Welcome to your very first Lecture “Understand how AWS Billing works.” Here we’ll give you the basics you need to understand AWS Billing.

We take you on a journey through the development from the classic data center to today's public cloud. 

In addition to important information about the modern Cloud Economy, we also show you the problems with the Public Cloud. 

Cloud costs affect everyone, so it is important that IT, Finance, and Executive Departments understand each other. We convey the most important terminology from these areas and ensure mutual understanding. 

Even though we are fans of practical learning, this will be a theoretical lesson to lay the foundations for the rest of the course.

Please join me into the first lecture.

Let's take a look at where we actually come from. Until the year 2006, companies still relied on their own IT. IT costs were fixed, also called Capital Expenses or CapEx. 

That has changed with the move to the cloud. IT and cloud costs are now much more variable and difficult to plan than before. We have moved to operational expenses, also known as OpEx. No worries if you don’t know exactly what these terms mean, we’ll cover them later.

We are currently at a tipping point where more is already being spent on cloud resources than on-premise. And the trend is rising. Forecasts predict that by 2022 we will have a total cloud spend of around 360 billion dollars.

In addition to many advantages, the cloud also has its downsides and we can see what these are in this graphic. At re:Invent 2019 310 business and IT executives were asked where their biggest problems lie in cloud operations. 

The graphic speaks for itself, 29% stated that cost management is their biggest challenge. 

This is still underpinned by a survey by Gartner. According to the survey, 80% of companies will overrun their Infrastructure as a service budget in 2020. 

Reason enough to bring the knowledge about cloud cost optimization to the world, right?

Working in the Cloud comes with many benefits and variable expense control. However, due to the often new and unfamiliar environment, many users end up with paying more and struggling with cost management.