AWS reserved instance recommendation

The AWS reserved instance recommendation specifies the number of AWS reserved instances that you must purchase to achieve maximum cost savings.

The recommendation also provides the following information:

• Properties of the reserved instances to be purchased: Instance type, Platform, Region and Availability Zone, Pricing attributes

  The pricing attributes of the recommended reserved instances have the following fixed values:

  Pricing attribute	Value
  Offering class	Standard
  Term	1-year
  Payment option	No upfront

  Depending on your needs, you can choose to purchase reserved instances with other pricing attribute values (For example, Standard Offering class with All upfront payment option for a 3-year term)

• Estimated monthly and annualized savings that you can achieve by purchasing the given number of reserved instances.

Recommendation details

The AWS Reserved Instance recommendation is generated on a daily basis, as follows:

1. The AWS billing data is used to analyze the total compute hours of the existing on-demand AWS instances (VMs). The default analysis period is last 30 days. 
   You can modify the analysis period in the associated Optimizer rule (AWS Reserved Instances).

   To modify the analysis period

   Parameter with default value	How-to resource
   Condition period = Last 30 days	Configuring and managing Optimizer rules

2. VMs with same values for the following attributes are grouped together: Instance type, Region,Operating system.
   
   
3. For every group of VMs, the number of reserved instances that you can purchase to achieve the maximum estimated savings is computed.
   The maximum estimated savings is the difference between the total cost that you are paying for the existing VMs by using the on-demand pricing and the cost that you will pay with the suggested reserved instances.
   
   

4. A recommendation is generated if the estimated monthly savings exceeds a predefined threshold. You can configure the threshold in the associated Optimizer rule (AWS Reserved Instances).
   

   To modify the alert threshold

   Threshold with default value	How-to resource
   Generate a recommendation if the estimated monthly cost savings exceeds $5	Configuring and managing Optimizer rules

Related topics

Optimizing-multi-cloud-costs-with-out-of-the-box-recommendations

Recommendation-types