Which AWS feature allows a company to take advantage of usage tiers for services across multiple member accounts?

Q: What is the AWS Free Tier?

The AWS Free Tier provides customers the ability to explore and try out AWS services free of charge up to specified limits for each service. The Free Tier is comprised of three different types of offerings, a 12-month Free Tier, an Always Free offer, and short term trials. Services with a 12-month Free Tier allow customers to use the product for free up to specified limits for one year from the date the account was created. Services with an Always Free offer allow customers to use the product for free up to specified limits as long as they are an AWS customer. Services with a short term trial are free to use for a specified period of time or up to a one-time limit depending on the service selected. Details on the limits and services provided for free are detailed in each card on the Free Tier page. If your application use exceeds the free tier limits, you simply pay standard, pay-as-you-go service rates (see each service page for full pricing details). Restrictions apply; see offer terms for more details.

Q: When does the AWS Free Tier expire?

Services with a 12-month Free Tier allow customers to use the product for free up to specified limits for one year from the date the account was created. Services with an Always Free offer allow you to use the product for free up to specified limits as long as you have a valid AWS account. Services with a short term trial are free to use for a specified period of time or up to a one-time limit depending on the service selected. When your free tier expires or if your application use exceeds the free tier limits, you simply pay standard, pay-as-you-go service rates (see each service page for full pricing details). Restrictions apply; see offer terms for more details.

Q: What do I need to do to qualify for the AWS Free Tier?

The AWS Free Tier is available to all types of customers – students, entrepreneurs, small businesses, and Fortune 500 companies are all welcome to sign up. If you are linked to an Organization (under AWS Organizations), only one account within the organization can benefit from the Free Tier offers. To calculate the Organization’s use of AWS Services under any Offers, we will aggregate the usage across all accounts in the Organization. You will be charged standard rates for use of AWS Services if we determine that you are not eligible for the Free Tier or have exceeded the limits for a particular service.

Q: Are there any limitations to how I use the AWS free usage tier?

AWS’s free usage tier is not limited to specific use cases. This offering provides new AWS customers with free usage tiers for certain AWS services to help you get started. If you have a new idea that you’d like to launch or if you have an existing application you want to run in the cloud, this is a great way to get started for free. Some ideas include, but are not limited to, hosting low traffic websites or blogs, social media applications, development and test projects, proof of concepts, and more. See how other customers are using AWS today in our case study section.

For billing purposes, AWS treats all of the accounts in the organization as if they were one account. Some services, such as AWS Data Transfer and Amazon S3, have volume pricing tiers across certain usage dimensions that give you lower prices the more you use the service. With consolidated billing, AWS combines the usage from all accounts to determine which volume pricing tiers to apply, giving you a lower overall price whenever possible. AWS then allocates each member account a portion of the overall volume discount based on the account's usage.

For example, let's say that Bob's consolidated bill includes both Bob's own account and Susan's account. Bob's account is the management account, so he pays the charges for both himself and Susan.

Bob transfers 8 TB of data during the month and Susan transfers 4 TB.

For the purposes of this example, AWS charges $0.17 per GB for the first 10 TB of data transferred and $0.13 for the next 40 TB. This translates into $174.08 per TB (= .17*1024) for the first 10 TB, and $133.12 per TB (= .13*1024) for the next 40 TB. Remember that 1 TB = 1024 GB.

For the 12 TB that Bob and Susan used, Bob's management account is charged ($174.08 * 10 TB) + ($133.12 * 2 TB) = $1740.80 + $266.24 = $2,007.04.

Without the benefit of tiering across the consolidated bill, AWS would have charged Bob and Susan each $174.08 per TB for their usage, for a total of $2,088.96.

To learn more about pricing, see AWS Pricing.

AWS Free Tier for AWS Organizations

For services such as Amazon EC2 that support a free tier, AWS applies the free tier to the total usage across all accounts in an AWS organization. AWS doesn't apply the free tier to each account individually.

AWS provides budgets that track whether you exceed the free tier limits or are forecasted to go over the free tier limits. Free tier budgets are not enabled for organizations by default. Management account can opt in to free tier usage alerts through the Billing and Cost Management console. Free tier usage alerts aren't available to individual member accounts.

For more information about free tiers, see AWS Free Usage Tier FAQs. For more information about AWS Free Tier usage alerts through AWS Budgets and opting in, see AWS Free Tier usage alerts using AWS Budgets.

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