Ref: https://learn.cantrill.io/courses/1820301/lectures/41301339 and https://learn.cantrill.io/courses/1820301/lectures/41301340

• Summary
• Contents:

AWS Reservations - Key concepts

• 🔧 Commitments to use AWS resources long-term, AWS offers benefits in return
  • 💡 Generic to more AWS services than only EC2
• ‼️ Once you commit, you pay!! (whether you use the resources fully or not!!)
  • Important to plan reservations appropriately
  • Purchasing a reservation and not using it is wasted $$$
• Types of EC2 reservations
  1. Billing reservations (e.g. EC2 Reserved instances): customers commit to use a type of instance in an AZ or region for a fixed term, in exchange for discounts on instance billing
  2. **Capacity reservations:** customers pay to guarantee available capacity where they can launch instances (usually business critical instances)
  3. **EC2 savings plans:** customers commit to pay an hourly rate for a fixed term, in exchange for discounts on billing

EC2 Reserved Instances (RIs)

• 🔧 Commit to use instances you launch for a long term (1 or 3 years), get discounts
  • 💡 Form a part of most larger deployments within AWS
• Ideal for long-term, consistent usage of EC2
  • Feasible to make a long-term commitment to AWS about usage
  • Perfect for infrastructure that is always there and never changes

• Time commitment: 1 year or 3 years
  • You pay for the entire term
  • Discount is greater for 3-year commitments, but risk is also greater
    • requirements could change in those 3 years → be considerate when setting the term
  • ‼️ If you terminate a RI before commitment is over, you STILL get billed for it!!
    • One way around this: sell your unusued RIs in the AWS Marketplace → if another customer buys it from you, the billing goes to them (and they get to use the instance)
• Payment commitment options:
  1. No-Upfront: simply pay a reduced per-second instance fee, no upfront money
     • 👍 Easy and clean, no cashflow
     • 👎 Less discount than partial- or all-upfront options
     • Reduced instance fee is paid whether the instance is running or not (even if terminated!)
  2. Partial-Upfront: pay some money upfront, greatly reduce per-second instance fee
     • Good middle ground (less initial money than all-upfront & less fee than no-upfront)
     • Reduced instance fee is paid whether the instance is running or not (even if terminated!)
  3. All-Upfront: pay all money upfront, don't pay any per-second instance fee
     • 👍 Greatest discount of all options
• ❗ Reservations are purchased for a type of instance and locked for an AZ or region
  • Reservations are used when instances of that type are launched in the specified AZ or region
  • Partial coverage of larger instance also possible
    • Instance bigger than what you reserved → part of the instance will get discounts
• Types of EC2 instance reservations
  1. Regional reservation
     • Instances launched in any AZ of region benefit from billing discounts → 👍 flexible
     • ❗ No capacity reserved within any AZ of the region!
       • launched instances have same priority as on-demand instances
       • 👎 risky during major faults when capacity can be limited
  2. Zonal reservation
     • Billing discounts only apply to instances launched in specified AZ → 👎 less flexible
     • ❗ Capacity reserved within the specified AZ
       • 👍 higher priority than on-demand instances

Standard RIs

• Historically the only type of reserved instance
  • standard reserved instance = reserved instance (colloquially)
• Commitment for no-disruption, long-term workload
  • 24/7/365 (all-day, every day, no interruptions)
  • 👍 Best (cheapest) price for this kind of workload