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Understanding the AWS Public IPv4 Price Hike

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AWS Announcement: Introducing a New Charge for Public IPv4 Addresses

Effective February 1, 2024, AWS will implement a charge of $0.005 per IP per hour for all public IPv4 addresses, whether attached to a service or not. It is essential to be aware that there is an existing charge for public IPv4 addresses allocated in your account but not attached to an EC2 instance.

What is the reason behind AWS public IP price increase?

IPv4 Exhaustion: The entire range of IPv4 addresses, totalling 3.7 billion, has been allocated to ISPs, companies, and associations, leading to scarcity.

IPv6 Introduction: In 2012, IPv6 was launched to provide a significantly larger address range of 340 trillion, aiming to replace IPv4.

AWS IP Resources: AWS manages a substantial pool of 136.6 million IP addresses to cater to its extensive customer base.

Increasing Demand: As more customers migrate to the AWS platform, there is a heightened demand for IP addresses to ensure optimal service provision.

Depletion of Allocations: With no more IP allocations available, AWS is compelled to purchase IP addresses from the open market.

Rising Costs: Over the years, the cost of acquiring IP addresses has surged, making it necessary for AWS to implement charges.

What will change after the increased pricing of IPv4?

Service Inclusions: AWS services encompassed by this pricing adjustment include prominent ones like Amazon EC2, Amazon RDS database instances, Amazon EKS nodes, and others.

Public IPv4 Address Allocation: The modification extends to AWS services that can have a public IPv4 address allocated and attached to them.

Global Reach: The change is not region-specific; it applies uniformly across all AWS regions, covering commercial regions, AWS China, and GovCloud regions.

Public IPv4 address pricing take effect after February 1, 2024

Scenario 1:

Resources: 1,000 EC2 Instances

Hourly Public IP Charges: $0.005

Monthly Increase: (1000*0.005 *730) = $3,650

Yearly Increase: (1000*0.005*8760(hours yearly)) = $43,800

Scenario 2:

Organisation: 1,000 AWS Accounts

Monthly Increase (across 1,000 accounts): $3,650 * 1,000 = $3,650,000

Yearly Increase (across 1,000 accounts): $43,800* 1,000 = $43,800,000

This example highlights the monthly and yearly increases in costs for both scenarios, demonstrating the potential financial impact of the AWS public IP price hike.

Implications of AWS IPv4 Price Increase

Impact on AWS Invoice: The imminent increase in AWS public IP prices brings about a monthly surge of $3.65 per resource. DoiT customers will witness an average 2.6% rise in their monthly bills. AWS, dedicated to minimising impacts on time and budget, employs best practices for client benefit.

Impact on AWS Organisations: The free AWS Cost Explorer proves invaluable for assessing organisational impacts. Adjusting the Date Range to the last month and scrutinising "PublicIPv4:InUseAddress" in Usage Type provides comprehensive insights. The calculated monthly increase, obtained by multiplying Public IP hours (201,675.28) by the hourly cost of $0.005, amounts to $1,008.38. This report aids AWS organisations in efficiently managing the financial effects of the price hike.

Impact on AWS Account: With the introduction of "Public IP Insights" in the console, users gain the power to scrutinise account-level Public IP usage. Estimating the cost increase by multiplying IPs (e.g., 137) by the hourly cost per IP ($0.005) and hours in a month (730) allows proactive assessment and management, resulting in a monthly impact of $500.05.

Impact on AWS Services: The increased IPv4 prices initiate ripple effects across various AWS services. Users may observe a shift in the cost structure for services heavily reliant on public IP addresses, influencing choices in services and configurations.

Impact on AWS Security Measures: The IPv4 price increase prompts a reevaluation of security measures within AWS environments. Organisations prioritise security enhancements, including the adoption of IPv6 and other modern security practices, ensuring a resilient and cost-effective security posture.

Impact on AWS Customer Support: As AWS users navigate changes, an anticipated surge in customer support demands may occur. Organisations are encouraged to seek guidance on cost optimisation and leverage available support resources for a smoother transition.

Impact on AWS Future Pricing Strategies: Organisations closely monitor AWS's future pricing strategies, adapting their cloud adoption plans based on evolving cost structures and pricing models introduced by AWS.

Impact on AWS Educational Initiatives: The IPv4 price increase serves as an educational opportunity for AWS users. Organisations invest in training initiatives to ensure teams are well-informed about cost implications, security practices, and alternative solutions available within the AWS ecosystem.

Practical Solutions for Addressing New IPv4 Expenses and Management Strategies

AWS future pricing strategies post-IPv4: These strategies offer diverse options for handling IPv4 addressing challenges while considering advantages and potential cost impacts.

In summary, Amazon's changes starting February 2024 aim at boosting revenue but also emphasise the importance of architectural security, particularly with the promotion of IPv6. Despite the surprise price increase, AWS provided a six-month notice, allowing customers to explore cost-effective alternatives that do not involve public IP charges. Well, the most unobvious thing for most people is to finally look at the IPv6. It was standardised back in 1998, more than 26 years ago, and it was designed to solve all the complex architectural problems caused by the shortcomings of IPv4. Organisations are advised to assess their IPv4 usage promptly to avoid unexpected costs in the upcoming February billing cycle. Stay vigilant to prevent financial surprises.

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