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Why?
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Reserved Instances at AWS provide a significant discount (up to 75%) compared to On-Demand pricing and can provide a capacity reservation when used in a specific Availability Zone. |
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Types
Reserved Instances
- Standard Reserved Instances
- Apply to a single instance family, platform, scope, and tenancy over a term
- One or three year term
- Can reserve capacity (locked into one availability zone, "zonal RI") or be regional (can launch in any AZ within the region, "regional RI")
- Associated with one region for duration of term
- Greatest discount
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- All up front
- Biggest discount
- Full payment is made at the start of the term, with no other costs incurred for the remainder of the term, regardless of hours used.
- Partial up front
- A portion of the cost must be paid upfront and the remaining hours in the term are billed at a discounted hourly rate, regardless of usage.
- No up front
- One year term
- Available with a 3 year term for C4, M4, R4, I3, P2, X1, and T2 Standard Reserved Instances only
- You are billed a discounted hourly rate for every hour within the term, regardless of usage, and no upfront payment is required.
Billing
- NOTE with the recent announcement of With per-second billing for EC2 instances instances you can launch, use, and terminate multiple instances within an hour and get the Reserved Instance Benefit for all of the instances. This includes Windows Server, SQL Server, and open source Linux.
- Reserved Instances are billed for every clock-hour during the term that you select, regardless of whether an instance is running or not.
- Reserved Instance billing benefits only apply to one instance-hour per clock-hour. (This needs to be confirmed for current applicability.)
- A new instance-hour begins after an instance has run for 60 continuous minutes, or if an instance is stopped and then started. Rebooting an instance does not reset the running instance-hour.
- can be applied to a running instance on a per second basis.
- Rebooting an instance doesn't start a new instance billing period (with a minimum one-minute charge), unlike stopping and starting your instance. If an instance is stopped then started again, you stop incurring charges for an instance as soon as its state changes to stopping. Each time an instance transitions from stopped to running, a new instance billing period is started, billing a minimum of one minute every time you start your instance.
For example, if an instance is stopped and then started again during a clock-hour and continues running for two more clock-hours, the first instance-hour (before the restart) is charged at the discounted Reserved Instance rate. The next instance-hour (after restart) is charged at the On-Demand rate and the next two instance-hours are charged at the discounted Reserved Instance rate.(This needs to be confirmed for current applicability.)
Consolidated Billing
- You cannot control which instances are billed at the discounted rate
- If you leverage Consolidated Billing, AWS will use the aggregate total list price of active RIs across all of your consolidated accounts to determine which volume discount tier to apply.
- Additional savings begin at $500k
- Convertible RIs do not receive volume discounts however the value of each Convertible RI that you purchase contributes to your volume discount tier standing.
- Reserved Instances are first applied to usage within the purchasing account, followed by qualifying usage in any other account in the organization. The Reserved Instance discount is applied to qualifying usage that is detected first by the AWS billing system.
- In general, Reserved Instances that are owned by an account are applied first to usage in that account. However, if there are qualifying, unused zonal Reserved Instances in other accounts in the organization, they are applied to the account before regional Reserved Instances owned by the account.
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- The Reserved Instance Marketplace is an online marketplace that provides AWS customers the flexibility to sell their Amazon Elastic Compute Cloud (Amazon EC2) Reserved Instances to other businesses and organizations.
Questions the Cloud Team had for AWS
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- No clock hour, only instance hour. Stopping and starting within an hour adds an hourly charge per start.
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- RI cannot apply to two instances simultaneously. Take away for additional research from AWS. Billed for every clock hour.
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- RI hour at top of clock hour, applied to first match. Reevaluated at top of clock hour. Need to research with billing team.
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- Dependent on cost of capital. At scale 5% can make a difference.
- No up front billing - someone else uses RI, account A still pays, account B gets it "free". Compute charge back numbers yourself.
- Blended rate - average price across all. (PDF - not correct due to RIs)
- Unblended rate - sum up for each account. Will show, "at this given hour what was hour rate".
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- License baked in to SKU for instance hour on Windows and Red Hat. Pricing is not linear to resource.
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- AWS looking for more information. Will confirm with RDS team.
- No normalization factor weighting in RDS RIs.
- Single AZ deployment RI cannot be converted to multi AZ RI.
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General Recommendations
- No up front cost purchase type
- Regional
- Standard RI (assuming your needs won't change that much)
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