AWS Savings Plans vs Reserved Instances

AWS Savings Plans offer greater flexibility compared to Reserved Instances, making them a preferred choice for many customers seeking cost savings without being tied to specific instance types. While Reserved Instances provide significant discounts by committing to specific instance types and terms, they can be complex to manage due to the wide array of options and the potential need for organizational infrastructure changes. In contrast, AWS Savings Plans, introduced in late 2019, allow users to commit to a certain amount of spending, granting the highest possible savings across various services like AWS Fargate, AWS Lambda, and AWS SageMaker, regardless of the specific instance type. The flexibility of AWS Savings Plans enables organizations to adapt their infrastructure needs over time while maintaining the same discount rates, which can range from 20% to 70%, depending on the term and payment options chosen. This adaptability makes AWS Savings Plans an advantageous option for businesses experiencing growth and change, as they can easily switch between different services and instance types while still benefiting from substantial savings.