Amazon Adds 'Reserved' Pricing Options to EC2 Cloud

Amazon Web Services is launching a new pricing option aimed to provide EC2 users more predictability and lower costs. With 'Reserved Instances' Amazon expands EC2's current On-Demand pay-as-you-go pricing.

Tags: Reserved Instances, Ec2, Amazon Ec2, Pricing, Capacity, Usage Charges, Customers,


Amazon Web Services is launching a new pricing option aimed to provide EC2 users more predictability and lower costs. With 'Reserved Instances' Amazon expands EC2's current On-Demand pay-as-you-go pricing by giving customers the option of making a low, one-time payment to reserve capacity and reduce hourly usage charges.

"Customers of all sizes enjoy the pay-as-you-go flexibility of Amazon EC2, but many have told us they are ready to reserve capacity in order to achieve even lower costs," said Peter De Santis, General Manager of Amazon EC2, in a statement. "Now customers can choose to reserve capacity as if they owned the hardware, but unlike traditional infrastructure, with Reserved Instances, customers do not pay to maintain and operate idle hardware, and instead pay usage charges only when actually utilizing the instances."

Reserved Instances function the same way as On-Demand Instances function, so customers can now plan for an anticipated amount of capacity using Reserved Instances and then instantly increase On-Demand Instances if they need more computing capacity than they have reserved, the company said. Sample pricing for Reserved Instances here.

Customers can also handle all of their capacity needs using only On-Demand instances or only Reserved Instances, which are available in 1-year or 3-year terms, the company said.

"AWS's pricing and delivery model allowed us to launch quickly knowing we had the flexibility to scale our infrastructure as needed," said Amir Nathoo, co-founder of WebMynd Corp., in the statement. "We started with one small EC2 instance, and now at peak loads have up to 25 large instances. With the introduction of Reserved Instances, we can be confident that AWS remains the best infrastructure choice for us, even for parts of our service where load is predictable."

Large enterprises expect the new price option will save more money, without jeopardizing flexibility offers by the Ec2 access-on-demand model. Notably, even execs at Oracle, are bullish.

"Many enterprise customers are able to determine predictable minimum levels of usage for their cloud computing needs. Oracle Database development in the cloud is good example," said Robert Shimp, Group Vice President, Technology & Architecture at Oracle. "With Amazon EC2 Reserved Instances, customers can pay an up-front charge and obtain better pricing from Amazon for the EC2 capacity needed to develop Oracle Database applications. But just as with the rest of AWS, if their needs spike when they move to application testing, they retain the flexibility to grow usage of Amazon EC2 compute resources along with it."

Reserved Instances can be purchased for 1 or 3 year terms, and the one-time fee per instance is non-refundable. Usage pricing is per instance-hour consumed. Instance-hours are billed for the time that instances are in a running state; if you do not run the instance in an hour, there is zero usage charge. Partial instance-hours consumed are billed as full hours.

Reserved Instances are currently available for Linux/UNIX operating systems. We expect reserved Instances to be available for the EU region in the near future. Learn more about Amazon EC2 Reserved Instances with an online FAQ.



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