Reserved Instances
Reserved Instances are a pricing model offered by cloud providers like AWS, Azure, and Google Cloud that allows users to reserve compute capacity for a fixed term (typically 1 or 3 years) in exchange for significant discounts compared to on-demand pricing. They provide cost savings for predictable, steady-state workloads by committing to a specific instance type, region, and operating system upfront. This model helps organizations optimize cloud spending by reducing the variable costs associated with on-demand usage.
Developers and organizations should use Reserved Instances when they have predictable, long-running workloads such as production servers, databases, or batch processing jobs that require consistent compute capacity. They are ideal for reducing cloud costs in scenarios where usage patterns are stable, as they offer savings of up to 75% compared to on-demand pricing. This is particularly valuable for budgeting and financial planning in cloud environments, making it a key skill for DevOps and cloud architects focused on cost optimization.