# Cloud Cost Optimization

## Overview

Cloud cost optimization reduces spending while maintaining performance and functionality. This guide covers strategies for rightsizing, reservations, monitoring, and cost allocation.

## Cost Optimization Strategies

### Rightsizing

**Match Resources to Workloads:**
- Analyze actual usage
- Downsize over-provisioned resources
- Upsize under-provisioned resources
- Use auto-scaling

**Tools:**
- AWS Cost Explorer
- Google Cloud Recommender
- Azure Cost Management

### Reserved Instances

**Commitment Discounts:**
- 1-3 year commitments
- Significant discounts (up to 75%)
- Predictable workloads
- All Upfront, Partial Upfront, No Upfront

### Spot Instances

**Interruptible Resources:**
- Up to 90% discount
- For fault-tolerant workloads
- Batch processing
- Auto-scaling groups

### Auto-Scaling

**Match Demand:**
- Scale up during peaks
- Scale down during valleys
- Reduce idle resources
- Cost-effective scaling

### Serverless

**Pay Per Use:**
- Only pay for execution time
- No idle costs
- Auto-scaling included
- Event-driven workloads

## Monitoring and Tagging

### Resource Tagging

**Cost Allocation:**
```json
{
  "Environment": "production",
  "Team": "backend",
  "Project": "user-service",
  "CostCenter": "engineering"
}
```

### Cost Monitoring

**Track Spending:**
- Daily, weekly, monthly reports
- Budget alerts
- Anomaly detection
- Department allocation

### Cost Dashboards

**Visualize Spending:**
- By service
- By team
- By environment
- Trends over time

## Optimization Patterns

### Storage Optimization

**Choose Right Storage:**
- Hot data: Premium storage
- Warm data: Standard storage
- Cold data: Archive storage
- Delete unused data

### Network Optimization

**Reduce Data Transfer:**
- Use CDN for static content
- Minimize cross-region transfer
- Compress data
- Cache responses

### Compute Optimization

**Efficient Resource Usage:**
- Use appropriate instance types
- Containerize for efficiency
- Optimize application code
- Use spot instances for batch

## Best Practices

1. **Tag Resources:** For cost allocation
2. **Monitor Regularly:** Track spending trends
3. **Set Budgets:** Alert on overspending
4. **Review Monthly:** Identify optimization opportunities
5. **Use Reserved Instances:** For predictable workloads
6. **Right-size Resources:** Match to actual usage
7. **Delete Unused:** Clean up orphaned resources
8. **Use Auto-scaling:** Match demand
9. **Choose Appropriate Storage:** Tier by access pattern
10. **Review Pricing Models:** Optimize per workload

