What are reserved instances and how can they benefit startups?

What are reserved instances and how can they benefit startups?

Reserved instances are a pricing model offered by cloud providers that allow you to reserve capacity for a specific period, usually one or three years, at a lower rate than on-demand pricing. For startups, this can lead to significant cost savings and predictable budgeting.

How do I decide if reserved instances are right for my startup?

To determine if reserved instances are right for your startup, consider your usage patterns. If you have steady, predictable workloads, reserved instances can save you money. Analyze your current and projected usage to make an informed decision.

What are the different types of reserved instances available?

There are typically three types of reserved instances: Standard, Convertible, and Scheduled. Standard reserved instances offer the most significant savings but are less flexible. Convertible reserved instances allow you to change instance types, while Scheduled reserved instances let you reserve capacity for specific time slots.

Can I change or cancel my reserved instances?

Most cloud providers have specific policies regarding changes and cancellations. Generally, you can modify or exchange convertible reserved instances, but standard ones are usually non-refundable and cannot be changed once purchased.

What are the potential downsides of using reserved instances?

The main downsides include the commitment to a long-term contract, which can be risky if your needs change. Additionally, if you overestimate your capacity needs, you may end up paying for unused resources.