Pricing Models

Pricing Models

Savings Plans

Purchasing Savings Plans

  • Goal: Minimize resource cost by using Savings Plans
  • Target: Unpurchased Savings Plans offering more than 10% discount not to exceed $100
  • Best Practice: Commitment Discounts - Savings Plans
  • Measures: $ value of unpurchased plans above 10% discount
  • Good/Bad: Good
  • Why? When does it work well or not?: Maximizes high quality, low risk SP consumption, & ensures SP’s that dont make business sense are not purchased
  • Contact/Contributor: natbesh@amazon.com

Purchasing Savings Plans

  • Goal: Minimize resource cost by using Savings Plans
  • Target: Ensure 80% of my on-demand usage is covered with Savings Plans
  • Best Practice: Commitment Discounts - Savings Plans
  • Measures: Coverage %
  • Good/Bad: Bad
  • Why? When does it work well or not?: It ignores the return on investment in SP & the risk. If you run <100% uptime or small resources with licensed operating systems and/or software, there can be low returns & also high risks. It can force a purchase which would be a bad business decision
  • Contact/Contributor: natbesh@amazon.com

Reserved Instances

Purchase Reserved Instances

  • Goal: Minimize resource cost by using Reserved Instances
  • Target: Unpurchased Reserved Instances offering more than 10% discount, with a pay-off period of less than 9 months must not exceed $300
  • Best Practice: Commitment Discounts - Reserved Instances
  • Measures: $ value of unpurchased RI’s above 10% discount that pay off in less than 9 months
  • Good/Bad: Good
  • Why? When does it work well or not?: Maximizes high quality, low risk RI consumption, & ensures RI’s that dont make business sense are not purchased
  • Contact/Contributor: natbesh@amazon.com

Purchase Reserved Instances

  • Goal: Maximize discounts by maximizing use of purchased Reserved Instances
  • Target: Have cost of low RI utilization below $100 for any purchased RI
  • Best Practice: Commitment Discounts - Reserved Instances
  • Measures: Wasted $ per RI
  • Good/Bad: Good
  • Why? When does it work well or not?: Minimizes waste from unused RI’s, it ensures you only act when it makes business sense & effort can be recovered by making a change.
  • Contact/Contributor: natbesh@amazon.com

Purchase Reserved Instances

  • Goal: Maximize discounts by maximizing use of purchased Reserved Instances
  • Target: Have RI utilization above 80%
  • Best Practice: Commitment Discounts - Reserved Instances
  • Measures: RI utilization %
  • Good/Bad: Bad
  • Why? When does it work well or not?: High amounts of effort required to know whether you’re actually losing money, and how much money. It can work in environments that have only a few different resource types running. This target can lead to large effort resulting in minimal gains or even a loss.
  • Contact/Contributor: natbesh@amazon.com