AWS

Decoding the Cloud: AWS EDP vs Savings Plan

The difference between AWS Savings Plan and EDP (Enterprise Discount Program):

  • Pricing Model: AWS Savings Plan offers discounted rates for specific usage commitment, while EDP provides broader discounts across AWS services based on overall spend commitment.
  • Flexibility: The Savings Plan is more flexible, allowing changes in service usage, whereas EDP discounts are generally tied to overall spending levels.
  • Commitment: A Savings Plan requires a commitment to a certain usage amount, while an EDP involves a financial commitment over a set period.

AWS EDP vs. Savings Plan

AWS EDP vs. Savings Plan

What is the AWS Savings Plan

AWS Savings Plan is a pricing model offered by Amazon Web Services (AWS) that allows customers to save money on their AWS compute usage.

This plan is characterized by:

  • Usage Commitment: Customers commit to a specific amount of compute power usage (measured per hour) for either a one-year or three-year period.
  • Flexible Services: It applies to various AWS services, including Amazon EC2, AWS Fargate, AWS Lambda, and Amazon SageMaker.
  • Cost Savings: Offers up to 72% savings compared to On-Demand rates.
  • Variety of Plans: Includes Compute Savings Plans, EC2 Instance Savings Plans, and Amazon SageMaker Savings Plans.
  • Payment Options: Customers can choose from all upfront, partial upfront, or no upfront payment options.

What is AWS EDP

AWS Enterprise Discount Program (EDP) is a discount program for large-scale AWS customers. It involves:

  • Financial Commitment: Customers commit to spending a specific dollar amount over a fixed period, typically one to three years.
  • Broad Discounts: Provides discounts across a wide range of AWS services, not limited to compute services.
  • Custom Agreement: The terms and discounts are negotiated based on the customer’s projected AWS usage.
  • Enterprise-Focused: Tailored for large organizations with substantial AWS spend.

Pros and Cons of the AWS Savings Plan

Pros and Cons of the AWS Savings Plan

Pros:

  • Significant Cost Savings: Substantial savings over On-Demand pricing.
  • Flexibility in Service Usage: Allows shifting usage across different AWS services.
  • No Upfront Cost Option: Offers flexibility in payment options, including no upfront payment.

Cons:

  • Long-Term Commitment: Requires commitment to a certain usage level for one or three years.
  • Complexity in Management: Managing and optimizing plans can be complex.

Pros and Cons of AWS EDP

Pros and Cons of AWS EDP

Pros:

  • Broad Range of Discounts: Discounts apply to a wide range of AWS services.
  • Customizable Agreements: Terms and discounts are tailored to the customer’s needs.
  • Suitable for Large Enterprises: Ideal for organizations with large-scale cloud operations.

Cons:

  • Minimum Spend Requirement: Requires a significant financial commitment over a set period.
  • Less Flexibility in Service Usage: Discounts are tied to overall spending rather than specific service usage.
  • Complex Negotiation Process: Terms and discounts require negotiation and an understanding of projected usage.

Each agreement type, AWS Savings Plan, and AWS EDP offer unique advantages and challenges, making them suitable for different AWS customers based on their specific needs and usage patterns.

FAQ on AWS EDP to Savings Plan

Can I switch from AWS EDP to Savings Plan?

 Yes, you can switch from AWS EDP to a Savings Plan. However, remember that you’ll still need to fulfill your EDP commitment.

Can I use both AWS EDP and Savings Plan?

Yes, you can use both AWS EDP and Savings Plan. They can complement each other, providing maximum savings.

Which is cheaper: AWS EDP or Savings Plan?

It depends on your usage. AWS EDP can be cheaper for larger businesses with predictable use, while Savings Plan can be cheaper for companies with fluctuating usage.

Can I change my AWS Savings Plan commitment?

Yes, you can change your AWS Savings Plan commitment. However, remember that the changes will only apply to future usage.

Does AWS EDP cover all AWS services?

Yes, AWS EDP covers all AWS services.

Conclusion: Choosing Between AWS Savings Plan and AWS EDP

Whether to opt for an AWS Savings Plan or an AWS Enterprise Discount Program (EDP) depends on an organization’s specific needs, scale, and usage patterns.

Who Should Consider an AWS Savings Plan?

  • Businesses Seeking Flexibility: Organizations requiring flexibility in cloud service usage and wanting to shift usage across different AWS services should consider AWS Savings Plans.
  • Cost-Conscious Customers: Companies looking for significant cost savings compared to On-Demand pricing without a substantial upfront financial commitment.
  • Diverse Usage Requirements: Organizations with varying compute needs, including those using Amazon EC2, AWS Fargate, or AWS Lambda, can benefit from the versatile savings options of AWS Savings Plans.

Who Should Consider an AWS EDP?

  • Large Enterprises with High Cloud Spend: AWS EDP is ideal for large-scale enterprises with high AWS spending and can commit to a significant budget over a fixed period.
  • Organizations Seeking Custom Agreements: Businesses that prefer tailor-made agreements and are capable of negotiating terms that align with their projected cloud usage.
  • Companies with Broad AWS Service Usage: Enterprises that utilize a wide range of AWS services and are looking for discounts across these services rather than specific compute usage savings.

AWS Savings Plans are generally more suitable for organizations seeking flexibility and specific compute savings.

At the same time, AWS EDPs are more aligned with the needs of large enterprises that require broader, customizable discounts across a range of AWS services.

Understanding the unique aspects of each option is crucial for organizations to make an informed decision that aligns with their cloud strategy and financial objectives.

Author

  • Fredrik Filipsson

    Fredrik Filipsson brings two decades of Oracle license management experience, including a nine-year tenure at Oracle and 11 years in Oracle license consulting. His expertise extends across leading IT corporations like IBM, enriching his profile with a broad spectrum of software and cloud projects. Filipsson's proficiency encompasses IBM, SAP, Microsoft, and Salesforce platforms, alongside significant involvement in Microsoft Copilot and AI initiatives, enhancing organizational efficiency.

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