Something strange started happening at re:Invent last year. Yes, I realize that absolutely doesn’t narrow it down one bit, but this one is germane to my Cloud Economics day job. Specifically: new EC2 instances started launching without Reserved Instance support. If you check the pricing pages for the trn2, p5e, i8g, f2, and i7ie instance families, you’ll note that they don’t show up with reserved instance pricing—just Savings Plan discount rates.
The writing’s been on the wall for RIs for a while now. Savings Plans are the way forward; they offer the same discount percentages as Reserved Instances, with a lot less manual work to get there. True, they don’t offer the Convertible RI Double Irish with a Twist*, but I can’t help but feel that this is considered a benefit by folks at AWS tired of customers’ doing an end run around their commitment structures.
I’ve wondered for a while how AWS was going to get to a point of Savings Plan adoption as the single path forward. It was pretty obvious that there wasn’t going to be a hard cut-off of no more RI purchases past [some arbitrary date], so phasing them out this way seems to be the most customer-centric solution.
Note that a far more customer-centric solution would include folding RDS, OpenSearch, Redshift, and other services that use their own bespoke RIs into a unified Savings Plan too—but it’s clear that those teams are too interested in empire-building. We’ve seen where that leads, with SageMaker-specific savings plans: customers have to decide up front whether or not they’re going to build on EC2 or a more managed service. Unlike Fargate or Lambda, which quite sensibly folded their discount structures into Compute Savings Plans, these teams built their own structure that locks customers into architectural decisions via economic factors—in many cases, keeping customers from adopting services that both AWS and the customers themselves would prefer.
For customers, this is unlikely to be a significant change. Case in point, it’s been four months, and I haven’t found folks to be particularly concerned about the change. Most of them are learning about it from this post. It just doesn’t matter to most customers in 2025; they’ve switched to Savings Plans years ago, and are happier for it.
However, this likely is the turning point for an awful lot of businesses that model RI spending in “creative” ways. In a few years when Savings Plans are all that exist on modern instance types, you won’t need some vendor taking a percentage of your AWS bill; you’ll use AWS’s own free (and excellent) Savings Plan Purchase Analyzer, take the recommendation, and then purchase them on a reasonable cadence. Our own Reserved Instance guide will become an interesting historical footnote, as its companion Savings Plan guide becomes the only relevant document of the two.
Overall this is a win for customers; they don’t have to stop what they’re doing today, but they absolutely should be keeping an eye towards the future of AWS discount vehicles—and modernizing their processes to suit.
*The Convertible RI Double Irish with a Twist: Buy a tiny RI every month on a no upfront 1 year. In the 11th month, exchange that tiny RI for, say, 10K c8G.24xlarge instances. Yes, you can turn a tiny RI into many much larger ones, without resetting the commitment length. You get all the discounting of the RI, with only a one month commitment for that spend level. It’s super handy for variable workloads, and isn’t hard to automate.
