AWS has stopped selling Light and Medium RIs. Now what?
We all knew it was coming… and now it’s official. Amazon Web Services has officially ceased offering Light, Medium, and Heavy Reserved Instance types in place of the new All Upfront, Partial Upfront, and No Upfront Reserved Instance types that were introduced in December of last year.
Out with the old, in with the new
Many AWS users in our system have anticipated this change and are taking it in stride. In fact, All Upfront, No Upfront , and Partial Upfront account for 70% of the 22,500 new RI purchases that we’ve seen in our system since the new types were made available. Of those, Partial Upfront accounts for the majority of the new RI types purchased, with All Upfront coming in a close second.
We have, however, seen a number of orgs continue to purchase old Reserved Instance types as they’ve remained available—primarily Heavy and Medium types.
Heavy Reserved Instances are effectively identical to the new RI types, so making the transition shouldn’t represent a significant change for users who’ve recently purchased Heavies. However, there isn’t a new equivalent for Medium and Light Reserved Instances, and the orgs which have persisted in purchasing those types will have to re-assess their purchasing strategies now that their options have changed. And as we’ve discussed before, the discontinuation of Light and Medium Reserved Instances represents a significant change in the stakes of Reserved Instance buying—so those strategies need to be rock solid.
The new reality
Now, no matter which Reserved Instance type you choose, a purchase means a big commitment—because all three of the new types require that you pay for all of the hours of the 1-or 3-year term. You’ll pay at a discounted rate, but you’ll still pay for every single hour—so if your reservations aren’t being used regularly, you’ll not only fail to accrue the savings you’d hoped for, but risk taking a serious loss on the purchase.
Whereas 1-year Light and Medium RI purchases would typically reach a breakeven point around 20-40%, the breakeven point for a 1-year All Upfront m1.xlarge is twice that at just past 60%. If it isn’t being used at least 60% of the time over the reservation term, you’ll be in the red.
For one, this means that you won’t have the luxury of low-cost capacity reservations anymore; in place of a low-commitment Light reservation, you’ll have to use one of the new RI types and take a bigger hit to your wallet in exchange for that just-in-case capacity guarantee. It also means that you’ll have to be extremely careful with your calculations when planning these high-stake purchases—and that ongoing management of your reservation portfolio is more important than ever to ensure maximum savings.
Embracing the change
We’re pleased to see that so many of our users are already trying the new Reserved Instance types, but we also know that this is a confusing time for many. So whether you’ve already purchased a whole bunch or are finally ready to try them for the first time, we’re here to help—with a Reserved Instance Planner that can ensure that you invest your money wisely and achieve the greatest savings RIs can offer.