Reserved Instance Marketplace and Convertible Reserved Instance purchases do not qualify for the volume discount but the list value for these purchases will count towards your volume discount status. Also, due to the scale of Microsoft licensing fees, volume tier discounts are not available for Windows with SQL Server Reserved Instances. Please note that Reserved Instance purchases of Windows with SQL Server are not included in the computation of volume tier discounts. For an in-depth example, please visit the EC2 Reserved Instances FAQ. On-Demand instance prices in the Asia Pacific (Osaka-Local) region are for reference and only apply when Reserved Instances expire and are not renewed.Īmazon EC2 Standard Reserved Instance Volume Discountsįor example, as soon as you have aggregated active Reserved Instances with a List Value totaling more than $500,000 in a single AWS Region, you will automatically receive a 5% discount on both upfront and hourly fees for all future Standard Reserved Instance purchases in that AWS Region, and those discounts will continue to apply to new Standard Reserved Instances as long as you continue to qualify for the discount tier. Note: The Asia Pacific (Osaka-Local) region only offers Reserved Instances and Spot Instances. The effective hourly price shows the amortized hourly cost of the instance (this takes the total cost of the Reserved Instance over the entire term, including any upfront payment, and spreads it out over each hour of the Reserved Instance term). When you purchase a Reserved Instance, you are billed for every hour or second during the entire Reserved Instance term that you select, regardless of whether the instance is running or not. **Effective hourly pricing is shown to help you calculate the amount of money that a Reserved Instance will save you over On-Demand pricing. The hourly usage rate is equivalent to the total average monthly payments over the term of the Reserved Instance divided by the total number of hours (based on a 365 day year) over the term of the Reserved Instance. For each month, the actual monthly payment will equal the actual number of hours in that month multiplied by the hourly usage rate or number of seconds in that month multiplied by the hourly usage rate divided by 3600, depending on the EC2 instance type you run. Even with a slowdown of Moore's Law, it seems like AWS has a healthy margin to continue to offer strategic price cuts only when necessary.*This is the average monthly payment over the course of the Reserved Instance term. Two months after Cloudflare announced their free egress storage solution, R2, AWS cut prices on certain S3 products.Īnother blog post analyzes the same theory for compute and finds a similar story using pricing data from AWS EC2. S3 seems simple on the surface but is not a commodity. It follows that AWS has strong pricing power when it comes to storage, even with API-compatible competitors from Google and Microsoft. Of course, prices vary by storage tier and region, but this seems to be a general trend. This doesn't include the additional fees like egress. Yet, AWS S3 pricing hasn't decreased as fast as the underlying storage costs. It is massively complex and sits behind a simple ( simple storage solution) API. So popular that its API has become a de facto standard that other clouds have adopted. AWS S3 is the fundamental cloud storage service. As a result, many of these companies faced strong downward pricing pressure and slim margins.īut cloud storage is different. Capacity and speed increased exponentially every year. At every point, companies failed to make the switch from 8-inch drives, to 5-inch drives, to 3.5-inch drives. (h/t Peter Cai for the graph) /ZdZrgIh8bQ- Matt Rickard March 18, 2021Ĭlayton Christensen famously demonstrated the Innovator's Dilemma by using data from the hard drive industry in the 1980s.
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