While On-Demand Instances provide us with very high flexibility, Reserved Instances provide us with save costs for stable workloads that will run over time. We are able to create one or three year reservations for instances within our AWS account of the following types:

• Standard Reserved Instances: For stable, long-running tasks on one type of instance – can provide up to a 75% saving over the on-demand price of the instance
• Convertible Reserved Instances: For stable, long-running task where the instance type is projected to be converted to equal or larger capacity – provides up to a 54% saving
• Scheduled Reserved Instances: For scheduled tasks such as monthly billing

Reserved Instance pricing can be deployed on an availability zone or region scope and will be applied to all instances that match the reservation. For instance, if we have a reservation for an m5.large instance in the us-east-1 region the pricing will be applied as long as an instance is running in any availability zone and any VPC within that region in our AWS account. Payments for Reserved Instances can be any of the following:

• All Upfront: Pay for all your instance hours at the start of the contract and run all of those instances for free. This option offers the biggest discount. 
• Partial Upfront: Pay part of the cost upfront and then get the lowest discounted hourly price.
• No Upfront: Pay nothing upfront and get a discount on the hourly price of the instances.

There is also a reserved instance market where reservations can be traded after the purchase has been made but is no longer needed. This gives us the option to buy reservations for shorter terms and at even lower prices.