Monitoring Application Performance with X-Ray and Custom Metrics > Cost Analysis and Optimization Recommendations

Cost Analysis and Optimization Recommendations

Cost Analysis

Overview of cost-generating components

Service	Billed by	Estimated Monthly Cost (e.g., 100k requests)
AWS Lambda	Number of requests + execution time (GB-seconds)	~ $2–$5
AWS X-Ray	Number of trace segments (measured per invoke)	~ $2.50 / 1 million trace segments
CloudWatch Logs	GB of stored logs + log event ingestion	~ $0.50–$1 / GB
CloudWatch Custom Metrics	$0.30 / metric / month (after first 10 free metrics)	~ $0.60 for 2 metrics
CloudWatch Alarms	$0.10 / alarm / month	~ $0.10–$0.50
SNS (email alerts)	Free for email (SMTP)	$0

Cost breakdown based on implemented solution

Component	Notes	Cost
Lambda MonitorFunction	100,000 invocations/month, avg duration 600ms, 128MB RAM	≈ $2.50
X-Ray	One trace per invoke (100k trace segments)	≈ $2.50
CloudWatch Logs	Logs for latency + EMF custom metrics	≈ $1–$2 (depends on log volume / JSON size)
Custom Metrics: ProcessingTime	Written in EMF format → billed per metric name	~$0.30–$0.60
Alarm CloudWatch + SNS	One alarm, one email topic	~$0.10
Estimated total / month		~ $6–$8.50 / month

Cost optimization strategies

Issue	Optimization Suggestion
High X-Ray cost	Enable tracing only for critical Lambdas (sampling rate 10–20%)
Too many logs	Use log level filters (e.g., log latency only if > 500ms)
Expensive custom metrics	Combine multiple metrics into one EMF log if possible
Logs stored for too long	Set Log Group Retention to 7 or 14 days
Too many frequent CloudWatch queries	Create summary dashboards instead of running ad-hoc queries
High Lambda GB-seconds usage	Reduce timeout or memory where unnecessary

Use AWS tools to analyze cost

AWS Cost Explorer
- Filter by service: Lambda, CloudWatch, X-Ray
- View by time or specific resources
AWS CloudWatch Billing Alerts
- Create alarms when total cost exceeds threshold
X-Ray + CloudWatch Metrics
- Analyze which specific requests are expensive (slow traces → high GB-seconds)
Lambda Tags
- Tag functions by cost-center, env, etc., for better cost classification

Based on tools like AWS Cost Explorer and metrics from X-Ray & CloudWatch, the system currently costs around $6–$9/month for 100,000 requests. Most costs come from Lambda execution, X-Ray tracing, and CloudWatch logs/metrics. Optimization measures include adjusting sampling rates, reducing log size, shortening log retention periods, and consolidating metrics.

Optimization Recommendations

Observation from X-Ray & CloudWatch	Suggested Optimization
⏱️ Average latency > 600ms	🔁 Use caching to reduce processing time — e.g., cache DB/API results via Redis or S3
🚀 Random latency spikes (800–1000ms)	📦 Increase memory (CPU scales with RAM) — try 256MB or 512MB instead of 128MB
📉 High ProcessingTime variability	🔄 Offload heavy tasks to async processing — e.g., logging/email → SNS or SQS + Lambda
🔁 Frequent repeated Lambda invocations	⛔ Add throttling or deduplication at the API caller side
📊 Stable metrics but slow response	⚙️ Investigate external dependencies (e.g., slow APIs, RDS, network latency…) via traces
📉 Long “Initialization” time	🛠️ Reduce cold starts — keep warm or avoid large global variables outside handler

There are many ways to optimize your system. One highly effective method is to trigger automatic resource scaling upon alerts — such as increasing memory when latency thresholds are breached, helping your app perform more reliably and efficiently.