Contributed by Deepthi Chelupati and Roshni Pary

Amazon EC2 Spot Instances offer spare compute capacity in the AWS Cloud at steep discounts. Customers—including Yelp, NASA JPL, FINRA, and Autodesk—use Spot Instances to reduce costs and get faster results. Spot Instances provide acceleration, scale, and deep cost savings to big data workloads, containerized applications such as web services, test/dev, and many types of HPC and batch jobs.

At re:Invent 2017, we launched a new pricing model that simplified the Spot purchasing experience. The new model gives you predictable prices that adjust slowly over days and weeks, with typical savings of 70-90% over On-Demand. With the previous pricing model, some of you had to invest time and effort to analyze historical prices to determine your bidding strategy and maximum bid price. Not anymore.

How does the new pricing model work?

You don’t have to bid for Spot Instances in the new pricing model, and you just pay the Spot price that’s in effect for the current hour for the instances that you launch. It’s that simple. Now you can request Spot capacity just like you would request On-Demand capacity, without having to spend time analyzing market prices or setting a maximum bid price.

Previously, Spot Instances were terminated in ascending order of bids, and the Spot price was set to the highest unfulfilled bid. The market prices fluctuated frequently because of this. In the new model, the Spot prices are more predictable, updated less frequently, and are determined by supply and demand for Amazon EC2 spare capacity, not bid prices. You can find the price that’s in effect for the current hour in the EC2 console.

As you can see from the above Spot Instance Pricing History graph (available in the EC2 console under Spot Requests), Spot prices were volatile before the pricing model update. However, after the pricing model update, prices are more predictable and change less frequently.

In the new model, you still have the option to further control costs by submitting a “maximum price” that you are willing to pay in the console when you request Spot Instances:

You can also set your maximum price in EC2 RunInstances or RequestSpotFleet API calls, or in command line requests:

$ aws ec2 run-instances --instance-market-options 
'{"MarketType":"Spot", "SpotOptions": {"SpotPrice": "0.12"}}' \
    --image-id ami-1a2b3c4d --count 1 --instance-type c4.2xlarge

The default maximum price is the On-Demand price and you can continue to set a maximum Spot price of up to 10x the On-Demand price. That means, if you have been running applications on Spot Instances and use the RequestSpotInstances or RequestSpotFleet operations, you can continue to do so. The new Spot pricing model is backward compatible and you do not need to make any changes to your existing applications.

Fewer interruptions

Spot Instances receive a two-minute interruption notice when these instances are about to be reclaimed by EC2, because EC2 needs the capacity back. We have significantly reduced the interruptions with the new pricing model. Now instances are not interrupted because of higher competing bids, and you can enjoy longer workload runtimes. The typical frequency of interruption for Spot Instances in the last 30 days was less than 5% on average.

To reduce the impact of interruptions and optimize Spot Instances, diversify and run your application across multiple capacity pools. Each instance family, each instance size, in each Availability Zone, in every Region is a separate Spot pool. You can use the RequestSpotFleet API operation to launch thousands of Spot Instances and diversify resources automatically. To further reduce the impact of interruptions, you can also set up Spot Instances and Spot Fleets to respond to an interruption notice by stopping or hibernating rather than terminating instances when capacity is no longer available.

Spot Instances are now available in 18 Regions and 51 Availability Zones, and offer 100s of instance options. We have eliminated bidding, simplified the pricing model, and have made it easy to get started with Amazon EC2 Spot Instances for you to take advantage of the largest pool of cost-effective compute capacity in the world. See the Spot Instances detail page for more information and create your Spot Instance here.