AWS EC2 Reserved Instances and Convertible Reserved Instances

all aws amazon ec2 aws compute aws cost management Jan 19, 2024

Introduction

Reserved Instances and Convertible Reserved Instances can significantly reduce your cloud computing costs, so understanding them is crucial, especially if we're preparing for exams or planning our AWS strategy.

What are AWS EC2 Reserved Instances?

Reserved Instances are a billing feature offered by AWS that allows you to reserve EC2 computing capacity for a fixed term – either 1 year or 3 years. By doing so, you can enjoy up to a 72% discount compared to standard On-Demand pricing. This is a significant saving, but there are a few things to keep in mind:

  • Specificity: When you opt for a Reserved Instance, you're committing to specific instance attributes. These include the instance type, the AWS region and availability zone, the tenancy (whether it's shared or dedicated), and the operating system.

  • Reservation Period: As mentioned, you can choose either a 1-year or a 3-year reservation. The longer the term, the bigger the discount you receive.

  • Payment Options: AWS offers flexibility in how you pay for Reserved Instances. You can choose No Upfront payment for a smaller discount, Partial Upfront for a moderate discount, or All Upfront for the maximum discount.

  • Scope: Reserved Instances can be scoped to either a region or a specific availability zone (zonal). If you opt for a zonal reservation, you're also reserving physical capacity in an Availability Zone (AZ).

  • Use Cases: They are particularly well-suited for applications with steady-state usage, like databases that require consistent performance over long periods.

  • Marketplace: One of the neat features of Reserved Instances is the ability to buy and sell them in the AWS Reserved Instance Marketplace, offering additional flexibility.

What about Convertible Reserved Instances?

Convertible Reserved Instances are a more flexible variant of Reserved Instances. They offer most of the same benefits but with added flexibility:

  • Changeable Attributes: With Convertible Reserved Instances, you can change the EC2 instance type, instance family, operating system, scope, and tenancy. This flexibility is crucial if your needs evolve over the reservation period.

  • Discounts: Although the discounts for Convertible Reserved Instances are slightly lower (up to 66%), they provide a balance between cost savings and adaptability.

Key Takeaways

  • Reserved Instances are perfect for predictable, steady-state workloads where you can commit to specific instance attributes for a defined period.
  • Convertible Reserved Instances offer more flexibility, allowing changes to the instance type and other attributes, making them suitable for evolving workloads.
  • Both options offer significant cost savings over On-Demand instances, but they require careful planning and understanding of your compute needs.

 

Conclusion

Understanding these instances is a powerful way to optimize your AWS costs and ensure you're getting the most out of your cloud resources. Please note that the exact discount percentages mentioned here could change over time. For the most current information and detailed guidance, always consult the official AWS documentation. 

Stay connected with news and updates!

Join our mailing list to receive the latest news and updates from our team.
Don't worry, your information will not be shared.

We hate SPAM. We will never sell your information, for any reason.