12 for '21 Cloud Optimization Series - Number Seven: Spot Pricing

Cloud spend is anticipated to continue its massive growth trajectory for the foreseeable future.  However, the spend does not have to match that same growth curve!  To help our Clients maintain sound Cloud Optimization programs, we've assembled a series of articles and tips called: 12 for '21 Cloud Optimization Series (note: request a download of all 12 here).

Our seventh chapter in the series: Use Spot Pricing

Spot Instances are spare compute capacity  at a steep discount (up to 90%) to On-Demand Instances. Spot Instances can go down with very little notice. While they are frequently used to supplement On-Demand Instances, they aren’t meant to handle 100% of your workload due to the potential service disruption. In the spot instance model, you receive compute instances through a bidding process, in which you specify the hourly price you are prepared to pay. You bid your price, and when an EC2 instance is offered at that price, the instance is launched.

When to Use Spot Instances?

Spot Instances are well-suited for fault-tolerant and flexible applications. Some common use cases include: 1)Web services 2) Batch Processing 3) large scale testing 4) Big data analytics 5) Parallel computation 6) Machine learning . They may also be helpful to add capacity to infrastructure that is already running on On-Demand Instances.

When to Avoid Them

Spot Instances are not a good choice for sensitive workloads, databases or client-facing systems that require dedicated resources or cannot recover e.g., web servers or backend APIs where up-time is critical. 

Spot Instance Best Practices

There are several factors to keep in mind if you choose to use spot instances in staging, testing or production environments.  The most important best practices include:

  • Use Spot Fleets (AWS) - Spot Fleets are collections of Spot Instances that automatically launch to meet a target capacity. They make it a lot easier to manage Spot Instances in the aggregate.
  • Look for  right instances and regions - Some Spot Instances have less price volatility than others, it is usually a function of  instance types and/or location. Pick  these ones  in priority  to avoid unexpected price increases.
  • Ensure Continuity - EC2 Spot Instances can be configured to  pause and resume as capacity becomes available. This is a convenient feature to keep in mind and  to avoid sudden crash or data loss.

The Bottom Line

Spot Instances could play an important role in lowering your compute  costs. In addition to the common use cases we’ve covered above, you may want to explore ways to use it in production web servers to realize significant savings or other unconventional strategies that might make sense for your specific situation.

About NET(net)

Founded in 2002, NET(net) is the world’s leading IT Investment Optimization firm, helping clients find, get and keep more economic and strategic value. With over 2,500 clients around the world in nearly all industries and geographies, and with the experience of over 25,000 field engagements with over 250 technology suppliers in XaaS, Cloud, Hardware, Software, Services, Healthcare, Outsourcing, Infrastructure, Telecommunications, and other areas of IT spend, resulting in incremental client captured value in excess of $250 billion since 2002. NET(net) has the expertise you need, the experience you want, and the performance you demand. Contact us today at info@netnetweb.com, visit us online at www.netnetweb.com, or call us at +1-866-2-NET-net to see if we can help you capture more value in your IT investments, agreements, and relationships.

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