Hey HN: Kaveh here, the founder of https://www.usage.ai/<p>We launched on Hacker News for the first time early last year, and we've made a lot of progress since then. We've saved tens of millions of dollars for companies, and we are even more excited to announce the launch of a new product: insured reservations for RDS! We worked closely with AWS on this feature and are excited to finally make it generally available.<p>We help companies drive down AWS EC2 & RDS spend. Why? Because the way it's done now is a pain. DevOps and Software Engineers end up spending time managing costs and reservations rather than focusing on business problems.<p>In the early days, we saw horror stories of customers with millions of dollars in monthly on-demand spend simply because their finance team didn't want them committing to AWS. Worst yet, we've seen AWS users who ended up overspending by hundreds of thousands of dollars a month because they overcommitted their Savings Plan commitment.<p>Here's how it works: We are typically brought in by a DevOps manager to cut AWS EC2 costs. The app is entirely self-service and the savings are generated automatically, typically we do this live on a call. On average, we reduce AWS EC2 spend by 50% for 5 minutes of work, and RDS spend by ~30%.<p>To reduce by 50%+, we don't touch the instances, require any code change, or change the performance of your instances. We buy Reserved Instances on your behalf (a billing layer change only) and bundle them with guaranteed buyback. So you get the steep 57% savings of 3-year no-upfront RIs with none of the commitment.<p>We make money off of a 20% Savings Fee. Happy to chat directly kaveh@usage.ai<p>Have you experienced any issues with managing your company or organization's AWS expenses? We'd love to hear your feedback and ideas!
> We buy Reserved Instances on your behalf (a billing layer change only) and bundle them with guaranteed buyback<p>This is by setting your AWS account as the payer account so you can aggregate? I’m curious how the finances will work out - at least one of them had challenges balancing their RIs with customer changes since there wasn’t a feedback cue for developers not to change instance types casually.<p>On a marketing level, I have an instinctive negative reaction to the claims like the title here has because I know it’s not true for me (my accounts are dominated by storage and network egress so even if EC2 were free you couldn’t get 57%). I’m wondering how best to phrase it to help people understand they can save a lot but not make it seem like you’re misrepresenting the possibilities. It’d also be useful to compare with compute savings plans.
This is like insurance in a couple of different ways, and makes me happy, but concerned. usage.ai is basically taking a bet that a large number of their customers wont cut back on RDS spend simultaneously.<p>AWS massively made RDS instances cheaper when they released RDS on Graviton. I can only imagine that'd nearly put a company like usage.ai out of business. I'm curious what defense mechanism they have against this.
We've just taken over a platform for a client whose previous partner almost drove them bankrupt with insane AWS charges, support costs and so on.<p>Most of their initial funding got burnt on charges that didn't relate to developing or marketing a product.<p>AWS is just a horrible product for smaller companies.
How does this differ with Vantage Autopilot <a href="https://www.vantage.sh/features/autopilot" rel="nofollow">https://www.vantage.sh/features/autopilot</a> ?
Looks really good.<p>I have been offered large discounts by an AWS reseller, and I have not understood exactly how or why they can do this. Are the resellers doing what you are doing but being less transparent about it?
Interesting, the financialization of reserved instances. So, effectively, this ends up being similar to you buying reserved instances then renting them out to customers, taking advantage of the market inefficiency inherent in the pricing difference between reserved and non-reserved instances?
I'm on a recommendation, it shows reservation 48.28% and $24.53 Lowest Risk then has a line of text that says "Select a recommendation to compare it to actual resource utilitzation"<p>three things, what does select a recommendation to compare it to mean? I'm not sure what I should be selecting. And second, is it utilitzation or utilization? Or is that word like canceled and cancelled ?<p>and the third thing, when approving, I see total savings of $24.53 and by selecting approve, you'll be charged with 20% of realized savings monthly. Should this give me some idea of how much this will cost ?<p>I would think its $24.53/12 = $2.44 * .2 = $0.488<p>Is that correct?
> We buy Reserved Instances on your behalf (a billing layer change only)<p>> and bundle them with guaranteed buyback.<p>> .. We make money off of a 20% Savings Fee.<p>so this is similar business model, like <a href="https://archera.ai/guaranteed-reserved-instances/" rel="nofollow">https://archera.ai/guaranteed-reserved-instances/</a><p><i>"Find big-time savings with short-time commitments.
Unlike typical commitments, Guaranteed Reserved Instances can be sold back to Archera within a month of initial purchase and with higher savings than standard offerings."</i>
How does the buyback program work for your new releases (RDS, Elasticache, OpenSearch, DynamoDB)? I use the EC2 RI Marketplace but I can't find one for the other products mentioned.<p>Also, I just reviewed your T&C and your "Program" states that you provide "Non-Usage Credits". What does this mean? I don't have any guarantee that in an off-scenario where there is an overload of RIs being sold I'll stop paying for them. I'd rather use Vantage and pay a 5% fee on my RIs.
How does this compare to what's offered by doit? <a href="https://www.doit.com/flexsave/" rel="nofollow">https://www.doit.com/flexsave/</a><p>From my conversations with doit sounds like they offer a similar service in that doit acts as an AWS reseller (~~some billing magic) and they apply commitment discounts etc. and pass along a portion of the savings. doit also claim to throw in free cloud architecture and support consulting services as a value add.
This sounds very cool! How does it work technically? I have checked your website but I am still not sure.<p>How do I "buy" the instances using usage.ai instead of AWS? Do you need additional tooling or does it work with awscli/terraform? How do you integrate with my account and how do "your instances" appear in my account and how can I sell it back?<p>As far as I understand, I can buy/sell reserved instances from you in a flexible way, so they can be used like on-demand instances.
Anyone have insight into why AWS hasn’t offered 6 series instance types for Oracle RDS with license included? The conventional wisdom that a new instance type will improve dollar per unit if performance year over year is breaking down in this case.<p>I could guess that Oracle licensing changes or negotiation has made it untenable for AWS.
For my own curiosity, what's the benefit of a one-time engagement with Usage AI over a continuing engagement with a tool (plus proserv, if merited) like CloudHealth? Much of the trouble with AWS spend is due to deltas as the platform changes, rather than a single realization that AWS costs too much.<p>(Disclaimer: I was an engineer at CloudHealth four years ago.)
Former AWS employee here, and just generally been in the infra/cloud space for a long time. I've seen a few of these products (or this feature within existing products) over the years. The things that always gives me an extreme amount of pause, and why I'd never personally be willing to pursue this as a startup myself, are:<p>* Amazon in general is famous for using scale to drive down costs and/or attack the margin of competitors. So much so that a Bezos quote of "your margin is my opportunity" regularly gets thrown around. This is a direct attack on what is essentially fat AWS margin. Which isn't itself bad. Maybe they've grown complacent and lazy? It does worry me though when the strategy is essentially taking on the reigning champion by using their own game against them, where they both have the home ground advantage and get to set the rules. You're one feature/packaging/pricing change away from becoming irrelevant.<p>* The huge information asymmetry. AWS can see _all_ the data. They have entire teams dedicated to building models around it. They know who should be on RIs, for what term, the impact to both them and customers. For even the most moderate sized customers and above there are people who have a KPI on driving RI usage + cost reductions into those accounts. How much opportunity is there really? Prospects who have the most to gain from this should theoretically have SAs/TAMs/etc. telling them every month to take these actions. They've either done the low-hanging fruit already or aren't interested because of other competing priorities. I'm not sure another third-party tool changes those things.<p>* The black swan risk of the insurance-like underwriting of carrying RIs. The models for all of these when I've looked into them meant there was tail risk around a large number of customer simultaneously deciding to hand back their RIs. And there's a lot of reasonable justification to believe that's unlikely. It also doesn't feel like a massive stretch of the imagination to think that a change in macro conditions + a shift to a far more aggressive red ocean strategy + a new instance family + AWS' history of discounting new instances on a $/performance basis to encourage adoption/migration = a huge price drop to drive both competitive and architecture migration en masse. The value of the RIs for what's now considered "legacy compute" would plummet overnight.<p>All that skepticism aside, the things I continually find most interesting in this space are the general usability and UX improvements. AWS consistently has a pretty suboptimal user experience, and the billing aspects in-particular can be indecipherable at even a trivial level of scale. So maybe the opportunity here is less about attacking margin and more about the fact customers are leaving money on the table purely because AWS make it so dang hard understand and improve things?
How would you describe the mechanics of this in regular finance terms... Almost like you are providing mortgages for reserved instances?<p>I think I understand the model here, but I guess I'm curious how you model in risk of suddenly getting stuck with a bunch of 3 year RI commitments?
I recently found out that I was overpaying by about 20% by just looking at "Recommendations" tab in AWS Console and buying RIs. It was mostly RDS.<p>I would love a product that automatically manages the RI renewals (ex. every year) and instance type changes.
Curious what happens to resources and reservations if Usage goes out of business? Three years is actually a pretty long horizon to rely on a startup still being around.