April 19, 2023 By Dina Henderson 4 min read

How IBM Turbonomic can help you manage AWS EC2 pricing and usage while assuring your application’s performance.

Amazon Elastic Compute Cloud (EC2) is the most widely used service on AWS. It provides compute capacity in the cloud and has a wide range of virtual machines (VMs) known as EC2 instances. These instances run an operating system on top of resources like CPU, memory and hard disk. With hundreds of different instance types at various price points, managing AWS EC2 pricing and usage can be a challenging task, but IBM Turbonomic can help identify which virtual machine instances are best suited for particular workloads.

Selecting the right VM instances

When it comes to managing EC2 pricing and usage, choosing the right VM instance is crucial. Each instance type is optimized for a specific use case, such as compute-intensive workloads, memory-intensive workloads or storage-intensive workloads. The instance type determines the resource capacity of the virtual machine and hourly pricing. You can do this manually from the AWS Management Console, and you are only charged for the instances while they are running. When you’re done with your instances, you can spin them down and stop paying for them.

The following is a list of EC2 families and their corresponding specifications on AWS’ website, which are accessible through the given links:

With Turbonomic, users can easily identify which virtual machine instances are best suited for their workloads based on their performance requirements and budget. Our software continuously analyzes EC2 usage patterns in real-time and recommends the most cost-effective virtual machine instance that meets performance needs. Users can ensure they are using the right virtual machine instance for their workload and not overspending on unnecessary compute resources.

Optimizing EC2 pricing

Managing EC2 pricing can be a challenging task, especially when dealing with a large number of instances. EC2 pricing depends on several factors, such as instance type, region, operating system and usage time, making it difficult to keep track of costs and optimize efficiently.

Turbonomic simplifies this process by providing real-time visibility into usage and costs, analyzing usage patterns, and generating cost-saving actions without sacrificing performance. Additionally, our software helps right-size instances by identifying underutilized instances and recommending more cost-effective instance types.

After deciding on the EC2 instance that best fits your use case, you’ll need to choose a pricing option. AWS offers a few EC2 instance pricing options, such as On-Demand pricing, Savings Plans, and Reserved Instances. In this post, we’ll only be mentioning On-Demand pricing and Reserved Instances.

On-Demand pricing allows you to pay for the compute capacity you need without any long-term commitments in a pay-as-you-go model. Reserved Instances (RIs) allow you to reserve EC2 capacity over a period of one to three years at a yearly discounted rate compared to On-Demand pricing. Turbonomic’s actions are RI-aware, and our software scales virtual machines to maximize RI utilization.

AWS EC2 pricing: On-Demand

On-Demand EC2 pricing provides you the convenience and flexibility of choosing any instance type and size and paying only for what you use, with no upfront payments or long-term commitments. Billing is done per hour or per second, and prices vary based on the instance type and size, the operating system,and the region.

On-Demand pricing for EC2 instances is available for all operating systems, regions, and availability zones, and it is the default pricing option. However, its cost varies depending on the same parameters. Although On-Demand EC2 pricing offers convenience and flexibility, it’s also the most expensive option. It’s best suited for unpredictable workloads or applications.

AWS EC2 pricing: Reserved Instances

Opting for Reserved Instance EC2 pricing can result in significant cost savings of up to 72% compared to On-Demand EC2 pricing. In addition, you’ll have the ability to reserve capacity in a specific availability zone, simplifying the process of launching new instances on an as-needed basis. This option requires a commitment to consistent usage for a duration of one to three years.

The amount of discount you’ll receive through Reserved Instance EC2 pricing is determined by your upfront payment. Paying the full amount upfront results in the largest discount and greatest savings. Partial upfront payment is another option, with a lower discount but lower upfront costs. Finally, if you prefer not to pay anything upfront, you can still benefit from a smaller discount and allocate the saved funds to other projects.

If you want to learn more about AWS EC2 pricing, check out the Amazon EC2 pricing page.

Get started

Managing EC2 pricing and usage can be a complex and time-consuming task, especially as workloads grow. With IBM Turbonomic, you can simplify the process and optimize your cloud for maximum efficiency and cost savings. By selecting the right VM instances and optimizing your costs, you can ensure that you’re getting the most out of your EC2 instances while keeping your cloud costs under control.

IBM Turbonomic can help you manage AWS EC2 pricing and usage while assuring your application’s performance. Get started by trying out the IBM Turbonomic Trial or request your IBM Turbonomic demo today.

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