Reading AWS Pricing: Cost Drivers and a Worked Example in USD

Where the money goes

• Compute (EC2, Fargate, Lambda): usually the largest line, driven by instance hours and instance size.
• Storage (S3, EBS): cheap per gigabyte, but it accumulates when retained data is never reviewed.
• Data transfer and CDN: priced per gigabyte, and the line finance most often questions.
• Managed databases (RDS, Aurora): the managed layer is billed on top of the underlying instance.
• Support plan fees and taxes sit outside the usage lines, so model them separately.

How to make it predictable, with a worked example

The rates below are round numbers for illustration. Replace them with the list price for your region on the day you quote.

• Compute: three instances running all month (730 hours each), at $0.20 per instance-hour.
• Storage: 2,000 GB retained, at $0.02 per GB-month.
• Data transfer out: 5,000 GB to the internet, at $0.085 per GB.

Changing one assumption moves the total in a predictable way. If compute hours fall by 10 percent, for example by switching non-production instances off overnight, the compute line drops by $44. If outbound transfer falls by 1 TB, the total drops by $85. Build the model so that each line can be changed on its own.

A reseller discount applies to specific lines, not to the bill as a whole. TiCON publishes a typical range: compute and storage (EC2, S3, RDS, EKS) usually 15 to 35 percent below AWS list, and CloudFront bandwidth up to 40 percent lower. These are estimates, not quotes. Applied only to the compute line in the example, 15 to 35 percent is $66 to $153 a month. Budget from the quote's figure, not from the range.

How it is billed, and what to check in a quote

Quotes are in USD and quote-based. Other currencies are by contract, so ask before you sign. Check the following in any quote:

• Line items in USD, with the pricing assumptions stated: region, instance hours, gigabytes and commitment term.
• Whether a discount applies to each line or only to the total.
• Whether support fees, data transfer and any minimum charge are included or excluded.
• The commitment terms, and what happens to the bill if usage falls.
• Taxes, applied as applicable in your jurisdiction and the contract, and shown on the invoice.
• The invoice format and currency.

Ask for the calculation behind any discount, a sample invoice from a comparable account with identifiers removed, and the partner's listing in the provider's partner directory. For AWS, the AWS Partner Finder is the place to confirm a partner's status.

This page is a method, not a price list. AWS list prices change and differ by region, and the rates above are illustrative assumptions rather than published AWS prices.

Related reading

[How to Reduce Your AWS Bill: 6 Tactics That Work](/resources/blog/how-to-reduce-your-aws-bill) Tagging, rightsizing, commitments, idle cleanup, storage tiers and data transfer, with what each one needs from your team.

[Opening and Paying for an AWS Account Properly](/resources/blog/open-pay-aws-account) Account setup and payment routes, compared, so the contracting entity is clear before the first invoice.

[Choosing an AWS Region: Latency, Residency, Price and Services](/resources/blog/aws-region-nearest) How the region choice changes both price and data rules.