0
Pricing Model for EC2
• 3 ways to pay
– On Demand
– Reservation
– Spot
• You get exact same instance in each case
• Pricin...
Pricing Model makes HUGE difference
• 70%+ of your AWS bill will be EC2
• Leveraging different models, you can pay
70%+ le...
On Demand
• Highest cost
• No up-front commitment
EC2
Reserved
• Pay up-front “reservation” fee
• In exchange for lower hourly fee
• (Possibly) lowest cost for dedicated
instan...
Reserved
…Think “Plan” EC2
Plan Down Payment Hourly Cost
None $0 $1.00
Platinum $100 $0.30
Gold $60 $0.50
Silver $30 $0.80
Reserved
Billing 1st Payment Hourly Cost
On Demand $0 $1.00
High Usage $100 $0.30
Medium Usage $60 $0.50
Low Usage $30 $0....
Reserved
Billing Term 1st Payment Hourly Cost
On Demand N/A $0 $1.00
High Usage 3yr $100 $0.30
High Usage 1yr $90 $0.35
Me...
On Demand + Reserved
• Mixing gives good balance of
– Cost savings
– Flexibility
EC2
0
50
100
150
200
1 3 5 7 9 11 13 15 1...
How do I apply Reservations?
• You don’t, AWS does
• If you have a reservation for an instance of:
– Specific Type, AZ, OS...
On Demand cheaper than Reserved?
• AWS continues to cut pricing
– 21 times in last 4 years
• Some customers observed that ...
What if I buy the wrong Reservation?
You can now sell (and buy) unused reservations
http://aws.amazon.com/ec2/reserved-ins...
Spot Instances
• On Demand & Reserved are “stable”
– AWS cannot shut your servers down
• Not so with spot!
• Spot instance...
Spot Instances
• On Demand & Reserved are “stable”
– AWS cannot shut your servers down
• Not so with spot!
• Spot instance...
Spot Use Cases
EC2
• Batch jobs
• Offline processing
• Big Data analysis
– EMR (Hadoop in AWS can use spot for worker node...
On Demand + Reserved + Spot
• Spot serves peak
EC2
0
50
100
150
200
1 3 5 7 9 11 13 15 17 19 21 23
#Servers
Load
Load
RESE...
Spot Best Practices
EC2
• Break work into smallest pieces possible
• Return useful results ASAP
– Minimize data copy in & ...
Spot Instances
• Historical prices available
– From console (EC2 dashboard)
– Programmatically (consume API via scripts)
E...
Spot Instances
• Spot prices get bid up
– For short periods of time
– Mainly by scientific & financial institutions
EC2
Use Case: On Demand
• New to AWS
– Not yet sure which AZ and instance type you’ll use long-term
– Not sure if you’ll stay ...
Use Case: Reserved
• Established with AWS
– You know exactly which AZ and instance type you’ll use long-term
• Established...
Choose Pricing Wisely
• Start slow with On Demand
• Add in reservations as it makes sense
• Investigate ways to use Spot
•...
Pricing Model for EC2
• 3 ways to pay
– On Demand
– Reservation
– Spot
EC2
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EC2 Pricing Model (deck 0307 of the InfiniteSkills AWS course at http://bit.ly/learn-aws

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More clearly explains On Demand, Reserved, and Spot instances. Part of a much larger, 5+ hour course at http://bit.ly/learn-aws/ (this is deck 0307 of the course). NOTE: Some info is outdated in here.

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Transcript of "EC2 Pricing Model (deck 0307 of the InfiniteSkills AWS course at http://bit.ly/learn-aws"

  1. 1. Pricing Model for EC2 • 3 ways to pay – On Demand – Reservation – Spot • You get exact same instance in each case • Pricing is just a billing construct • In each case, capacity is not guaranteed (even for reservations) – AWS has (rarely) run out of capacity in their data centers EC2
  2. 2. Pricing Model makes HUGE difference • 70%+ of your AWS bill will be EC2 • Leveraging different models, you can pay 70%+ less for the exact same instance EC2
  3. 3. On Demand • Highest cost • No up-front commitment EC2
  4. 4. Reserved • Pay up-front “reservation” fee • In exchange for lower hourly fee • (Possibly) lowest cost for dedicated instance (spot can be taken away) • 1 and 3 year terms available • Restrictive. Reservation must include: – AZ – Instance type – Platform – Term (1 or 3 years) EC2
  5. 5. Reserved …Think “Plan” EC2 Plan Down Payment Hourly Cost None $0 $1.00 Platinum $100 $0.30 Gold $60 $0.50 Silver $30 $0.80
  6. 6. Reserved Billing 1st Payment Hourly Cost On Demand $0 $1.00 High Usage $100 $0.30 Medium Usage $60 $0.50 Low Usage $30 $0.80 EC2 High Usage is charged as always on! 24x7x365 …Now Reality (almost)
  7. 7. Reserved Billing Term 1st Payment Hourly Cost On Demand N/A $0 $1.00 High Usage 3yr $100 $0.30 High Usage 1yr $90 $0.35 Medium Usage 3yr $60 $0.50 Medium Usage 1yr $50 $0.60 Low Usage 3yr $30 $0.80 Low Usage 1yr $20 $0.90 …Full reality (complicated as ever)
  8. 8. On Demand + Reserved • Mixing gives good balance of – Cost savings – Flexibility EC2 0 50 100 150 200 1 3 5 7 9 11 13 15 17 19 21 23 #Servers Load Load RESERVED ON DEMAND
  9. 9. How do I apply Reservations? • You don’t, AWS does • If you have a reservation for an instance of: – Specific Type, AZ, OS – AWS applies the reservation billing automatically – You always are charged lowest rate possible – (or are you)? EC2
  10. 10. On Demand cheaper than Reserved? • AWS continues to cut pricing – 21 times in last 4 years • Some customers observed that over 3 years, On Demand could be cheaper! • Past Performance != Future EC2
  11. 11. What if I buy the wrong Reservation? You can now sell (and buy) unused reservations http://aws.amazon.com/ec2/reserved-instance/marketplace EC2
  12. 12. Spot Instances • On Demand & Reserved are “stable” – AWS cannot shut your servers down • Not so with spot! • Spot instances: – You bid for unused capacity in a data center – If your bid is filled, you get the instance – If spot price goes above your bid, you lose that instance – …without warning – AWS determines the spot price EC2
  13. 13. Spot Instances • On Demand & Reserved are “stable” – AWS cannot shut your servers down • Not so with spot! • Spot instances: – You bid for unused capacity in a data center – If your bid is filled, you get the instance – If spot price goes above your bid, you lose that instance – …without warning – AWS determines the spot price EC2 Why would anyone ever want to use spot?!
  14. 14. Spot Use Cases EC2 • Batch jobs • Offline processing • Big Data analysis – EMR (Hadoop in AWS can use spot for worker nodes) • Throw-away environments – Testing, development • Buffering user-facing web traffic – Very advanced use case!
  15. 15. On Demand + Reserved + Spot • Spot serves peak EC2 0 50 100 150 200 1 3 5 7 9 11 13 15 17 19 21 23 #Servers Load Load RESERVED ON DEMAND SPOT
  16. 16. Spot Best Practices EC2 • Break work into smallest pieces possible • Return useful results ASAP – Minimize data copy in & out (like SETI@Home) • If using to “serve peak”: – Set bid price high – Fail over to On Demand if bid not fulfilled
  17. 17. Spot Instances • Historical prices available – From console (EC2 dashboard) – Programmatically (consume API via scripts) EC2
  18. 18. Spot Instances • Spot prices get bid up – For short periods of time – Mainly by scientific & financial institutions EC2
  19. 19. Use Case: On Demand • New to AWS – Not yet sure which AZ and instance type you’ll use long-term – Not sure if you’ll stay with AWS • New products (daily usage curve unknown) • Buffering known curves (Reserved serves most) • Prototyping • You feel EC2 price trend line will continue EC2
  20. 20. Use Case: Reserved • Established with AWS – You know exactly which AZ and instance type you’ll use long-term • Established products (daily usage curve known) • Buffering known curves (Reserved serves base) EC2
  21. 21. Choose Pricing Wisely • Start slow with On Demand • Add in reservations as it makes sense • Investigate ways to use Spot • Keep watching AWS pricing • Keep re-calculating “cheapest” option EC2
  22. 22. Pricing Model for EC2 • 3 ways to pay – On Demand – Reservation – Spot EC2
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