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AWS Spot Instance pricing depends on the kind of Spot Instance and unique usage requirements. For an On-Demand model, discounts go up to 89 percent off. Reserved Instances, on the other hand, have discounts rooted in a commitment. Users commit to paying a given price for their Spot Instance usage. Because of the dynamic nature of the cloud, Spot Instance pricing varies based on demand, usage patterns, and time.
We notice the price of a Spot Instance on a Monday isn’t the same as the price on a Sunday from price history charts. However, cloud users can utilize the average spot price when making both short-term and long-term decisions.
AWS Reserved Instances vs. On-Demand
There are two types of Spot Instances: Reserved Instances and On-Demand Instances. Even though Reserved Instances are ideal for future use, you use On-Demand Instances on an ongoing basis.
It’s equally important to note that both Spot Instances have the same compute power, with price being the only varying factor.
Here are two pricing examples:
- Reserved Instance pricing. If you choose to pay upfront for a one-year term, AWS will give you a discount. Paying upfront is cheaper than the equivalent one-year term for On-Demand billing.
- On-Demand Pricing. On-Demand pricing bills on an hourly basis. Unlike Reserved Instances, users don’t calculate the number of instances they need. AWS will automatically assign the quantity based on existing market circumstances.
How the Pricing Works
Spot pricing is driven by AWS’ real-time capacity availability, not by an open auction like it once was. Today, Spot prices fluctuate based on supply and demand for unused EC2 capacity in each instance family, size, and Availability Zone. When AWS has excess capacity, Spot prices fall. When capacity tightens — for example, due to growing demand from On-Demand or Reserved Instances in that AZ — prices may increase or instances may be reclaimed.
Factors Affecting Spot Instance Prices
Several factors influence how stable or volatile Spot pricing will be for a given instance type:
Regional capacity trends. Certain instance families may see more stable pricing in regions where AWS has excess hardware inventory or lower overall demand for that compute class.
Instance family and size. Popular instance families (e.g. C7, M7, R7) may experience more dynamic price changes if demand fluctuates quickly. Less popular or older families sometimes offer more stable pricing if fewer customers are actively using them.
Time of day or seasonal trends. Large batch jobs, training workloads, or major product launches can cause short-term shifts in capacity demand that impact Spot availability and pricing.
New hardware rollouts. As AWS introduces new generations of instance types, capacity shifts may create temporarily lower Spot prices on newer families while older families may tighten.
Capacity pools. Spot pricing operates within individual capacity pools — a combination of instance type, size, AZ, and networking option. The pricing for one pool is independent of others, even within the same region.
While Spot prices still fluctuate, AWS actively manages pricing algorithms to avoid sharp spikes and provide relatively stable pricing signals for most production workloads. The bigger risk today is not pricing volatility — it’s sudden interruptions if capacity becomes unavailable.
nOps makes Spot easy
nOps automates the full process of running on Spot. It intelligently provisions all your compute automatically so you get the best pricing available without sacrificing any reliability. And with awareness of all your commitments, it ensures you’re on the most reliable and cost effective blend of Spot, Savings Plans, Reserved Instances, and On-Demand.
Here are the key benefits:
- Effortless cost savings. nOps automatically selects the optimal instance types for you, freeing up your time to focus on building and innovating.
- Enterprise-grade SLAs for the highest standards of reliability. Run production and mission-critical workloads on Spot with complete confidence.
- No vendor-lock in. Just plug in your preferred AWS-native service (EC2 ASG, EC2 for Batch, EKS with Karpenter or Cluster Autoscaler…) to start saving effortlessly, and change your mind at any time.
- No upfront cost. You pay only a percentage of your realized savings, making adoption risk-free.
nOps manages over $2 billion in cloud spend and was recently ranked #1 in G2’s cloud cost management category. Join our customers using nOps to slash your cloud costs and leverage Spot effortlessly by booking a demo today.
