💰 EC2 Purchasing Options
| Option | Description | Ideal For |
|---|---|---|
| On-Demand | Pay by the second (or hour) with no upfront commitment | Short-term, unpredictable workloads |
| Reserved Instances (RI) | Commit to 1 or 3 years for a significant discount | Steady-state usage (e.g., databases) |
| Savings Plans | Flexible alternative to RIs — commit to $/hr usage, not instance types | Long-term but flexible workloads |
| Spot Instances | Use unused EC2 capacity at up to 90% discount | Fault-tolerant, batch, or stateless jobs |
| Dedicated Hosts | Physical servers dedicated to your account | Licensing needs (e.g., Oracle, Windows Server) |
| Dedicated Instances | Run on dedicated hardware, but shared across your instances | Regulatory or compliance needs |
| Capacity Reservations | Reserve capacity in an AZ without pricing discount | Ensuring availability in specific AZ |
🔍 1. On-Demand Instances
- Billed per second (Linux) or per hour (Windows)
- No commitment, fully flexible
- Best for:
- Development and testing
- Short-term or spiky apps
- First-time users
💡 Most expensive option, but zero management overhead
🔍 2. Reserved Instances (RI)
- Commit to a specific instance type, region, and OS for 1 or 3 years
- Types:
- Standard RI – up to 72% discount
- Convertible RI – can change instance families, offers up to 54% discount
-
Payment plans:
- All Upfront
- Partial Upfront
- No Upfront
🔍 3. Savings Plans (More Flexible RIs)
- Commit to $X/hour compute usage for 1 or 3 years
- Covers EC2, Lambda, Fargate
- Types:
- Compute Savings Plan – flexible across region, OS, family
- EC2 Instance Savings Plan – limited to family & region
🔍 4. Spot Instances
- Use extra capacity at heavily discounted rates (up to 90%)
- Can be interrupted anytime with 2-minute warning
- Best for:
- Batch jobs
- Data processing
- Machine learning training
- CI/CD pipelines
🔍 5. Dedicated Hosts
- Get an entire physical server allocated to you
- Needed when you bring your own licenses (e.g., BYOL)
- Expensive, but compliance-friendly
🔍 6. Dedicated Instances
- Run on hardware not shared with other accounts
- Different from hosts – you don’t control physical sockets
- Less granular than Dedicated Hosts
🔍 7. Capacity Reservations
- Reserve instance capacity in an AZ without cost savings
- Ensures guaranteed availability for mission-critical workloads
✅ Summary Table
| Option | Flexible? | Discount | Commitment | Risk Level | Best For |
|---|---|---|---|---|---|
| On-Demand | ✅ High | ❌ None | None | ❌ Low | Dev, test, short bursts |
| Reserved Instances | ❌ Medium | ✅ Up to 72% | 1/3 years | ❌ Low | Steady apps (e.g., DBs) |
| Savings Plans | ✅ High | ✅ Up to 72% | 1/3 years | ❌ Low | Flexible long-term apps |
| Spot Instances | ✅ High | ✅ Up to 90% | None | ⚠️ High | Batch jobs, ML, stateless apps |
| Dedicated Hosts | ❌ Low | ❌ None | 1/3 years | ❌ Low | Compliance, BYOL licensing |
| Capacity Reservations | ❌ Medium | ❌ None | Optional | ❌ Low | Guaranteed AZ availability |