AWS Enterprise Discount Program – Enterprise IT Advisory

AWS Enterprise Discount Program

The AWS Enterprise Discount Program (EDP) is a private pricing agreement for high-spending AWS customers, offering significant savings in exchange for a committed annual spend.

It can deliver meaningful cost reductions for enterprises that plan cloud usage well, but it also introduces contractual obligations and financial risks if not managed carefully.

CIOs, CTOs, and CFOs should understand the benefits, requirements, and negotiation tactics of AWS EDP to maximize value and avoid common pitfalls.

Read Strategic Toolkit: Managing AWS Contracts – 20 Key Considerations for Procurement.

Understanding the AWS Enterprise Discount Program

The AWS Enterprise Discount Program (EDP) – also known internally as a Private Pricing Agreement (PPA) – is essentially AWS’s volume discount plan for large enterprises.

In an EDP, your organization commits to spending a certain amount (e.g., $X million per year) on AWS over a term (typically 1–3 years, up to 5 years) in return for a global discount on virtually all AWS services.

The discount percentage is negotiated based on your spend level and contract length – the more you commit and the longer the term, the bigger the discount. For example, a minimal commitment of around $1M/year might yield only a single-digit discount (~5–6%), while very large commitments (tens of millions annually) can secure double-digit percentage savings (in the high teens or more).

The EDP discount is applied across your AWS bill (covering most services and regions uniformly), simplifying cost management compared to juggling service-specific deals. Essentially, AWS EDP rewards long-term, high-volume cloud consumption with predictable savings and a closer partnership with AWS.

How it works: Once enrolled, you pay your AWS invoices at the discounted rates. If you exceed your committed spend, you still get the discount on the overage (so you’re not penalized for growth, aside from paying more in absolute terms).

However, any excess spend in one year won’t count toward the next year’s commitment – each period’s commitment stands alone. If you undershoot your commitment, you must still pay the committed minimum (or true-up the shortfall at year-end), and unused commitment doesn’t roll over.

In effect, an EDP transforms part of your cloud spend into a fixed cost – you agree to pay AWS at least $X per year whether you use it or not.

This structure makes it critical to forecast accurately and commit to an amount you’re confident you can use.

AWS EDPs are usually all-encompassing (aggregating spend across all linked accounts, regions, and AWS services) so you can apply the discount to your entire enterprise usage.

Benefits of AWS EDP for Enterprises

Entering an AWS Enterprise Discount Program can offer several advantages for large organizations:

• Significant Cost Savings: The primary benefit is lower AWS pricing across the board. Enterprises with large, steady workloads can save millions over time via an EDP’s discounted rates. Savings are especially impactful if your cloud spend is already high and growing. The EDP discount applies to almost all AWS services (compute, storage, data transfer, etc.), providing a consistent percentage off the standard on-demand prices. This is simpler and often more far-reaching than relying on ad-hoc discounts or using spot instances or reserved instances solely.
• Predictability and Budgeting: By locking in committed spend and discounts, CIOs and CFOs gain more predictable cloud costs year over year. The EDP effectively fixes your minimum AWS spend, which can simplify budgeting and provide cost certainty to finance teams. It also cements a partnership with AWS – you know your pricing terms for the duration, and AWS knows your business is committed, which can yield intangible benefits, such as better account support and investment from AWS in your success.
• Flexible Discount Coverage: Unlike individual service discounts or one-off credits, an EDP’s percentage discount blankets a wide range of AWS services and regions. This flexibility means you don’t have to negotiate separate deals for each service or project; as your teams innovate and use new AWS offerings, those are typically covered under the same discount umbrella (as long as they are standard AWS services). It’s a holistic saving mechanism across your entire AWS footprint, allowing technology leaders to pursue new cloud initiatives with the confidence that they’re still getting the enterprise rate.
• Competitive Advantage & Scalability: For organizations planning to scale on AWS, an EDP can leverage cloud economics to create a competitive advantage. The larger your environment grows, the more absolute dollars you save through the discounted rate, allowing you to reinvest the savings elsewhere. Also, being an EDP customer often means priority attention from AWS (such as dedicated account managers, architecture support, or access to beta programs), which can help your teams innovate faster. In industries with tight margins, the cost reduction from an EDP can improve profitability or pricing flexibility for your end products.
• Simplified Cloud Cost Management: With a single EDP agreement, enterprises consolidate their cloud spend strategy. It complements other cost optimization efforts (like reserved instances and savings plans) by ensuring any usage beyond those optimizations still gets a blanket discount. Many CIOs appreciate that an EDP can reduce reliance on continually purchasing new RIs/Savings Plans for every workload – you still use those tools. Still, the EDP guarantees a baseline discount on all spend, including unpredictable or on-demand usage spikes.

Risks and Drawbacks to Consider

Despite the clear benefits, AWS EDPs come with important caveats and risks that technology and finance leaders must weigh:

• Commitment Risk (Paying for Unused Spend): The biggest risk is overcommitting your spend. If you estimate high your AWS usage and commit to more than you actually consume, you will pay for the unused portion at the end of the term without any benefit. This can erode all the savings the discount provides. For example, committing $10M/year and only using $8M means that $2M is essentially wasted – the discount on the $8M used won’t compensate for the $2M paid for nothing. There is no rollover for unused commitment, so any shortfall each year (or at the end of the contract) is a direct cost. This puts pressure on organizations to forecast cloud usage with high accuracy and perhaps leave a safety margin. Rapid changes – like a sudden efficiency improvement, project cancellation, or economic downturn – could leave you below commitment and owing money for capacity you didn’t use.
• Vendor Lock-In and Less Flexibility: An EDP deepens your lock-in to AWS. Of course, you can technically still use other clouds or on-prem resources, but financially, you’re incentivized to keep as much as possible on AWS to meet your commitment. This might limit multi-cloud or cloud exit strategies, because moving workload off AWS means you’d still pay AWS for the committed amount and pay another provider. Additionally, AWS often expects an EDP customer’s spend to grow annually (often by 15–20% or more). They may structure deals with increasing yearly minimums. This reduces flexibility if your strategy changes – you’re locked into not just using AWS, but potentially using more of it each year. If your business wants to pivot or trim costs, the EDP can become a constraint. In short, you gain savings at the cost of some agility in adjusting your AWS usage up or down as needed.
• Mandatory Enterprise Support (Added Cost): AWS requires EDP customers to subscribe to Enterprise Support, the top-tier support plan, for the duration of the contract. Enterprise Support costs roughly 3–10% of your AWS spend (scaling down percentage-wise at very high spend levels). For large bills, this support fee is substantial – potentially hundreds of thousands or millions of dollars annually. This is essentially an extra “cloud tax” that partially offsets the EDP discount. For example, you might get a 10% EDP discount but owe 7% in support fees, netting only 3% effective savings if you wouldn’t otherwise pay for that level of support. Enterprise Support does provide value (technical account managers, faster support responses, etc.), but some enterprises might not need all of it. Regardless, it’s non-optional with EDP. CFOs should factor the support fees into the true cost/benefit analysis of an EDP. The savvy approach is to negotiate those support costs (see later sections) so they don’t eat the entire discount.
• Complex Forecasting and Management Overhead: Joining an AWS EDP means you must actively manage your cloud consumption to meet but not wildly exceed your commitment. This can introduce management overhead, as teams will need to monitor spend progress, potentially coordinate the timing of new projects to align with commitment targets, and continually optimize costs. Paradoxically, some companies find that after signing an EDP, they must implement cost-cutting measures – e.g., aggressively rightsizing or shutting down workloads – because they don’t want to drop below the commitment. This can be at odds with normal cost optimization initiatives. Essentially, you’re committing to spend a significant amount, which can reduce the usual incentive to save (since you’ll pay AWS anyway, up to the commitment). If not handled carefully, this mindset could lead to complacency or inefficient cloud use. It requires a disciplined approach: optimize costs as you normally would, but size the commit appropriately so those optimizations don’t cause under-spend.
• Contractual Complexity and Renewal Cliff: AWS EDP contracts can be intricate, and if you don’t negotiate carefully, you might agree to terms that bite later. For instance, if the contract auto-renews or has stringent renewal terms, you may end up being locked in for longer than intended or lose leverage during renegotiation. More commonly, when an EDP expires, all discounts disappear immediately if no new deal is in place, which could spike your cloud costs by 20–30% overnight. This is a risk if procurement teams forget to renegotiate in time. Additionally, certain usage might be excluded or limited (e.g., Marketplace spend counts only partially). All these fine-print issues mean an EDP requires careful contract review and active renewal planning to avoid surprises. We’ll discuss specific pitfalls and how to mitigate them later.

Evaluating If AWS EDP Is Right for You (Eligibility & Readiness)

Not every organization will benefit from an AWS Enterprise Discount Program. It’s critical to evaluate whether you qualify and whether an EDP aligns with your cloud strategy.

Key considerations include:

• Spending Threshold: Generally, AWS targets the EDP at customers spending $1 million or more per year on AWS. That’s the ballpark starting point to even discuss an enterprise discount. In some regions or cases, it might kick in slightly lower, but as a rule of thumb, if your annual AWS spend isn’t near seven figures, an EDP likely isn’t on the table. On the other hand, if you’re spending multiple millions of dollars annually (or plan to soon), you should be discussing enterprise pricing with AWS. Ensure you have a clear understanding of your current AWS spend across all accounts and what it will be in the future. If you’re below the threshold, you might focus on other savings programs for now (like Savings Plans, Reserved Instances, etc.) and revisit EDP when you scale up.
• Forecasting Confidence: Can you predict your AWS usage 1–3 years out with confidence? This is a fundamental question before entering an EDP. Due to the commitment requirement, you require a high degree of certainty regarding your future cloud needs. Engage both the engineering and finance teams to forecast growth, new projects, and potential changes (e.g., migrations, architectural changes) that will impact spending. Consider both historical trends and business roadmaps. If your usage is volatile or you lack visibility into what drives your cloud costs, you may not be ready for a large commitment. Best practice is to forecast a range (best case, worst case) and only commit to something near the low end or midpoint of that range to stay safe. Organizations that have mature cloud cost management and reporting (e.g., showback/chargeback models, granular budgets by team) will find it much easier to manage an EDP.
• Current Cost Optimization Level: Before locking in an EDP, ensure your current AWS spend is reasonably optimized. If you have a lot of wastage (idle resources, oversized instances, etc.), that inflated spend could lead to overcommitment. It’s wise to implement cost optimizations before you sign the dotted line. Audit your environment for savings opportunities: right-size your infrastructure, eliminate unused assets, consider existing discounts (RIs/Savings Plans), and optimize inefficient usage. By trimming the fat, you’ll arrive at a leaner baseline to commit against. This avoids the scenario of committing based on an inefficient environment and then failing to meet that commitment once you clean things up. In short, tune up your AWS house, then enter the agreement based on the lean run rate. Additionally, ensure that you’ll use the AWS services you’re paying for – if you plan to shift some workload off AWS or retire an application, factor that into any commitment.
• Strategic Fit and Growth Plans: Consider your broader IT strategy. Are you “all-in” on AWS for the foreseeable future, or pursuing multi-cloud/hybrid approaches? An EDP makes the most sense when AWS is (and will remain) your primary platform and you foresee growth in AWS usage. If your company strategy is to diversify cloud vendors or if there’s uncertainty in product direction, committing heavily to AWS may conflict with those plans. Also, check if there are upcoming opportunities for AWS usage expansion, such as a data center migration, a new product launch, or geographical expansion. If so, those can bolster your case to join EDP (and negotiate a better rate due to expected growth). Conversely, if you anticipate flat or declining AWS usage (perhaps due to optimization or moving some services in-house), be cautious about signing a multi-year commitment that assumes growth.
• Executive and Stakeholder Buy-In: Gaining the benefits of an EDP requires alignment between engineering, finance, and leadership. CFOs need to be comfortable with the idea of a multi-year liability (it will likely need to be accounted for similarly to a purchase commitment). Engineering and product teams need to commit to using AWS to a sufficient degree. And AWS will often want a clear executive sponsor involved (like a CIO) when making a big discount deal. Before entering negotiations, ensure that all stakeholders understand the implications – for example, finance is aware of the support costs and commitment liability, IT is aware of the need to adhere to AWS, and procurement/legal are prepared to review the contract terms. If internal consensus is shaky, it’s better to resolve that first than to sign an EDP and face internal pushback later.

In short, an AWS EDP can be a smart move only if (a) your spend level justifies it, (b) you can reliably project usage and meet the commitment, and (c) it aligns with your technology direction.

If these boxes are checked, you’re likely a good candidate to pursue an enterprise discount with AWS. Next, we’ll cover how to negotiate the best deal once you decide to move forward.

Negotiating Your AWS EDP: Strategies for Success

AWS is often willing to give substantial discounts to enterprise customers – but you won’t get the best terms unless you negotiate assertively. Approaching an AWS EDP negotiation like a pro can save millions.

Here are key strategies and tactics:

• Aim High for the Discount: Don’t hesitate to ask for a substantial discount upfront, especially if you have a significant annual spend. AWS’s initial offer might be conservative. Enterprise customers spending $7,000 or more annually commonly achieve double-digit percentage discounts, but you may need to negotiate for it. Start negotiations by proposing an aggressive discount target (for example, 15–20% off list prices) and let AWS counter from there. If you’re a very large spender (hundreds of millions over the term), asking for 25%+ isn’t unreasonable. The key is to anchor high – AWS sales reps won’t initially volunteer their best price, so position yourself to negotiate down from a customer-favorable starting point. Cite any internal cost mandates or competitive offers to justify why you need a better rate (e.g., “Our CFO demands we cut cloud unit costs by 15% next year”). Remember, the difference between a 5% and 15% discount at scale is enormous for your bottom line, so every point you negotiate is worth the effort.
• Leverage Competing Options: One of the strongest cards you can play is the threat of moving workloads to Azure, GCP, or others. Even if you have no immediate plans to shift, do your homework – obtain a rough proposal or pricing estimate from another cloud, or simply let AWS know you’re evaluating alternatives. Cloud providers hate to lose big customers, so AWS will be motivated to sweeten the deal if it senses real competition. In negotiations, you don’t need to issue ultimatums; a subtle approach works: mention that you are also talking to Microsoft and Google, or that your board is interested in a multi-cloud strategy to control costs. If AWS believes there’s a credible risk of you migrating (even partially), they are far more likely to concede on price or contract terms. Use this competitive pressure to your advantage – for example, “Azure offered us committed spend discounts and some free migration support; we’d prefer to stay with AWS, but the economics have to match.” Even hints like that can shift the tone of the negotiation in your favor.
• Show You Can Self-Optimize: Make it clear to AWS that if they don’t come through with a good discount, you have other ways to save on AWS on your own. Specifically, highlight your ability to leverage Reserved Instances, Savings Plans, and Spot Instances to reduce costs without requiring a special contract. This does two things: (1) it provides a credible fallback – “If the EDP discount isn’t compelling, we’ll just optimize usage and buy RIs/SPs aggressively instead,” – and (2) it educates AWS that you won’t pay full on-demand price regardless, so they need to beat the savings you can achieve independently. For instance, note that you’re prepared to reserve capacity for your stable workloads (which can cut costs 30–70%) or use spot instances for flexible jobs. Essentially, politely remind AWS that you have the tools to minimize on-demand spend; the EDP should add value beyond what you can already do. This posture strengthens your hand: AWS knows if they don’t offer enough, you’ll optimize, and their revenue might drop anyway. Often, this approach leads AWS to improve the EDP terms, preventing you from incurring excessive RIs or considering other clouds.
• Identify Your Top Cost Drivers: In any large AWS environment, typically a few services (like EC2, S3, RDS, data transfer, etc.) account for the bulk of costs. As part of your negotiation prep, identify the top 2–3 “big-ticket” services for your organization. Negotiate specific discounts or credits for those services in addition to the blanket EDP discount. AWS offers flexibility to provide service-specific deals (often referred to as Private Pricing for a particular service) when your usage is substantial. For example, if you spend millions on storage or outbound data transfer, you could negotiate an additional percentage off or a custom rate for those charges. In one real case, an enterprise layered a special agreement to receive ~30% off their EC2 and S3 usage, on top of a roughly 20% overall EDP discount – significantly increasing their savings. AWS won’t volunteer these extras, but if you ask and justify (“EC2 is 60% of our cost – it’s where we most need relief”), they may be willing to accommodate to win or retain your business. Think of it like negotiating a lease: you bargain for the base rent (overall discount) and also try to get free parking and utilities (specific service breaks).
• Optimize Commitment Levels: The structure of your committed spend is negotiable – don’t just accept AWS’s suggested numbers blindly. One insider tip: consider committing to slightly less than your expected usage to give yourself breathing room. It’s often wiser to under-commit and occasionally exceed it (paying the discounted rate on the overage) than to over-commit and risk unused spend. A practical guideline some use is committing to no more than ~50–70% of your projected spend; the rest acts as a buffer in case growth doesn’t materialize. Also, pay attention to tier thresholds: AWS EDP discounts typically jump at higher spend tiers. If you’re near a tier (say, committing $9M vs. $10M might increase the discount from 12% to 15%), evaluate whether raising the commitment slightly is worth the larger discount. Sometimes adding a bit more commitment can pay for itself via a higher discount rate – but do this only if you’re confident you’ll use it. Conversely, if AWS demands a huge commitment increase for only a marginally better discount, push back. Model the ROI of any commitment increase in negotiation to see if the math works in your favor.
• Negotiate Contract Length and Flexibility: AWS will often push for a longer term (they may offer a bigger discount on a 3- or 5-year deal), but be cautious about long commitments. The cloud landscape and your business can change quickly. If possible, keep the term to 3 years or less – this allows you to renegotiate sooner and not be stuck with yesterday’s pricing. If you do consider a longer deal (4-5 years), insist on re-evaluation clauses (e.g., an opportunity to adjust terms after 2 years) or at least the ability to renegotiate if you drastically outgrow or under-run the commitment. Another strategy is the “blend and extend” – for example, if you’re mid-term and usage is off, you might extend the contract in exchange for adjusting the commitment or getting a fresh discount. Case in point: one high-profile AWS customer negotiated an extension to their contract when their usage growth slowed, rather than paying a shortfall – essentially rescheduling their commitment over a longer period. Everything is negotiable if you’re a large customer, so don’t hesitate to propose creative structures (such as a 2-year contract with a mutual option to extend or an out-clause if a certain business event occurs). At a minimum, avoid any clause that automatically increases your commitment annually without a chance to revisit it.
• Consider Prepayment or Upfront Fees: Historically, AWS has sometimes required upfront payment for EDPs, but it is now more flexible. Still, you can offer a partial prepay of your committed spend to secure a better discount. If your company has cash on hand and the CFO is amenable, prepaying a portion (or committing to a certain spend in the first year upfront) might give AWS more incentive to deal. Prepayments improve AWS’s cash flow, allowing it to reciprocate with an extra percentage point or two off. This isn’t necessary for all, but it’s a lever to keep in mind. Ensure that any prepayment you make is worth the improved terms and that it doesn’t significantly impact your cash position.
• Lock In Support and Other Value-Adds: As mentioned, Enterprise Support fees can eat into savings. During negotiations, explicitly address support costs by asking AWS for a reduced support fee percentage or a cap on annual support costs. For instance, if your spend might double over the term, try to cap support at a fixed dollar amount or current percentage, so it doesn’t balloon. AWS may be willing to include that concession if pressed. Additionally, consider requesting additional benefits in the deal, such as training credits for your staff, AWS professional services hours to assist with migrations, or funding from programs like the Migration Acceleration Program (MAP) if you plan to migrate significant workloads from on-premises. Sometimes AWS can bundle in funding for specific projects or co-marketing opportunities as part of the enterprise agreement. These extras can provide value beyond just the discount and help justify the commitment internally.

In summary, negotiating an AWS EDP is about maximizing your leverage: your existing spend, your potential growth, the competitive alternatives, and your ability to optimize on your own.

Enter discussions with a clear strategy, data to support your requests (spend forecasts, comparative pricing, etc.), and a willingness to advocate for what your enterprise needs.

AWS representatives expect tough negotiations with large customers – acting like a savvy buyer will earn their respect and usually result in a better deal.

Key Contract Considerations and Pitfalls

Signing the EDP contract isn’t the end – you must ensure the contract terms themselves protect your interests. Many clauses can significantly impact the value of the deal.

Below are critical EDP contract pitfalls to watch out for and ways to mitigate them:

In addition to the above, carefully review clauses around exit rights, assignments, and confidentiality.

For example, ensure there’s no onerous penalty if you choose not to renew (aside from losing the discount), and that you can discuss basic details internally (you may be under NDA not to disclose specific terms publicly, which is standard).

Also, double-check how things like AWS credit programs or promotions interact with your EDP – sometimes AWS provides service credits or incentives separate from EDP; be aware of whether using those affects your committed spend accounting.

It’s wise to have your procurement and legal teams do a thorough redline of the contract, just as you would with other major vendor agreements.

The bottom line is to protect your downside: structure the contract so that if your situation changes or AWS’s pricing changes, you have options.

A well-negotiated EDP contract will lock in savings without locking you into painful terms.

Recommendations (Practical Tips)

Finally, here are expert tips and best practices to ensure you get the most value from AWS’s Enterprise Discount Program:

• Forecast First, Commit Second: Do not enter an EDP without a solid grasp of your future AWS usage. Invest time in forecasting and get a broad consensus on a conservative commit number. It’s better to slightly under-commit than over-commit.
• Optimize Your Cloud Costs Pre-EDP: Clean up wasteful spending (idle resources, over-provisioning) before locking in a contract. This ensures your commitment is based on efficient usage and prevents shortfalls if you later trim fat.
• Negotiate Beyond the Percentage: Don’t focus only on “X% discount.” Negotiate all facets – support costs, specific service discounts, contract flexibility, and any available AWS funding programs. A slightly lower discount with more flexibility and credits can be far more valuable than a higher discount on a rigid contract.
• Leverage Competition and Alternatives: Even if you’re committed to AWS, use the existence of Azure, GCP, or on-prem alternatives as leverage. Get quotes or at least be ready to discuss how other providers could fill your needs. AWS will often improve terms if it believes you have viable options.
• Consolidate and Collaborate: Treat your AWS spend as a single, unified pool when negotiating. Combine the spending of all departments, business units, and even subsidiaries, if possible, to reach higher discount tiers. Internally, work across teams (IT, finance, and DevOps) to present a unified request to AWS and manage the commitment once it is in place.
• Monitor and Adjust Continuously: Once on an EDP, treat it as a living part of your IT strategy. Monitor usage monthly against the commit; if you’re trending above or below, adjust plans accordingly (e.g., speed up projects if you’re undercommitted, or optimize more if you’re way over to save money). Engage AWS early if things change – for large customers, they may adapt the deal (e.g., Airbnb’s extension during COVID) rather than lose you or see you struggle.
• Start Renewal Talks Early: Don’t wait until the last minute to renew or renegotiate. Start discussions well before the term ends. Use that time to evaluate how the current EDP served you – were the discounts sufficient, did you meet your commitments easily, etc. – and use those insights to shape the next deal. A proactive approach avoids lapses in discounts or rushed, less favorable renewals.
• Consider Third-Party Advisors: If navigating these negotiations feels daunting, consider engaging a cloud cost consulting firm or a software platform (utilizing tools and experts specializing in AWS contract optimization). They can bring benchmarks and negotiation experience to help you secure a superior outcome – often paying for themselves via the savings gained.
• Align EDP with Business Goals: Ensure the EDP supports your broader objectives. For instance, if you plan a major expansion, negotiate for AWS support in those plans (like training or architectural guidance as part of the deal). If cost reduction is a top goal for the CFO, ensure the EDP is structured to genuinely reduce unit costs (after all fees). In short, the EDP should be a tool to further your strategy, not an end in itself.

By following these recommendations, enterprises can confidently pursue an AWS Enterprise Discount Program and turn it into a win-win: immediate cost savings and a cloud partnership that enables growth, all while minimizing risk and maintaining flexibility.

Checklist: 5 Actions to Take

For leaders ready to engage with AWS on an Enterprise Discount Program, here’s a simple step-by-step checklist to get started:

1. Assess Your Cloud Spend and Usage Patterns: Gather the data on your current AWS bills (annual run-rate, top services, growth trend). Ensure you meet the threshold of over $ 1 M and analyze how your usage might change in the next 1-3 years.
2. Optimize and Baseline Your Costs: Before talks with AWS, implement quick cost optimizations (cleanup, rightsizing, existing Savings Plans/RIs). Establish a “clean” baseline spend so you know what truly needs to be committed.
3. Internally Align on Goals and Limits: Meet with finance, IT, and executives to agree on your negotiation stance – e.g., the maximum commitment you’re comfortable with, the minimum discount or terms you need, and any deal-breakers (like no multi-year ramp beyond X%). Get buy-in that the organization will support the committed AWS usage.
4. Engage AWS (and Do Competitive Homework): Reach out to your AWS account manager, indicating you’re interested in an enterprise agreement. Simultaneously, quietly benchmark alternatives: pricing from Azure/GCP, or how much you’d save with just RIs/SPs if no EDP. Use this homework to inform your asks. Then, enter formal negotiations with AWS, armed with data and a clear request for a discount percentage, term, and conditions.
5. Review and Secure the Contract: When AWS presents a deal, review the contract meticulously. Use the checklist of pitfalls above – check commitment terms, support fee clauses, any exclusions, and renewal language. Redline any problematic terms and negotiate fixes. Involve legal/procurement to finalize a contract that meets your needs. Only sign when you’re confident the numbers and terms align with your strategy.

Following this checklist will help ensure you don’t rush into an AWS EDP unprepared. Each step builds the foundation for a successful negotiation and a well-structured agreement.

FAQs

Q1: What spend level do we need to qualify for the AWS Enterprise Discount Program?
A: While there’s no hard public rule, in practice, AWS’s Enterprise Discount Program is targeted at customers spending around $1 million or more per year on AWS. That’s the typical entry point. If you’re well below that, AWS might not offer an EDP. As your spend grows into the high six or seven figures annually, AWS will proactively suggest a committed discount program. The larger your spend (multi-millions and up), the more compelling the discounts AWS is willing to consider. Always discuss with your AWS account team — even if you’re nearing the threshold, they can advise on timing or interim programs until you qualify.

Q2: How much discount can we get with an AWS EDP?
A: The discount percentage is negotiated and varies based on your commitment size and term. Smaller commits (around $1M/year) might only receive single-digit percentage discounts off standard pricing. For example, discounts of 5–10% are common at the low end. As commitments rise into the tens of millions, double-digit discounts become standard (e.g., 15–20% off, sometimes more for extremely large deals). The length of contract also factors in – a 3-year term might yield a higher discount than a 1-year term, since AWS values the longer commitment. Additionally, you could negotiate extra discounts on specific high-cost services (e.g., an additional break on EC2 or data transfer). In sum, there’s no fixed EDP rate – it’s all about your leverage. Enterprises should aim for the teens or higher if their spend justifies it, and use competitive pressure to secure the best offer from AWS.

Q3: Does the EDP discount stack with other AWS savings like Reserved Instances or Savings Plans?
A: Yes, in general, the EDP discount applies on top of your net AWS spend, which already factors in any Reserved Instance (RI) or Savings Plan savings. Concretely, if you have an RI that gives you 50% off an instance, you pay that reduced rate, and then your EDP might give an additional X% off that rate. (In some cases, the EDP might function as a retroactive rebate or credit, but the effect is the same: you realize the EDP savings in addition to RI/SP discounts.) That said, using RIs or Savings Plans also reduces the amount of on-demand spend you have, which can make it easier to meet your commitments since you’ve lowered costs. It’s essential to note that RI and SP purchases themselves contribute to your spend commitment. So, if you purchase a $ 100,000 Savings Plan, that $ 100,000 is part of your committed spend fulfillment. The key takeaway is you should continue using RIs, SPs, and other optimizations under an EDP – the program is designed to encompass all your usage. The EDP discount essentially sweetens whatever your bill is after all other discounts have been applied. Be mindful to plan your commitment, knowing you will be leveraging other savings programs.

Q4: What happens if we don’t meet our annual committed spend under the EDP?
A: If you undershoot your commitment, AWS will still bill you for the full committed amount. Typically, at year-end (or the end of your contract term), there’s a “true-up” process: you will pay the difference between what you spent and what you committed. For instance, if you committed to $5 million but only used $4.5 million in services, AWS will charge you the remaining $500k to satisfy the contract. Essentially, you lose that money with no corresponding service usage – it’s the cost of overcommitting. There are no rollovers or carry-forward of unused commitments to the next year; each year or term stands alone. This is why accurate forecasting is crucial. In some extraordinary cases (like a once-in-a-lifetime business downturn), you could try to renegotiate or extend the term to absorb the shortfall, but that’s at AWS’s discretion and not guaranteed by contract. The contract will obligate you to pay the committed amount regardless. Always err on the side of a realistic commit you’re confident to hit, since the penalty for guessing wrong is effectively wasted budget.

Q5: Is AWS Enterprise Support truly mandatory for EDP customers, and can we negotiate this requirement?
A: Yes, Enterprise Support is a required part of the EDP agreement in almost all cases. AWS makes top-tier support a condition likely because they want EDP customers to have a high level of service (and also, frankly, because it generates additional revenue). If you’re not already on Enterprise Support, be prepared to upgrade as part of the deal. However, while you can’t opt out of it, you can negotiate aspects of the support cost. For large commitments, everything is on the table – we’ve seen companies negotiate a reduced support percentage or a cap, so that if their usage grows, they don’t continue to pay more and more for support. For example, if Enterprise Support accounts for 7% of your spend, you might negotiate it down to 5%, or cap it at a certain annual dollar amount. You should also evaluate the value that Enterprise Support brings, including 24/7 tech support, a dedicated Technical Account Manager (TAM), and faster response SLAs, which can be particularly helpful in an enterprise-scale environment. Ensure you’re utilizing those benefits (open support cases, use your TAM for architecture reviews, etc.) to get your money’s worth. And if you feel support fees are disproportionate, absolutely raise it in negotiation – AWS may not volunteer a concession on support. Still, if you make it a sticking point, they often will bend to keep the overall deal attractive.

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