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Types of AWS Savings Plans

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In the fourth article in our series comparing the AWS Reserved Instances and AWS Savings Plan models, we look at the types of AWS Savings Plans.

When it comes to Savings Plans, AWS users are required to pledge spending a predefined amount of money on an hourly basis for the computing resources they want to access. This usually entails accepting one-year or three-year payment terms. In exchange for this, AWS will charge you less through its hourly compensation rate within these intervals. The resources supported as part of this scheme include Lambda, Fargate, and others.

How long will this discount arrangement last? Well, as long as you stay within the limits of the value you committed to as part of the Savings Plan. For anything you spend beyond the limits you initially committed to, AWS will ask you to pay for the usage at a regular on-demand rate.

Just like AWS Reserved Instances, AWS Savings Plans are also available as two options: EC2 Instance Savings Plan and Compute Savings Plan.

Similar to what we have seen with Standard RIs, one of these options comes off as a less flexible one, but with a higher discount. EC2 Savings Plans will be a more restrictive option here but it will try to charm you with a more attractive discount of 72%. If you go for it, you will commit to paying an hourly rate for a specific instance family in a defined region, irrespective of the availability zone, instance size, operating system, tenancy, and other considerations.

Compute Savings Plans will give you more flexibility in exchange for a limited discount that does not go beyond 66%. The main attraction is the broader applicability of Compute Savings Plans – it gives you an option to apply this discount to Fargate, EC2 instances, and Lambda services without restrictions on the instance family, size, operating system, tenancy, or AWS region.

This means that you can move from C5 to M5 without restrictions and enjoy the same benefit when changing the region from EU (Ireland) to EU (London), switching from Windows to Linux, swapping dedicated tenancy for default tenancy, or migrating from EC2 to Fargate.  

In the next article, we are going to compare Reserved Instances and Savings Plans as discount options for AWS users.