Cost

At AWS re:Invent 2023, Amazon CTO Werner Vogels delivered a talk on the laws of frugal architecture. While I initially filed away those insights to review later, a year of cloud architecture experience crystallized a fundamental truth: in cloud computing, cost isn’t just a financial consideration — it is a first-class architectural concern through which we should design and optimize our systems. Cloud providers charge for every conceivable resource: servers, API calls, data transfer, and computational milliseconds. But cost is more than just a line item on a monthly bill, it is a powerful forcing function that drives better architectural decisions. ...

One of the realities of running a business is that you will — at some point — need to make money. This means you must sell something for more than it cost to make it. Profit = Total Revenue - Total Expenses So, to sell a service or feature (like a third-party API portal) at a profit, we need to understand how much it costs to make it, so we know how much to sell it for. In business parlance, the quantity we are looking for is the cost of goods sold — the accumulated costs used to create a good, including direct labor, materials, and any overhead. ...