For many organizations, the cost of running High Performance Computing (HPC) engineering simulation workloads in the cloud is a major concern at many manufacturers. In a recent market survey conducted by a third party for AWS, almost half of the participants said cost and cost-management for cloud were barriers. This impression is often based on simplified calculations just based on the number of core hours needed for their Computer Aided Engineering (CAE) simulations, multiplied by the hourly core hour prices see e.g. here.
With such a rough estimate, however, it is difficult to get a reasonable picture of the total cost of cloud and how the company would benefit (ROI) from such a cloud investment.
Therefore, in the following, we calculate the total cost a company has to spend for an engineering simulation workplace in the cloud, and contrast this with the list of potential benefits the company gains from such an investment.
According to ZipRecruiter, the average annual salary of a senior simulation engineer in 2024 for example in the Detroit area is $127K. The total cost for the engineer's company including all additional labor costs is usually estimated to be roughly 2x of $127K. There are about 250 workdays in the US in 2024, resulting in the engineer's total cost of 2x $127K / 250 = $1,016 per day.
In addition, we estimate that the engineer uses commercial simulation software (e.g. from Ansys, Cadence, Dassault, Siemens) at a license cost of $100K per year, resp $400 per day. Suppose the engineer submits ten 2-hour simulation jobs per workday (each job running on 4 compute nodes with $5 per compute node per hour), resulting in cloud consumption of $200 per day.
In total, an engineer’s workplace, simulation software, and cloud consumption result in the following cost estimation (per day):
*) Comparison with an on-premise HPC system’s total cost of ownership (TCO) should include, among others, air cooling systems, employee salaries, employee training, energy consumption, facilities-related costs, liquid cooling systems, system downtime, subscription-based licensing, and system maintenance and support, over the life-time of the HPC system, https://www.ansys.com/blog/understanding-total-cost-ownership-hpc-ai-systems.
“The cost of an average engineering simulation workplace in the Midwest is $1616 per day.”
The above cost calculation does not include any cost for a do-it-yourself (DIY) setup of the HPC cloud environment. Such a setup can easily amount to several person months. And according to a recent Gartner study, 83% of DIY cloud migration projects either fail or exceed their budgets and schedules.
An alternative is to work with an expert team from one of the Cloud Services Providers (CSPs, e.g. Simr, Rescale, SimScale) which are familiar with the SimOps (Simulation Operations Automation) best practices Framework. Although their cloud-bases simulation offerings often differentiate in the software platform and services, comparison and weighing against each other is not too difficult.
Either you are working for a small company (SME) with one or just a few commercial ISV codes, or you are working for a large manufacturing company with a dozen or more ISV and/or inhouse ‘homegrown’ multi-physics simulation workflows, the choice might be relatively clear: an SME might favor a SaaS solution, e.g. Ansys Cloud, 3DEXPERIENCE, Rescale, or SimScale, while a large enterprise tends to look for more agility, control, and customization, e.g. the Simr Platform.
Anyway, this CSP cost should be added to the above total workplace cost. Suppose a cloud simulation platform license costs $15K per engineer per year, or $15K / 250 workdays = $60 per workday, this results in just 60 / (1616 + 60) x 100 = 3.6% of a simulation engineer's workplace total cost per day in 2024 in the Detroit area.
“The cost of a simulation cloud platform is just 3.6% of an engineer’s total workplace cost per day in the Detroit area.”
There is often the consideration that, to be able to use more compute resources in the cloud (to increase the engineer’s productivity), additional ISV licenses are necessary, either BYOL (Bring Your Own License) or flexible, pay-per-use licensing that enables usage-based licensing for the software, that many ISVs offer.
But even this additional license cost is relatively low compared to the overall cost of an engineering workplace, namely e.g. $100K / 250 workdays = $400 per day per engineer resp 400 / (1616 + 400) x 100 = 20% of a simulation engineer's total cost per day in 2024 in the Detroit area.
“The cost of an ISV cloud license is only about 20% of an engineer’s workplace per day, but comes with a 100% productivity increase for the engineer.”
But what Return on Investment (ROI) does the company get for the additional 3.6% cloud service provider cost, resp the 20% of additional simulation software license cost? Here is a short list of additional benefits for the company and its engineers, their managers, corporate IT, and decision makes:
For Engineers and Their Managers:
For Corporate IT:
And for Corporate Decision Makers:
Finally, Cost Savings with Cloud HPC:
The additional cloud related investments in CSP and software (as mentioned above) can result in the following cost savings:
“More and faster compute resources in the cloud enable more simulations with more parameters, producing better results (finding better materials, geometries, physics) and higher quality products.”