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Amazon Web Services changes up Reserved Instances discounts

Admittedly, a new pricing scheme for a particular Amazon Web Services function isn't quite as flashy as Cyber Monday, but it's still a potential game changer.
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Written by Rachel King, Staff Writer on

Just because Cyber Monday is behind us doesn't mean Amazon is giving up on the crazy deals just yet.

Admittedly, a new pricing scheme for a particular Amazon Web Services function isn't quite as flashy, but it's still a potential game changer.

On Tuesday, AWS added what it referred to as "a simplification" to the Amazon Elastic Compute Cloud (EC2) Reserved Instance (RI) model.

AWS chief evangelist Jeff Barr explained in a blog post that the changes are in response to "customer feedback with an analysis of purchasing patterns that goes back to when we first launched Reserved Instances in 2009."

Reserved Instances for the EC2 resizable cloud hosting services can be used to reserve capacity, making these customers eligible for a discount on instance usage versus those opting for On-Demand instances.

Up until now, that discount consisted of a lower effective hourly rate so long as customers paid upfront payment.

Now they no longer have to, necessarily speaking.

AWS is introducing a single type of Reserved Instance with three payment options: one upfront payment for the entire Reserved Instance term (one or three years), pay for a portion of the Reserved Instance upfront with installments for the rest over the course of the one- or three-year term, or nothing upfront except the commitment to pay over the course of a one year Reserved Instance term.

The last option still promises discounts up to roughly 30 percent versus current On-Demand instances, compared to up to 63 percent with a three-year Reserved Instance term.

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