Optimize costs with tiered pricing in AWS Elemental MediaConvert

As a top choice for video on demand (VOD) transcoding, Amazon Web Services (AWS) Elemental MediaConvert (MediaConvert) now offers volume-based discounts that automatically apply as your usage increases. The more minutes of media you process with MediaConvert, the less you pay for every minute of video output. Let’s explore how the new pricing model works and how you can take advantage to optimize media processing workflows and reduce costs.

Overview of tiered pricing and normalized minutes

As more organizations migrate video processing workflows to the cloud, both scalability and cost predictability become increasingly important.

How do we measure volume when not all transcodes are the same? For example, a 4K High Efficiency Video Coding (HEVC) encode requires significantly more processing power than a standard definition Advanced Video Coding (AVC) encode.

To address this issue, we introduced the concept of normalized minutes.

Here’s how this works: each transcode is assigned a multiplier based on a combination of features including frame rate, resolution, codec, and number of encoding passes. Once you calculate your total normalized minutes, then you can determine your total costs based on the number of minutes processed in each tier.

Some features in MediaConvert are available in the Basic tier and others in the Professional tier. Using add-on features like Dolby Vision, HDR10+, and InSync FrameFormer frame rate conversion incurs additional costs. For the complete details see our MediaConvert pricing.

Here are a few important things to keep in mind about pricing before you start encoding with MediaConvert:

1. Volume discounts are calculated monthly: You should schedule one time, large transcode projects to complete within a singular calendar month.
2. Discounts apply independently by AWS Region and individual account: It is a best practice to use a single account in one region for all jobs. However, if you use consolidated billing in AWS Organizations, then discounts will aggregate usage across multiple accounts in the organization.
3. Discounts are applied automatically as usage increases: There are no up-front commitments required to take advantage of the discounts.
4. Discounts are calculated independently for the Basic and Professional tiers: Keep this in mind depending on what features you plan to use.

Customer scenarios

FFmpeg
To manage transcoding needs, sometimes organizations develop custom solutions using open-source tools like FFmpeg. While these in-house solutions can be effective, they demand substantial development and ongoing maintenance resources. The key benefit of such solutions is the large upfront development and operations costs can be spread across a larger number of transcode jobs as volume increases.

MediaConvert can now match this advantage through its tiered pricing structure, offering similar cost reductions with increased usage.

One time, large transcode projects
Some customers may also have periodic one time, large transcode projects. For example, when a broadcaster expands internationally their entire content library has to be transcoded to localize it for the market. These expansions often include opportunities to sign new distribution partners with video format specifications that require another transcode of the entire library.

Proper planning can optimize the volume-based discounts for these one-time transcode projects.

Broadcasters and other content owners
Broadcasters are not the only organizations with large video libraries. Other organizations including universities and large private enterprises often have large video archives. The adoption of a Learning Management System (LMS) by one of these organizations can trigger the need to transcode an archive to meet the new video requirements.

Any organization that needs to transcode a large catalog can take advantage of the new tiered pricing to cost-effectively reformat video files.

Video archives
Video archives, often accumulated over many years in various formats, present an opportunity to review and optimize storage and distribution costs. Content Delivery Networks (CDN) charge based on the total data delivered to end users. For large-scale video streamers and user generated content (UGC) customers with high content volumes, these charges can account for a significant portion of their operational costs.

Transcoding the archive or portions of a catalog into bit-efficient codecs (such as AV1 or HEVC) can result in up to 30 percent reductions in CDN and storage charges. These savings accumulate month after month, allowing customers to quickly recover the initial transcoding costs. This process also offers an opportunity to leverage advanced encoding techniques. For example, the Quality-Defined Variable Bitrate (QVBR) encoding mode in MediaConvert can further reduce file sizes while maintaining target video quality.

Viewership patterns
Many customers have “longtail” viewership patterns, meaning only a small percentage of their content is responsible for the majority of the views. The majority of their content may have very few or no views at all.

MediaConvert allows customers to effectively balance delivery and transcoding costs by taking advantage of higher level transcodes once viewership on an asset hits a certain threshold (for example, converting from AVC to HEVC after a piece of content receives 10,000 views). Customers can efficiently manage budgeting between their CDN and transcoding bills by increasing their transcoding expenses only when it will result in larger savings for their delivery charges.

Cost savings examples

Let’s look at some examples and compare the new normalized minutes and tiered pricing to the previous MediaConvert pricing.

Example one
Here is a streamlined example of cost savings based on Basic tier pricing. If a university recorded ~16 hours a week of video over the past five years, their archive would have 250,000 minutes of content. Since this is an older archive, 40 percent (or 100,000 minutes) of the archive is in standard definition (SD) and the rest in high definition (HD), all in 30 frames per second (fps). The cost (rounded to the nearest dollar) to transcode the entire archive in the us-east-1 (N. Virginia) Region into a single bitrate AVC format in the Basic tier would be:

Minutes * Multiplier = Normalized Minutes
100,000 SD minutes = 100,000 * 1 = 100,000
150,000 HD minutes = 150,000 * 2 = 300,000
Total normalized minutes = 400,000

Normalized Minutes (Separated into Tiers) * Rate = Total Cost
(100,000 * Tier 1 price) + (300,000 * Tier 2 price)
(100,000 * $0.0075) + (300,000 * $0.0053)
Total cost: $750 + $1590 = $2,340

If this had been charged using the previous version of MediaConvert pricing, without normalized minutes and tiers, the total would be: $628 (SD AVC) + $2,250 (HD AVC) = $2,878

For this example, the university saves $538 or 19 percent compared to the previous pricing.

Example two
A large content producer has a direct-to-consumer platform that offers a premium service with 4K HDR titles along with a standard service with HD SDR content. The content producer publishes 300 hours of new content every month. To ensure viewers experience a smooth transition between each step of the adaptive bit rate (ABR) ladder, 12 High Dynamic Range (HDR) HEVC renditions are created for the premium service. Ten Standard Dynamic Range (SDR) AVC renditions are also created for the standard service.

The cost to transcode one month of new content in the us-east-1 (N. Virginia) Region is calculated as: 300 hours = 18,000 minutes (300 * 60 = 18,000)

Basic Tier AVC Single-Pass HQ (Balanced)
One rendition HD less than 30 fps: 18,000 minutes * 2 = 36,000 normalized minutes
Two renditions HD greater than 30 fps: 36,000 minutes * 2.5 = 90,000 normalized minutes
Seven renditions SD less than 30 fps: 126,000 minutes * 1 = 126,000 normalized minutes

Total Basic tier normalized minutes = 36,000 + 90,000 + 126,000 = 252,000 normalized minutes

Professional Tier HEVC Single-Pass HQ (Balanced)
One rendition 4K greater than 30 fps: 18,000 minutes * 10 = 180,000 normalized minutes
Three renditions HD greater than 30 fps: 54,000 minutes * 5 = 270,000 normalized minutes
Eight renditions SD less than 30 fps: 144,000 minutes * 2 = 288,000 normalized minutes

Total Professional tier normalized minutes = 180,000 + 270,000 + 288,000 = 738,000 normalized minutes

Normalized Minutes (Separated into Tiers) * Rate = Total Cost
(100,000 * Basic Tier 1 price) + (152,000 * Basic Tier 2 price) + (50,000 * Professional Tier 1 price) + (688,000 * Professional Tier 2 price)
(100,000 * $0.0075) + (152,000 * $0.0053) + (50,000 * $0.012) + (688,000 * $0.0096) = $8,760
Total cost: $750 + $805 + $600 + $6605 = $8,760

If this had been charged using the previous version of MediaConvert pricing, without normalized minutes and tiers, the total would be: $270 (HD AVC) + $677 (HD AVC) + $945 (SD AVC) +$2,160 (4K HEVC) + $3,240 (HD HEVC) + $3,456 (SD HEVC) = $10,748

Comparing this example to previous pricing in MediaConvert, the content producer saves $1,988 or 18.5 percent.

Total cost considerations

The reduced cost tiered pricing in MediaConvert for transcoding content increases opportunities to lower other expenses in video workflows. Storage and CDN costs often represent the largest expenses for delivering video. By reducing file sizes, you can significantly decrease both storage and CDN costs.

File size reduction can be achieved through two primary methods:

1. Using QVBR can reduce file sizes by 25-50 percent
2. Encoding to HEVC instead of AVC typically yields a 30 percent reduction in file sizes while maintaining the same quality

Transcoding an archive to take advantage of these reduced file sizes often offers a significant return on investment. Consider a large UGC site with a 300 TB archive that delivers 30 million minutes of content monthly in the United States at an average bit rate of 5 Mbps. Operating from the US-East-1 Region, a 30 percent reduction in file sizes would incur a transcode cost of $16,706.

However, this investment would reduce monthly storage and CDN costs by $11,770, resulting in an annual savings of $141,245. With these numbers, the organization would recover the transcode costs in less than one and a half months, demonstrating the potential for substantial long-term savings.

Total Transcode Costs
The UGC site delivers an ABR bouquet of 3 SD and 2 HD renditions

Minutes * Multiplier = Normalized Minutes
1,700,000 SD Minutes = 1,700,000 * 1 = 1,700,000
1,150,000 HD Minutes = 1,150,000 * 2 = 2,300,000
Total Normalized Minutes = 4,000,000

Normalized Minutes (Separated into Tiers) * Rate = Total Cost
(100,000 * Tier 1 price) + (900,000 * Tier 2 price) + (3,000,000 * Tier 3 price)
(100,000 * $0.0075) + (900,000 * $0.0053) + (3,000,000 * $0.0038)
Total cost: $750 + $4,770 + $11,400 = $16,920

Total Storage Costs
Reduce file sizes by 30 % : 300 TB * 70 % = 210 TB
Cost each month to store 300 TB/Month in Amazon S3 Standard = $6,810
Cost each month to store 210 TB/Month in Amazon S3 Standard = $4,782
Monthly Savings = $2,028
Annual Savings = $24,336

Total CDN Costs
Average bit rate before transcode = 5 Mbps
Average bit rate after transcode = 5 Mbps * 70 % = 3.5 Mbps
Cost to deliver 30 million minutes each month at 5 Mbps = $40,649
Cost to deliver 30 million minutes each month at 3.5 Mbps = $31,261
Monthly savings = $9,388
Annual savings = $112,656

Total Storage and CDN Savings
Monthly savings = $11,416
Annual savings = $136,992

Our examples provide clear reasons for why organizations should start to take advantage of the new tier pricing model in AWS Elemental MediaConvert. Following are some next steps you can take to get started:

1. Assess your current MediaConvert usage and identify potential areas for optimization
2. Plan your workflows to maximize volume discounts within each tier
3. Implement automated solutions to streamline media processing
4. Regularly monitor usage and costs and implement optimizations

Conclusion

The new tier pricing model in AWS Elemental MediaConvert offers significant cost savings opportunities for organizations of all sizes. Tiered pricing provides automatic cost savings as transcoding volumes increase. By strategically planning your media processing workflows and leveraging both Basic and Pro tier features, you can optimize your costs while maintaining high-quality outputs for various distribution channels and use cases.

For more information on AWS Elemental MediaConvert read our official documentation or contact an AWS Representative to know how we can help accelerate your business.

Further reading

• Learn how MasterClass enhances video quality and reduces costs with AWS Media Services
• For more on automating workflows, learn about Dynamically configuring job settings with AWS Elemental MediaConvert
• Find out how to Enhance video efficiency with the bandwidth reduction filter in AWS Elemental MediaConvert