
Simplifying the EC2 Reserved Instance Model - ajdecon
https://aws.amazon.com/blogs/aws/simplified-reserved-instances/
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wise_young_man
This is great. I kept telling my developer colleagues that AWS EC2 could get
more affordable as we scaled and bought reserved instances.

As a bootstrapped startup paying for a year or three years upfront is quite a
bit of a burden, but I think this is great progress and will make that easier
on us.

I also like Google Cloud's sustained use discounts because it is automatic.
I'm not sure if AWS will ever do that, but since I'm such a huge fan of AWS,
I'd love it. [1].

[1]:
[https://cloud.google.com/compute/pricing#sustained_use](https://cloud.google.com/compute/pricing#sustained_use)

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Yadi
Ah Jeff! I love how this guy actually write and simplifies the technologies.

This is one easy way for non-cloud users to pickup EC2 and use it as hosting
services and demystify the price VS usage behind it.

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jeffbarr
Thank you -- this comment made my day!

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Yadi
Ah you are here Jeff! You da man, seriously I read most of your blogs, because
I have been self-taught & I appreciate when people write good stuff to make
you learn rather than just selling. :)! Kudos!

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prohor
Still this is far less simple than Google's "sustained use" discounts, where
price automatically drops when I have more constant use pattern. Here I still
need to plan upfront, assume my future usage patterns. It seems easier, but in
fact you need to make the same decisions as previously.

I also wonder what happens if I make "no upfront" reservation and don't use
it? If nothing - why would I use on-demand, while I always can do reservation
without upfront?

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snewman
"No Upfront - You pay nothing upfront but commit to pay for the Reserved
Instance over the course of the Reserved Instance term". Presumably, you'll be
billed each month (for 12 months) whether you're using it or not. Of course,
if you close your AWS account entirely, they'd have to come after you if they
wanted to collect -- but if you're not planning to go out of business, then
you shouldn't expect to be able to just drop the instance mid-year.

~~~
prohor
OK, then it would behave as the old heavy reservation.

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jasonefrank
I would also love to be able to move across instance families. Another reason
not to commit for a long period of time. I'm willing to say "I'm committed to
using x amount of AWS computing power over the next 3 years" but not if that
will prevent me from using any of the new instance families that come out over
that time frame.

~~~
cperciva
Ah, but that's the whole point. Amazon wants to buy hardware and know that
it's going to get used.

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jasonefrank
I certainly understand that Amazon's interests are different from mine, and
they are going to make offerings that are good for them. But the best offers
are win-win, and a 3-year RI doesn't meet that bar. It's a bad offer for the
customer, but masquerades as a good offer. Not unique in the world of
business, "buyer beware" and all that of course. It was my bad for not fully
appreciating the lock in and avoiding it.

~~~
cperciva
_It 's a bad offer for the customer_

Not necessarily. Some people won't want to move between server families
anyway. It's up to the customer to figure out if what Amazon is offering is
good for them or not.

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jasonefrank
Pet peeve in case Jeff Barr (or another AWS person) reads this. I purchased
multiple 3-year heavy utilization RIs just a few months before the price wars
last year. The ROI on those went from "great" to "very modest" overnight. I
know there is an RI Marketplace where I could try to sell them, but as the on-
demand prices went down so far, I would not be likely to get a decent deal. It
felt like the best customers, those who have committed for multiple years,
were being left out in the cold. I will not be doing any long-term (over 1
year) RI purchases again unless they make it possible to participate in price
drops.

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runamok
That is the whole point. The price IS going to go down overt time. So by
getting you to commit to a price Amazon can more accurately predict their
growth and you get a fairly decent discount in trade. 1 year terms are much
wiser IMHO because of the constant price lowering.

~~~
jasonefrank
Agreed, 1 year is the sweet spot here. I didn't appreciate the opportunity
cost of getting the 3-year RI, as much as the straw man "savings" against the
current on-demand prices.

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Someone1234
They didn't hit any of my pain points.

The payment schemes weren't particularly complex/annoying. What is annoying is
that when you purchase a RI you cannot just point at an existing VM and have
the RI both bind to that but also select the right availability zone and
location (e.g. 1A, 1B, 1C, 1D, East, West, Central, Europe, etc). I've had to
go through the painful process of migration from 1B to 1C because I mistakenly
purchased US-East-1B instead of US-East-1C.

Plus there is something to be said for Azure's "you can always upgrade it"
model. RIs are great price wise, but Amazon won't let me buy e.g. a small RI
and then pay the difference to upgrade the RI to a medium or large (even if
they have to extend the RI to do so).

This is really the most welcome change (NOT listed in the blog):

> On February 2nd 2015, Light and Medium Utilization Reserved Instances will
> no longer be available for purchase.

Light and medium RIs were too complicated. It was also too hard to track your
RI usage in the way you'd need to to manage those plans, it is just easier to
do on demand pricing with a few heavy utilisation RIs.

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cheald
> Amazon won't let me buy e.g. a small RI and then pay the difference to
> upgrade the RI to a medium or large

You kinda can - when you purchase RIs, you're really just purchasing a chunk
of capacity ("Units" in EC2 parlance). You can reallocate your units into
different RIs, so if you bought a c3.2xlarge and want to upgrade it to a 4x
large, you'd just buy a second 2xlarge and then recombine your two 2xlarges
into a 4xlarge. Or you could split a 32-unit 4xlarge into 4 8-unit 1x larges.

ie, 2x c3.xlarge
([http://i.imgur.com/hPl2WNJ.png](http://i.imgur.com/hPl2WNJ.png)) recombine
into 1x c3.2xlarge
([http://i.imgur.com/KhthjYo.png](http://i.imgur.com/KhthjYo.png))

Granted, you can't jump from a medium to a large; it only works within the
same product class. But it does provide upgrade paths. It is bass-ackwards,
though. And the fact that they sell "instances" rather than "units" but don't
let you bind RIs to actual instances is confusing as all get-out.

~~~
nkvoll
What you're saying is not really correct.

You cannot just "buy a second 2xlarge" and then recombine them into a 4xlarge.
The 2xlarge reservations _and pay attention here_ need to match on their
purchase _date_ and _hour_. I.e they have to be bought within the same clock
hour on the same day.

If you reserved a 2xlarge at 2014-12-01T22:59:59Z, you couldn't even combine
it with one bought at 2014-12-01T23:00:01Z. Yes Amazon is _that_ picky about
it. While you _might_ be able to muscle that through a sales contact, it's not
even available to customers on business level support, so anything more than a
day apart and you're likely out of luck in any case.

(See: [http://docs.aws.amazon.com/AWSEC2/latest/UserGuide/ri-
modify...](http://docs.aws.amazon.com/AWSEC2/latest/UserGuide/ri-
modifying.html#ri-modification-limits), particularly bullet point #6)

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cheald
Ah, I didn't realize this. Wow, that's...restrictive. Thanks for the info.

