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AWS Pricing & Billing

EC2 Pricing & Billing Options



Overview of AWS Pricing Options


On-Demand – for short workloads, pay by second


Reserved – 1 or 3 years – for long workloads


Convertible Reserved – long workloads with flexible instances


Savings Plans – 1 or 3 years – commits to a fixed usage, for long workloads


Spot – short workloads, can be cancelled at any time by AWS according to general load of other customers, very cheap


Dedicated Host – book entire physical machine and control instance placement


Dedicated Instance – no other customers share hardware


Capacity Reservation – reserve capacity in a specific AZ (Availability Zone) for later use



Pricing Options in Detail




has highest cost, no long-term commitment, best for short-term loads


Reserved Instances


72% max discount vs on-demand, you reserve specific instance attributes


specify reservation period eg 1 year


payment – upfront or not upfront, discount for upfront


scope – in specific region or AZ


recommended for stead state loads eg database apps


you can buy and sell them in the reserved instance AWS marketplace



Convertible Reserved Instance


allows you to change the EC2 instance spec




Savings Plans


discount acc to long term usage as for Reserved up to 72%


commit to certain type of usage, eg $10 per hr for 1 or 3 yrs


Usage beyond this is billed at on-demand price


but you are locked to a specific instance type and region


however you can change instance size and OS, and tenancy – host, dedicated default – can change this


Spot instances


up to 90% discount


the most cost-efficient


good for resilient to failure loads, eg batch jobs, data analysis, flexible jobs

NOT suited to databases!



Dedicated Hosts


you get a physical server dedicated to your own usage


advantageous for compliance requirements and server/hw-bound licenses for software eg per socket/core/CPU etc


the most expensive option in AWS


can be on demand pay per second

or reserved – 1 or 3 yrs with no-upfront, partial upfront, no upfront



Dedicated Instances


run on hw dedicated to you, but you may share the hw with others in the SAME ACCOUNT


but you don’t have access to the actual hardware, unlike dedicated host – important difference


no control over instance placement


suitable for short-term uninterrupted workloads that need to run in a specific AZ



AWS Pricing Calculator


The AWS Pricing Calculator is a web-based planning tool for creating budget estimates for your AWS projects before building them.


AWS Pricing Calculator is available free of charge via a web-based console at https://calculator.aws/#/


You do NOT need an AWS account in order to use the Pricing Calculator.


It provides an estimate of your AWS fees and charges, but the estimate doesn’t include any applicable local sales taxes.





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AWS – Setting Up A Billing Budget

In order to grant permissions to your admin user to use billing, you must first login as your AWS Root Account 


In AWS Management Console -> My Account: 


Then click on IAM User and Role Access to Billing Information


edit -> activate IAM Access and click update


then you can go to your admin user account in the AWS Management Console (logout of root) and you should now have access permission to Billing and Cost Management Dashboard.



You can call up your bills, and see exactly what charges are being incurred for which service and for which time period.


You can also display the Free Tier Services 


Next, set up a cost budget. Choose a recurring fixed budget and set a value eg 10 USD for the course.

Set at least one threshold alert to send an email when this is reached, eg at 80%


and also a forecast alert, eg 60% if it looks like this will be reached, you will be sent an email.


















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