EC2 Instance Purchasing Options
Comparison Table
| Option | What is it? | Commitment | Discount vs On-Demand | Interruption Risk | Best Use Case | Flexibility |
|---|---|---|---|---|---|---|
| On-Demand | Pay-per-use with no long-term commitment | None | ❌ No discount | ❌ No | Short-term, unpredictable workloads | ✅ High |
| Reserved Instances | Reserve specific instance type in specific region/AZ for long term | 1 or 3 years | ✅ Up to 75% compared to on-Demand | ❌ No | Steady-state or predictable workloads | ⚠️ Limited (Convertible RIs are flexible) |
| Savings Plans | Commit to a specific amount | 1 or 3 years specific amount ($/hr) | ✅ Up to 72% | ❌ No | Consistent usage across multiple services | ✅ High (especially Compute SP) |
| Spot Instances | Buy unused EC2 capacity at a discount, can be reclaimed by AWS anytime | None | ✅ Up to 90% | ✅ Yes (2 mins notice) | Batch jobs, stateless/fault-tolerant apps | ⚠️ Medium (based on availability) Less reliable |
| Dedicated Hosts | Physical server dedicated to you; lets you use your own licenses | 1 or 3 years (optional) | ✅ Can save (BYOL) | ❌ No | License compliance, regulatory requirements | ⚠️ Low |
| Dedicated Instances | no other customers will share your hardware | None | ⚠️ Slightly higher cost | ❌ No | Workloads needing physical isolation | ⚠️ Medium |
| Capacity Reservations | Reserve EC2 capacity in a specific AZ without launching the instance | Optional (by hour or duration) | ❌ No discount | ❌ No | Ensure capacity in specific AZ for DR, HA | ✅ High (can combine with RIs) |
Cost-effective and Highly Available!
🧩 Spot Instances for most of the load + On-Demand fallback via Auto Scaling + Multi-AZ deployment = 💸 Cost-effective and ✅ Highly Available!
Detailed Options
1️⃣ On-Demand Instances
- 📌 Pay-as-you-go pricing (per second/minute/hour)
- 📌 Best for short-term, unpredictable workloads
- 📌 No upfront commitment
- ✔ Ideal for testing, dev environments, or first-time cloud users
2️⃣ Reserved Instances (RI)
- 📌 Commitment of 1 or 3 years
- 📌 Significant savings (up to 75%) compared to On-Demand
- 📌 Two types:
- Standard RI – Can’t change much after purchase
- Convertible RI – Flexible but slightly more expensive
- ✔ Great for steady-state or predictable usage
3️⃣ Savings Plans
- 📌 Flexible alternative to RIs
- 📌 Commit to a specific amount ($/hr) for 1 or 3 years
- 📌 Covers multiple services (not just EC2)
- 📌 Two types:
- Compute Savings Plan – Most flexible
- EC2 Instance Savings Plan – More specific
- ✔ Better flexibility with cost savings
4️⃣ Spot Instances
- 📌 Up to 90% cheaper than On-Demand
- 📌 Use unused EC2 capacity
- 📌 Can be lose with short notice (2 minutes warning)
- ✔ Best for stateless, fault-tolerant, batch, or big data jobs
5️⃣ Dedicated Hosts
- 📌 Physical servers dedicated to your use
- 📌 Helps with licensing compliance (e.g., Windows/Oracle)
- 📌 Visibility into sockets, cores, host-level metrics
- ✔ Ideal for BYOL (Bring Your Own License) scenarios
6️⃣ Dedicated Instances
- 📌 EC2 instances running on hardware dedicated to a single customer
- 📌 Not as isolated as Dedicated Hosts (you don’t control the host)
- ✔ Suitable when compliance requires physical isolation
7️⃣ Capacity Reservations
- 📌 Reserve capacity in a specific AZ
- 📌 Useful for disaster recovery or high availability setups
- 📌 Charged regardless of instance usage (if not combined with RIs)
- ✔ Combine with RIs for cost-efficient reservations