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Amazon Cloud Journal: Blog Post

AWS Reserved Instance Purchases Made Simple

A short reference for calculating provisioning needs and optimizing Reserved Instance purchases

Reserved Instances offer AWS users an opportunity to reduce their bills by over 50%. So, here is a six-step process to help purchase Reserved Instances.

Step #1: Size your instances. Check your utilization metrics so that you are correctly provisioned. Remember, AWS is elastic - so do not rely the data center only use 20% rule. Instead, architect horizontally, construct auto scaling groups, and be comfortable with higher utilization levels.

Step #2: Compile your concurrent usage. Properly choosing Reserved Instance purchases require tracking concurrent instance usage. Reservations function like coupons and can only be used 1x per hour. So, knowing how long any particular instance is running does not help.  You must know when instances are running to compile a map of matching instance sizes, AZ, and platforms.

Step #3: Compare your usage against your Reserved Instances. When doing this, pay particular attention to AZ and/or size mismatches from your current usage to your purchased Reserved Instances. AWS allows users to resell unused reservations, move Reserved Instances across AZ, and alter their size within instance families - smart users take advantage of the capabilities.

Step #4: Calculate the ROI for additional purchases. With your concurrent usage, you can calculate an optimal number of Reserved Instances to generate a particular ROI or to optimize available investment capital for upfront costs.

Step #5: Purchase your Reserved Instances.

Step #6: Repeat steps #1-4 on a regular basis. Business needs and AWS usage are often dynamic - as your needs and usage changes, you should reevaluate your Reserved Instance purchases

All six of these steps are essential for optimizing your Reserved Instance purchases. Shortcuts will lead you astray and leave you wasting money. The steps are short - but can be time consuming. All can be done manually - but may be time consuming. If you have a large, multi-account, or complex deployment, it makes sense to use an automated tool from CloudCheckr or other third parties to facilitate the process.

Either way, Reserved Instances offer AWS user an opportunity to save a lot of money.

More Stories By Aaron Klein

Aaron Klein is Co-Founder and COO of CloudCheckr Inc. CloudCheckr Inc. provides a comprehensive solution (CloudCheckr Pro) that addresses the infrastructure reporting, monitoring, and control needs of AWS users through automated and customizable reports, alerts, and recommendations. Its cost, security, resource, best practice, and change monitoring analytics and features allow users otherwise unavailable insight into their deployments and usage. CloudCheckr Pro is designed to help users optimize their deployment.