One of the main concerns newcomers have with Amazon Elastic Compute Cloud (EC2) is: how much will this service cost me?
Firstly, Amazon EC2 is a pay-as-you-go service where you are billed on your usage on a monthly basis. Your bill depends on your region, how many virtual computers (called instances) you rent, how much computing power you want them to have, and the payment tier you want to use. Secondly, you can do a projection of your monthly bill using the AWS Simple Monthly Calculator tool.
- Free — This is a useful service for determining whether or not Amazon EC2 is for you. The Free Tier lets you use Amazon EC2 free of charge for one year. Note that there are monthly limitations to the number of usage hours (750 in all), the processing power, the block storage size, and the speed of the data transfer.
- On-Demand — With the On-Demand Tier, you pay an hourly rate for the instances, for as long as you require them. The rates vary from region to region, as well as the operating system, instant type, and how many instances you decide to use. Follow the link above to check the current prices per region and instance.
- Reserved — You may also choose to reserve your processing capacity. This entails paying up front, but the upside is that you can get up to 75% discount on the rate. You may reserve processing capacity in three ways:
- All Upfront — provides the largest discount
- Partial Upfront — you pay a low upfront payment and a discounted rate thereafter
- No Upfront — zero upfront payment with a discounted hourly rate
- Spot — Just like in the commodities market, you can bid for unused capacity on AWS. To use Spot Pricing, you specify a Spot instance request with specific instance type, number, and the maximum price you want to pay. Once the Spot Price falls below this requested amount, your instances will activate, and if the Spot Price rises above it, they will terminate.
Apart from the tiers, you may also include optional features like Amazon Elastic Block Store, Elastic IP Address, CloudWatch, Auto-scaling, Data Transfer, and others. As prices do change, follow this link to see the updated Amazon pricing table for all tiers. If you want to quickly learn how to use the Amazon Simple Monthly Calculator, check out our tutorial on this simple yet powerful tool.
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