If you’re using AWS cloud computing as a long term strategy, whether for yourself or as a reseller, it seems fairly evident that Reserved Instances are a good investment. By committing to a simple contract, you can save up to 75% compared to On-Demand Instances. But does that really mean you’re getting the most from your money?
Many companies know that RIs can be helpful, but don’t really know how to use them properly, and end up wasting money. Cloud computing is about flexibility. Does your long term contract offer you the flexibility you need? Let’s take a closer look at Reserved Instances, how they’re used poorly, and how you can use them better, to make the most of your AWS spend.
Those are some of the mistakes that you can make when buying reserved instances, which can end up costing your company a bundle. So, what can you do about them? How do you fix these mistakes and keep from losing money? There are a few options.
1. Flexible Payment Options.
First, let’s address the issue of buying too little RI coverage. In December of 2014, Amazon introduced more flexible billing options. In the past, the entire yearly cost of a reservation had to be paid in advance. Now, customers can also choose to pay half up front and half in monthly instalments or to pay it all from month to month with no payment upfront. No matter which option you choose, you still need to pay for both used and unused compute. However, more flexible payment options make it easier to buy the RI you need. So if you need a Heavy instance but can’t afford it, you can now pay for it over time, rather than settling for the Medium or Light instances and risking it not being enough.
2. Selling RIs.
So what if you buy, say, a Medium and a Light AWS Reserved Instance, but end up using only the Medium? AWS allows you to sell the unused RI to someone else. Register as an RI seller, and you can resell your unused RIs, provided you’ve paid the entire upfront cost already, have owned it for at least one month, and have at least one month left to go. This allows you to recover at least some of your lost money.
3. Modifying RIs.
But what if you only have one RI, and aren’t using nearly all of it? Being that it’s used, you can’t sell it. But what you can do is modify it. AWS allows you to split a single RI into multiple RIs, so that you can sell off what you don’t need while still benefiting from the RI you have. You can also modify it in other ways that allow for more flexibility and fewer losses.
4. Monitoring RIs.
They say an ounce of prevention is worth a pound of cure. The best way to fix your mistakes and optimize your AWS spend is to keep track of your Reserved Instance needs over time and monitor how they change. Then adjust your RI purchases for the next period accordingly. As we touched on briefly already, the more thoroughly you monitor and track your RI usage, the better you’ll be able to optimize your AWS spend as your needs fluctuate.