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Savings plan

As explained in Amazon Web Services in Action, Third Edition: An in-depth guide to AWS

An AWS Savings Plan is a pricing commitment that provides discounted rates in exchange for a specified level of ongoing resource consumption over a term.

An AWS Savings Plan reduces compute costs by committing to a specified level of ongoing resource consumption for one or three years. The commitment lowers the rate but reduces flexibility compared with on-demand instances. section 3.8 section 3.8.1

Choose between two EC2-related Savings Plan types:

  • Compute Savings Plans apply across EC2, Fargate, and Lambda, providing more workload flexibility. section 3.8.1
  • EC2 Instance Savings Plans apply only to EC2 instances in a specified region and instance family, but offer a higher discount. section 3.8.1

When purchasing a plan, specify the term, hourly commitment in US dollars, and payment option: all upfront, partial upfront, or no upfront. EC2 Instance Savings Plans also require a region and instance family. The discount varies by term, payment option, and region. section 3.8.1

A predictable EC2 workload

Committing to $1 per hour for one year and paying $8,760 upfront can provide an m5.large discount in US East (N. Virginia). The cited example gives a 31% discount with a Compute Savings Plan and 42% with an EC2 Instance Savings Plan for m5 instances in us-east-1. section 3.8.1

Table 3.2 Differences between on-demand instances, Savings Plans, and Spot Instances (view table figure)

 

On-demand instances

Savings Plans

Spot Instances

Price

High

Medium

Low

Flexibility

High

Low

Medium

Reliability

High

High

Low

Scenarios

Dynamic workloads (e.g., for a news site) or proof of concept

Predictable and static workloads (e.g., for a business application)

Batch workloads (e.g., for data analytics, media encoding, etc.)

Compare Savings Plans with on-demand instances and Spot Instances by price, flexibility, reliability, and workload scenario. section 3.8

How Amazon Web Services in Action, Third Edition: An in-depth guide to AWS covers it

How deep it goes
Explains plan types, commitment settings, discounts, and scope, but does not provide purchase commands or console steps.
Examples
Uses a $1-per-hour, one-year commitment for an m5.large in US East (N. Virginia) to compare discounts.
What it assumes
Assumes familiarity with EC2 instances and hourly resource consumption while introducing Savings Plan types and commitment settings.
What you can do after
Evaluate AWS compute pricing options for predictable workloads using commitment, flexibility, reliability, and discount trade-offs.
How it connects
Connects EC2 with Fargate, Lambda, on-demand instances, Spot Instances, regions, and instance families.

Related concepts

This explainer was generated by Manning's knowledge graph from the text of Amazon Web Services in Action, Third Edition: An in-depth guide to AWS. The section links point to the parts of the book it draws on.