Understanding the Cost (Amortized) Metric in Cloudability

Answer

The calculation differs by cloud provider, reflecting how each vendor structures its billing data.

Amazon Web Services (AWS)

Cloudability calculates amortized cost for AWS using the same combination of Cost and Usage Report (CUR) fields that AWS itself recommends. In summary:

• For on-demand usage, the amortized cost equals the standard unblended cost.
• For Reserved Instance (RI) or Savings Plan (SP) usage, the upfront fee (if any) is amortized over the commitment term and added to the recurring hourly charge. This produces a normalized effective hourly rate for each covered resource.
• Unused RI/SP capacity is reflected as a separate line item charged back to the account that holds the commitment.

This approach mirrors the AWS methodology described in the AWS CUR Query Library — Amortized Cost by Charge Type.

Microsoft Azure

For Azure, Cloudability passes through the amortized cost directly from Microsoft's amortized cost export file. Microsoft handles the amortization calculation natively and Cloudability surfaces it as-is. You can read more about how Azure computes amortized costs in the Microsoft documentation on viewing amortized reservation costs.

Google Cloud Platform (GCP)

GCP does not use an amortization model for its commitments (Committed Use Discounts). As a result, Cost (Amortized) for GCP is equivalent to Cost (Total) — the values will be identical. There is no separate amortized cost calculation applied.

How is the metric calculated in scenarios when reservations are shared across various accounts/ resources  ?

When a Reserved Instance or Savings Plan is shared across multiple accounts, the amortized cost is allocated to the account or resource that actually consumed the commitment. This is how it works:

• Each usage line item in the billing data identifies the account and resource that used the RI or SP.
• Cloudability applies the amortized rate to each of those line items individually.
• The result is that costs are distributed across accounts in proportion to their actual usage — not centrally held by the account that purchased the commitment.

This means you can use Cost (Amortized) filtered by account to see a fair, usage-based breakdown of commitment costs across your organization — even when the reservation was purchased from a payer or management account.

** For a deeper walkthrough of your specific commitment setup, contact your Customer Success team to arrange a session with a Technical Account Manager (TAM).