The REAL Cost Of AWS (And How To Avoid It)

Summary

In this video, the speaker addresses concerns about the cost of recommended services for small projects and startups, arguing that they are more cost-effective than AWS. They highlight generous free tiers, the hidden costs of in-house development, and the time-saving benefits of using these services. The speaker emphasizes that these tools not only save time but also reduce costs through efficient scaling and caching, ultimately providing a better return on investment for businesses.

Takeaways

• 💡 The services recommended have very generous free tiers, which can accommodate small projects and startups without incurring costs.
• 📊 The cost of setting up and maintaining infrastructure on AWS can be high in terms of time and effort, which is often overlooked when considering 'cheaper' alternatives.
• 💼 Engineers may undervalue their time, but the time spent on setup and maintenance can be significant and costly for a company.
• 🔒 Job security can be a factor when using complex, self-hosted solutions, as it can be challenging to find a replacement with the same setup knowledge.
• 💼 For companies, especially startups, it's more cost-effective to focus on developing unique business features rather than optimizing AWS costs.
• 🚀 Services like Vercel, PlanetScale, Clerk, and others offer benefits like 'scale to zero', which means you only pay for the resources you actively use.
• 💰 These services can lead to actual cost savings by allowing for efficient scaling, caching, and reduced need for server maintenance.
• 🛠️ Using services like Vercel's edge functions can significantly reduce compute costs due to their低廉的 invocation pricing and caching capabilities.
• 💡 The speaker emphasizes that these services are recommended based on their time, money, and energy-saving benefits, not because of sponsorships.
• 💼 The speaker challenges the notion that self-hosting is always cheaper, arguing that it often costs more in the long run due to the complexity and maintenance involved.

Q & A

What is the main concern people have about the services recommended on the channel?

People are concerned that the services recommended are more expensive than using AWS directly, especially for low budget teams.

How does the speaker refute the claim that AWS is cheaper?

The speaker refutes this by explaining the generous free tiers of the services recommended, the cost savings in terms of developer time, and the actual cost savings due to the services' features.

What is the significance of the free tier for services like PlanetScale?

The free tier for services like PlanetScale is very generous, offering a billion row reads and 10 million row writes per month for free, which is more than enough for many small projects.

How much does it cost to go over the free tier limits on PlanetScale?

If you go over the free tier limits on PlanetScale, it costs one dollar per billion reads and one dollar and fifty cents per million writes.

What is the speaker's opinion on the pricing of services like Clerk compared to Auth0?

The speaker believes that the pricing of Clerk is very similar to professional solutions like Auth0, with a hobby tier that is affordable and doesn't require a credit card.

Why is the time spent by engineers setting up and maintaining services considered expensive?

The time spent by engineers is considered expensive because it can take days or weeks to solve problems and set up services like CI/CD, databases, and serverless traffic handling, which translates to a significant cost in terms of lost productivity.

What is the benefit of using recommended services in terms of job security?

Using recommended services can increase job security because the complex setup an engineer creates becomes reliant on their expertise, making it harder to replace them.

What is the speaker's advice for companies regarding the cost of developer time?

The speaker advises companies to understand the value of their engineers' time and to let them focus on tasks that drive unique business differentiators rather than optimizing AWS costs.

How do services like Vercel and PlanetScale help in reducing actual costs?

Services like Vercel and PlanetScale help reduce costs by allowing scale to zero, meaning you only pay for the compute you use, and by providing features that minimize the need for unused compute.

What is the cost of using Vercel's edge functions in the pro tier?

The cost of using Vercel's edge functions in the pro tier is 65 cents per million invocations.

Why does the speaker recommend services like Vercel, PlanetScale, Clerk, and others?

The speaker recommends these services because they save time, money, and energy, and make it faster to develop the right solution for users at any scale.

Outlines

00:00

💸 The Generosity of Free Tiers

The speaker addresses concerns about the cost of services recommended on the channel, particularly for low-budget teams. They argue that the free tiers of recommended services are very generous, allowing extensive use without charge. They give the example of Versel's free tier, which offers a billion row reads and 10 million row writes per month for free. Even when upgrading to a paid plan, the cost remains minimal, with Versel charging only one dollar per billion reads and one dollar and fifty cents per million writes after the free tier is exceeded. The speaker emphasizes that the cost savings from these services are significant and that their recommendation is based on the value they provide, not on margin.

05:01

🕒 The True Cost of DIY Solutions

The speaker discusses the hidden costs of setting up and maintaining infrastructure using AWS directly, as opposed to using recommended services. They highlight that engineers often undervalue their time, which can be costly when spent on tasks like setting up CI/CD, configuring databases, and managing serverless traffic. The speaker shares personal experiences of spending significant time on such tasks, which could have been better used for developing unique business solutions. They argue that the time saved by using recommended services is valuable and can lead to significant cost savings, especially when considering the high cost of change in most companies. The speaker suggests that the cost of maintaining complex setups can outweigh the minor savings of using AWS directly.

Keywords

💡Free Tier

The 'Free Tier' refers to the basic level of service provided by cloud platforms without charge, often used to attract new users. In the video, the speaker emphasizes the generosity of the free tiers offered by services like Vercel and PlanetScale, which allow for extensive usage without cost, thus being particularly beneficial for low-budget teams and side projects. The script mentions that Vercel's free tier offers a billion row reads and 10 million row writes per month, which is 'disgustingly generous' and can accommodate many small-scale projects without incurring charges.

💡PlanetScale

PlanetScale is a database service mentioned in the script that provides a very generous free tier and is designed to scale efficiently. The speaker argues that PlanetScale's pricing model, which includes a low cost per billion reads after the free tier is exhausted, makes it an economically viable option for developers. The service's ability to scale databases properly and pass on cost savings to users is highlighted as a key advantage.

💡Clerk

Clerk is a service that provides backend functionality, and it is compared to other professional solutions like Auth0 in the video. The speaker discusses Clerk's pricing structure, which includes a 'hobby tier' for small-scale usage and overage pricing for larger user bases. Clerk's approach to pricing and its focus on providing a developer-friendly experience are emphasized as reasons why it can be more cost-effective than self-hosted alternatives.

💡CI/CD

CI/CD stands for Continuous Integration and Continuous Deployment, which are practices that help automate the software development process. The video script points out the time and effort required to set up CI/CD correctly, which can be significant. The speaker argues that using services that simplify CI/CD can save developers hundreds of hours, which translates to substantial cost savings for the company, even if there is a monthly fee for the service.

💡Serverless

Serverless computing is a cloud computing execution model where the cloud provider dynamically manages the allocation and provisioning of servers. The script mentions serverless as a way to save costs because you only pay for the compute time you use, rather than paying for idle servers. This is particularly relevant when discussing services like Vercel and PlanetScale, which allow for 'scale to zero', meaning no cost when there's no usage.

💡Edge Functions

Edge Functions refer to running code in a decentralized manner, close to the user to reduce latency. In the video, the speaker discusses how using edge functions can be cost-effective because they are only invoked when necessary and can leverage caching to minimize compute costs. Vercel's edge pricing is given as an example, where the cost is very low per million invocations, highlighting the efficiency of this approach.

💡Caching

Caching is the temporary storage of frequently accessed data to improve performance and reduce latency. The video script explains how caching can significantly reduce compute costs, as it prevents the need to process the same data repeatedly. The speaker uses Vercel's caching primitives as an example, where responses are cached, and compute is only used when there's a change or specific user interaction.

💡Job Security

Job security in the context of the video refers to the stability and longevity of a job role. The speaker suggests that by setting up complex, self-hosted systems, engineers inadvertently create job security for themselves because their expertise becomes necessary to maintain those systems. However, this can be counterproductive for companies as it ties up valuable engineering time in maintenance rather than innovation.

💡Cost of Change

The 'cost of change' is the effort and resources required to modify or update a system. In the video, the speaker argues that the cost of change is high when using self-hosted solutions, as any change can require significant reconfiguration and maintenance. This contrasts with using services that abstract away complexity, allowing for easier and less costly changes.

💡Developer Experience

Developer experience (DX) refers to the tools, services, and practices that make it easy and efficient for developers to build software. The video emphasizes the importance of a good DX, as it can save engineers' time and enable them to focus on creating unique business value. The speaker argues that services like Vercel, PlanetScale, and Clerk enhance DX, making them more cost-effective in the long run by allowing developers to build and iterate faster.

Highlights

Services recommended have a very generous free tier, which can be used for a long time.

Planet Scale's free tier offers a billion row reads and 10 million row writes per month for free.

Upgrading to Planet Scale's $30/month plan increases the free tier benefits significantly.

The cost for exceeding the free tier on Planet Scale is very low, at $1 per billion reads and $1.50 per million writes.

Planet Scale's pricing model is based on database usage rather than reads and writes, making it very cost-effective.

Planet Scale passes on cost savings to customers by focusing on upselling additional features and developer experience.

Clerk's pricing is similar to other professional solutions like Auth0, with a hobby tier starting at $25/month.

Clerk's free tier allows unlimited sign-ins without a credit card, up to 5,000 users in a month.

Additional users on Clerk are priced at two cents each in the hobby tier and five cents in the business tier.

The cost of setting up and maintaining infrastructure like CI/CD and databases can be time-consuming and expensive.

The time spent on setup and maintenance can be hundreds of hours, which is a significant cost.

Using recommended services can save time and money, as they are designed to be cost-effective and efficient.

Services like Vercel and Planet Scale allow for scaling to zero, meaning no cost for unused compute.

Using services that scale based on usage can lead to significant cost savings compared to self-hosted solutions.

Edge functions can be extremely cost-effective, with Vercel's pro tier pricing at $0.65 per million invocations.

Caching and CDN setup can save a lot of compute costs and are part of the recommended services' benefits.

The recommended services not only save time but also lead to actual cost savings through efficient billing mechanisms and features.

Self-hosting backends and services should be done only if there's a strong reason, as it's usually more expensive.

The speaker emphasizes the importance of understanding the true cost of engineering time and the value of developer experience.

Transcripts

I keep hearing concern about the cost of

the services I recommend on the channel

in particular for low budget teams

trying to spin up side projects small

apps and all sorts of things saying it's

cheaper to use AWS directly and not to

use the tech that I recommend and that's

fine you're wrong in three ways and I

want to talk about those so let's do it

the first one is how long you can get

away with the free tier for almost all

the services I recommend have a very

very generous free tier like

disgustingly generous I've not shipped a

service to date that doesn't fit within

versel's free tier even the stuff y'all

spam when I post it Planet Skills free

tier gives you a billion row reads a

month and 10 million row rights a month

for free and when you upgrade to the 30

a month plan that becomes a hundred

billion reads and 50 million rights do

you want to know how much it costs if

you somehow go over one dollar per

billion reads afterwards and one dollar

and fifty cents per million rights

thereafter that's insane Planet scale is

effectively free your build on how many

databases you host not on your reads and

rights it's insane how cheap Planet

scale is when you scale your databases

properly they become cheap and they're

passing the cost savings on because they

can make their money on the Enterprise

scale Planet scale doesn't win based on

how much margin they make on their

servers per compute they win based on

how much they can upsell you on the

additional features in developer

experience that they provide they found

a technical win and they scale developer

experience on top and the result is just

really really hard to beat and if we

look at the other services that I

recommend stuff like clerk the pricing

is very similar to other professional

Solutions like auth zero they have a

hobby tier 25 bucks a month that isn't

limited to the 5 000 monthly active

users of the free tier yes that's right

no credit card unlimited sign-ins but up

to 5 000 users can exist in a given

month and they have pricing for overage

yeah included monthly active users

they're active if they've visited and

then it's two cents for each additional

user at the hobby tier

five cents for the business tier because

they have a bunch of additional features

integrated and they have obviously

discounts if you do like big business

stuff each additional employee that you

have working inside of the clerk

dashboard is initial 20 bucks but you

probably don't need too many of those

because you can just share the

environment variables and everyone's

good to go it's

pretty cheap like your free tier window

is massive and the rest is super cheap

as well the same goes for upstash and

Axiom I don't need to go into all the

details of all of these the point I'm

trying to make is very specifically the

free tier carries you really far so what

are these other two points the next one

I want to focus in on is how expensive

you are it's easy for us as Engineers to

think of our time as cheap because it's

ours and we can spend it however we want

but when it comes to stuff like setting

up CI and CD correctly or connecting

your database in setting up your PG

bouncer to handle serverless traffic the

types of problems I dealt with when I

was using AWS myself took time to solve

sometimes days sometimes weeks always

including a lot of Maintenance long term

and the amount of time I have lost

setting up PG bouncers switching

databases between platforms figuring out

how appsync or amplify and all these

other things work and trying to get CI

CD linked to GitHub properly is insane

we're talking hundreds upon hundreds of

hours and whether or not I like to admit

it that's expensive if I'm doing that

for a company that's more expensive

there is a benefit here

job security if I have all of this

effort I've put into setting everything

up and now I have this complex setup

that we rely on if I then decide to

leave I have to put a lot of work in

finding a replacement who can maintain

whatever chaos I have set up there if

the benefit there is a few less cents a

month per whatever depends on how many

whatevers there are before that number

matters other extremes have talked about

the line of prime the point at which a

service is stable enough in its feature

set and trafficked enough and its usage

patterns where it makes sense to rewrite

it in a stable self-hosted thing to

really try and minimize cost but most of

us are very far from that point even

y'all working at big companies because

most code is changing and the cost of

change is high I would venture to bet

that the majority of the companies y'all

work at it would be more expensive for

the company to pay you to build versus

developer experience than to pay for

sell to use their existing experience

and the same goes for everything we

recommend on this channel these tools

save real amounts of time and that time

might not be valuable to you in your

head as a developer but for me as a team

lead and a person who runs companies and

also invests in companies it's important

to understand how valuable your

engineer's time is so that your

engineers can use that time in things

that drive unique business

differentiators your engineer should be

spending time making your product better

for your users so you can beat your

competition not making your AWS cheaper

so that you can feel good about yourself

and your job security at night as you're

paid 200k a year to save the company 100

bucks a month but we're not even at the

most important thing these Services

actually save money I'm not talking time

saved money I'm not talking free to your

money I'm talking the actual benefits of

these Services allow you to build things

that run at cheaper costs the first

thing is scale to zero you're not paying

for compute you're not using if you set

up your kubernetes and your terraform

and everything correctly you can

minimize how much compute you're paying

for that goes unused but if you're

spinning up servers then your running

server first and if you're running

servers you're paying for a compute that

isn't being used period you use services

like for sale and Planet scale you're

not paying when the month ends you're

paying when the users use the service

and that billing mechanism makes it much

easier to flex your costs based on usage

of every single part of what you're

building it is significantly easier to

scale your pricing based on the scale of

your application rather than spinning up

things and letting them sit and paying

for a bunch of servers you're not

actually using on top of that you can

save a ton of compute using things like

versel's cache Primitives and

incremental static regeneration only

actually Computing on the server when

things have changed or on planet scale

using database.js package to hit their

HTTP endpoint instead of making a SQL

connection meaning you can avoid setting

up pools and bouncers and all these

other things you normally have to set up

to maintain your connection to your

database you can just hit it from an

edge function and Edge functions are

hilariously cheap like let's just go

look at Versailles pricing quick for

sales edge pricing on the pro tier is 65

cents per million invocations that means

every million times your Edge function

runs it costs you 65 cents and it only

runs if it doesn't have data in the

cache already so if you're caching your

responses and you're only invalidating

them on user requests or specifically

interactions like I'm only going to

update the posts on my profile on

Twitter when I make a new post then

every other request is hitting a cache

and not actually running compute at all

it's so much cheaper to Cache a response

than to run a server that processes

every single request like comically so

in setting up your caching and your CDN

all that stuff correctly goes back into

the second category of cost savings

where you're paying your engineers a lot

of money to get that all set up and

maintained correctly the benefit of

versel in Planet scale and Clerk and

Axiom and upstash and all the other T3

deploy Partners who are not paying me to

make this video to be very very clear

the reason I recommended them before

they paid me is because they saved me

time money and energy they made it

faster for me to develop the right

solution for my users at every scale

I've ever worked at and I feel like when

you all say these things are too

expensive you don't actually see where

the cost is so I hope this is helpful

and y'all having a slightly better

understanding of why these services are

indeed cheaper than your AWS based

Alternatives and if you're hosting your

own backends and you're hosting your own

Services you better have a damn good

reason because you are costing more

money the vast majority of the time I

hope this was helpful I've been holding

this rant in for a while and I think it

shows with how it came out let me know

what you thought about it I'm I'm gonna

love the comment section on this one I'm

sure you want to hear more about all the

info I use and recommend I'll pin that

video right here I put a lot of effort

into that one so please check it out

thank you as always peace nerds