The premise behind reserved instances is a relatively simple one…. by reserving virtual machine instances over a one or three year term, you’ll potentially save up to 70% in running costs the process.
This can equate to a significant saving, provided there is some predictability with the resource requirements of the workloads that sit in the cloud. The screenshots below shows the comparison between VM instances on PAYG, 1 year reserved and 3 year reserved based upon a server with 4 Cores, 16GB Ram.
Pay as you go:-
1 Year Reserved Instance (RI)
3 Year RI
Over a 3 year term therefore, a PAYG VM instance would cost circa £4955, whereas the 3 year reserved instance works out to be just over £2140, a worthwhile saving when multiplied by several instances.
Some of the main considerations around RI’s are as follows:-
- Reserved instances are purchased with a single up front payment for a one year, or three year commitment.
- You are able to reserve instances under an EA
- You can assign reserved instances can be assigned at the enrolment or subscription level.
- You can exchnage or cancel a reserved isntance
- An exchange allows you to recieve a pro-rata refund based on the unused amount, which applies fully to the purchase price of a new Azure Reserved VM Instance. (There are some restrictions placed on exchanges)
- A cancellation terminates the agreement, you’ll recieve a pro-rata refund based upon the remaining term as well as a 12 percent early termination fee.
- Reserved instances isnt available for the following:-
- Classic VM’s
- Cloud Services VM’s
- A-Series, AV2- Series or G Series
- Dev/Test Subscriptions
- Supressed Core VM’s
- Any Promotional VM
This information and more is published on Microsofts website with a detailed FAQ here.
If there are any unanswered questions or you want to know more about Reserved Instances in Azure then feel free to get in touch.