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What if you discovered a way to significantly reduce your AWS public cloud bill without cutting any of the resources you offer right now? By smart management of your public cloud consumption, you may be able to discount your AWS costs by up to 75%. The secret is leveraging the power of reserved instances.

What are Reserved Instances?

With AWS reserved instances, you can purchase instances ahead of time instead of buying on-demand instances and paying monthly. Switching to reserved instances can result in significant savings on your AWS bill because you’re planning ahead and reserving resources and capacity in advance. If you have a collection of instances that you know you’ll be using for a while, you’ve got the potential to reduce costs using reserved instances.

Why are Reserved Instances Important for Organizations?

With a little planning ahead, you can realize significant cost savings with reserved instances. Because you purchase resources and capacity ahead of when you’ll use them, you’ll pay for them upfront, but spend less over the long term than you would with on-demand instance payments.

While cost savings are probably the most compelling reason for looking into reserved instances, there are other factors you may want to consider. If your business experiences usage spikes, you don’t have to be caught off-guard with resources that don’t meet your needs. You can plan ahead and reserve future capacity to keep on top of the fluctuations in your resource requirements. You can even reserve capacity in another region as insurance against region-wide emergencies.

Reserved Instances Use Case:

Let’s say company XYZ has been spinning up AWS VMs for 5 years for easy access to temporary development and testing environments. They haven’t done much cloud governance in the past but want to start managing their cloud resources so they can cut costs, but don’t want to compromise the freedom of their production groups. They’ve heard about the potential savings of setting up reserved instances, but they’re wary of making costly mistakes. After some research, they set up a smart strategy that involves taking their cloud management project one step at a time. They start by setting up AWS billing data retrieval to get a better handle on their AWS cloud expenses.

After applying rightsizing to optimize performance and power scheduling to power down unused machines, they’ve already gone a long way towards optimizing their systems and cutting costs. Now they’re ready to set up reserved instances.

First, they run the Reserved Instance Planner report to get customized recommendations based on past performance of their systems. The report recommends Reserved Instance purchases for each AWS region, OS and instance type, based on their usage metrics. They can change the settings on the Reserved Instance Planner report to get customized recommendations based on their business goals. For instance, they may choose to receive notices only for situations where the savings is greater than 20%. They can also compare cost savings by running the report over several different reporting periods.

After the report has run, notifications show up in a region’s summary tab if reserved instances are recommended. There’s an option to view more details or ignore future recommendations of this type.

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There’s also a summary of all the reserved instance recommendations.

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Now company XYZ has the information they need to make informed reserved instances purchases and reduce their on-demand expenses. 

Because conditions are always changing, it’s important to point out that cost optimization is an ongoing, iterative process. Once you've rightsized, set power schedules and purchased reserve instances, it's critical to monitor your AWS infrastructure and your bill, and continually optimize.

Embotics Commander and Reserved Instances

To take the guesswork out of purchasing reserved instance, Embotics Commander provides a reserved instance planner report based on real data performance metrics. The report recommends reserved instance purchases for each region and each instance type and shows you the projected savings for each purchase. Recommendations in this report are based on VM history data or AWS billing data if it’s available.

Embotics is a recognized market leader for its cloud management platform Commander, used by both service providers and enterprise.

Interested in seeing how your organization can benefit from reserved instances? Request a demo today with one of our technical experts and see Commander in action.

Start saving on your AWS bill. Request a demo.

The world’s leading companies choose Embotics Commander for managing their private, public and hybrid cloud environment.
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