AWS Savings Plans
A flexible pricing model that offers significant savings on AWS usage in exchange for a commitment to use a specific amount of resources over a one- or three-year period.
Description
AWS Savings Plans are a cost-saving option provided by Amazon Web Services (AWS) to help customers reduce their cloud spend. By committing to a specific amount of usage (measured in dollars per hour) for a one- or three-year term, customers can benefit from discounted rates compared to on-demand pricing. Savings Plans come in two primary types: Compute Savings Plans, which provide the most flexibility across any EC2 instance regardless of region, instance family, operating system, or tenancy, and EC2 Instance Savings Plans, which offer the highest savings but are limited to a specific instance family within a region. This pricing model is particularly beneficial for organizations with predictable workloads, enabling them to manage their budgets effectively while optimizing their AWS resource usage. Companies such as Netflix and Airbnb have leveraged AWS Savings Plans to better manage their cloud expenditures while maintaining the scalability and flexibility required for their services.
Examples
- A tech startup commits to a Compute Savings Plan for $500 per hour for three years, resulting in up to 72% savings on their EC2 usage.
- A large enterprise opts for EC2 Instance Savings Plans for specific instance families, saving 50% compared to on-demand pricing on consistent workloads.
Additional Information
- Savings Plans are applicable to a wide range of AWS services beyond EC2, including Fargate and Lambda.
- Customers can track their Savings Plans utilization and savings through the AWS Cost Explorer, which helps in optimizing future commitments.