work together, especially regarding Software as a Service (SaaS) management.
Professional Spotlight
Sonal Gupta
Brewing FinOps Practices at Carlsberg
It was a pleasure to meet Sonal in FinOps XE and have a brief talk. She’s one of the most valuable FinOps Practitioners I talked in there. She knows her stuff, someone to learn a lot from. Check out her talks!
Action Items: Read today’s newsletter, and give feedback about FinOps Weekly
That’s all for this week. See you next Sunday!
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