Given the current operating conditions, it is even more important to take every opportunity to maximise the efficient operation of our systems and services, so that any cost benefit can go back into the railway

Steve Wright
Head of Services & Assurance, Rail Delivery Group

 

The Rail Delivery Group (RDG) have a large AWS estate managed by KCOM and with the overarching conditions as a result of COVID-19 this has presented cost challenges resulting in governance and management being high up on the organizations focus areas. With the existing reserved instance plans which KCOM had put in place for RDG, due to expire in July 2020, it was an ideal opportunity to review and investigate whether Amazon Web Services (AWS) new Cost Saving Plans could replace or augment potential AWS cost optimisation benefits.

Here’s how we did it…

RDG and KCOM

 The Rail Delivery Group (RDG) brings together the companies that run Britain’s railway into a single team with one goal - to deliver a better railway for its passengers and their communities.

RDG have a long standing and trusted relationship with KCOM both for their expertise in managing AWS cloud hosted services. KCOM also provides a wider managed service for RDG’s National Rail Enquiry (NRE) service including provision of a service desk function as well acting as the Systems Integration and Management (SIAM) function.

Challenge

With the impact of the COVID-19 pandemic on the Rail industry in terms of reduction in passenger numbers and consequently ticket revenue the already important area of cost optimisation moved from being important to crucial for RDG.

Whilst AWS cost saving options were already in place for part of the RDG NRE services utilising reserved instances, there was still more that KCOM as a trusted partner could do. However, the scope and type of cost savings that could be utilised was complex and intricate so there had to be demonstrability benefical outcome for the customer for them to realise a good return on investment. There was also the added complication of multiple third parties utilising the KCOM managed AWS estate making future growth and utilization difficult to predict.

With the existing RI expiring it was evident that a solution was developed and agreed prior to the expiration to prevent any increase in costs even for a short period.

Solution

The solution needed to appreciate and deliver against the following inputs:

  • Historical analysis of AWS consumption – A detailed review of the RDG services in terms of AWS consumption was required to identify trends and appropriate spread of cost saving coverage. This included instance type, location, OS flavour and the probability that it might be migrated or changed in the future – so the customer roadmap needed to be understood where possible, or a calculated risk made.
  • Flexibility – Whilst the AWS Reserved Instance plans provided a good level of discount on EC2 compute costs they did not have the required level of flexibility to ensure the savings were always optimised. The new cost optimisation approach needed to provide a simpler way to ensure cost savings were transferable to be adaptable to change within the estate. KCOM determined that a hybrid approach of Reserved Instance and Cost Saving plans would provide the best approach to balance out cost savings and flexibility to change as required in the future.
  • Optimal Application – The range of potential applications for Reserved Instance and Cost Saving plans is vast and navigating the best approach was complex and convoluted. KCOM used expertise in FinOps, AWS and close working relationships with RDG and its other suppliers to form the best approach to the optimal application of AWS cost savings options.
  • Customer and Supplier Engagement – Through KCOM interactions with both RDG and its suppliers a forecast of future growth and reduction for specific areas of the estate was compiled.

With such a wide variety of options available from AWS utilising Reserved Instances, Cost Saving Plans and multiple payment options with varying level of discounts it was important that KCOM presented the relevant options and recommendations, as a trusted partner to RDG.

The approach taken was that all instances which would remain immutable over the coming year due to size, risk of migration or static workload would be fully covered by Reserved Instance plans. For any instance likely to change in their demand profile due to growth, cost optimisation activities or as likely candidates for instance family moves the more flexible approach of cost saving plans was selected.

KCOM correlated all the information and presented it to RDG with predicted costs and savings utilising full, partial and no upfront payment options offered by AWS.

Results

We were able to provide RDG with significant cost savings compared to on demand costs on their AWS consumption over the coming year alongside the flexibility to grow and change their AWS estate to meet demand and future developments.

  • RDG opted for a full upfront payment for the KCOM proposed AWS Reserved Instance and Cost Saving plans presenting them with estimated EC2 compute cost saving of circa 30% in comparison to the previous year.
  • The addition of Cost Saving Plans provided greater flexibility for future changes within the RDG AWS estate without risk of the plans becoming orphaned.

RDG oversees a complex set of back office systems and services which are run by a number of different suppliers, so trying to maximise the efficient operation of them in terms of AWS usage can be a challenge. KCOM undertook the required analysis during the Covid-19 period against tight timescales and presented clear options back to RDG, so we could make an informed decision. Ultimately it could allow us to achieve estimated compute cost savings of circa 30% compared to the previous year

Simon Wright
Head of Services & Assurance, Rail Delivery Group