AWS EC2 Instance Costs
Amazon Elastic Compute Cloud (Amazon EC2) is a web service provided by Amazon Web Services (AWS) that allows users to rent virtual servers, known as instances, in the cloud. These instances can be used to run applications, host websites, process data, and more.
Each instance has a unique identifier and a set of attributes, such as its CPU type, memory, storage, and networking capabilities.
Five Main Drivers Affecting Instance Cost
- Instance Purchasing Options
- Tenancy
- Amazon Machine Image (AMI)
- EC2 Instance Types
- Storage Type and Size
Instance Purchasing Options
Watch: Instance Purchasing Options
On-Demand Instances:
- Pay for compute capacity per second or by the hour
- No long-term commitments or upfront payments
- Use case: Short-term, spiky, or unpredictable workloads
- Watch Video
Reserved Instances (RI):
- Up to 72 percent discount compared to On-Demand Instances
- Prepay for capacity (1-year or 3-year options)
- Use case: Predictable workloads lasting longer than 1 year
- Watch Video
Savings Plans Instances:
- Two types: Compute Savings Plans (up to 66% discount) and EC2 Instance Savings Plans (up to 72% discount, similar to Standard RIs)
- Apply to EC2, AWS Fargate, and AWS Lambda usage
- Use case: Long-term workloads, flexible computing needs
- Watch Video
Spot Instances:
- Purchase unused EC2 capacity at up to 90% off on-demand pricing
- Prices controlled by AWS based on supply and demand
- Use case: Flexible start/end time applications, low-cost computing needs, urgent computing needs for additional capacity
- Watch Video 1, Watch Video 2
