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Maximizing the benefits of ISF when purchasing RIs for Linux EC2 instances

With Amazon’s announcement of Instance Size Flexibility (ISF), you’ll see changes throughout Cloudability, most noticeably in our RI Planner when you look for recommendations of which instance types to buy next. Historically it’s been necessary -- and we recommended -- you purchase RI’s of varying sizes per family, to match your exact usage. Having the RI planner work out all the combinations you need to purchase is awesome and leads to major savings, but inevitably it comes with a decent administrative overhead. We are still stuck with this world for non-Linux instances, but being thoughtful with how we adapt to ISF is going to reduce the administrative overhead and lead to overall greater savings. For cases where ISF can apply you’ll see our planner optimize for this scenario to obtain maximum benefits. The main thing to look for is the large purchase list within a family being collapsed into a single row of a small instance size. Let’s dive into why.

RI Planning with ISF

What is ISF?

ISF is a new feature of EC2 RI's that lets the savings of an RI apply to any size of instance within a family. You automatically get this benefit when you purchase a regionally scoped Linux RI.

How does ISF work?

ISF manages your reservations in a points based system, where a scale determines the units assigned to each size within a family. When you run an instance, r4.xlarge for example, any ISF RI within the r4 family can apply to the instance and the number of points your RI has relative to the points for the instance size ran determines how much or how many of the RI is consumed by that instance hour. To understand what the scale is and how billing works for ISF RI’s, read our knowledge base article on ISF.

What are the changes in the RI Planner?

As mentioned we’ve incorporated ISF features into our recommendations engine for the RI Planner to make your life (far) easier. We still analyze your hour-by-hour instance usage and take into account your entire RI inventory, including ISF and non-ISF RI’s, before making a recommendation. For ISF RI’s, because any size RI can apply to an instance you run within a family, you’ll no longer need to purchase a variety of sizes and instead can purchase to the family and region based on normalized units. Effectively you can abstract away the concept of purchasing to your instance type profile and instead just purchase ‘points’. There are a number of ways you could achieve this, but after much internal scenario testing and discussion with our biggest customers we’ve established an effective pattern which we’ve built into the planner.  

The example below illustrates a way of thinking about how ISF can be applied. Each column represents the instances that were run in a given hour. For r4’s and c4’s, large (L) is the smallest instance size. The concept of targeting a waterline is still completely valid and if we were to aim for 100% RI utilization in this example you'd purchase 19 large RI’s. What we are effectively suggesting here is purchasing ‘points’ at the smallest size within a family. This would mean you'd have only 1 actual RI purchase which is well matched to your usage. If instance sizes fluctuate, but your overall normalized usage stays the same or increases, your RI’s will remain perfectly utilized.

ISF_comparison_chart.png

Looking at the RI Planner details page, you can see how we apply ISF to the c4 family.

ISF_in_planner.png

Our recommendations engine analyzes your usage and determines the break even point same as before. The histogram we’ve adjusted to represent Normalized Instances, where in this case, we convert all your existing RI’s, i.e. 260 xlarge, 18 8xlarge, 8 large, and 2 large (AZ scoped), to represent the number of units relative to a large. You can find the breakdown of Units for each size in the existing RI table. Once we determine the coverage you will need, we recommend the smallest instance size for the family. In the case of c4’s, the smallest size is a large and we recommend you buy an additional 1720 c4.large RI’s to cover your usage. 

Our Strategy

The philosophy we've taken is to maximize savings with the least management overhead. For this reason, we make recommendations for the smallest instance size possible. This allows for maximum coverage with the smallest set of RI parcels. Note that the parcels themselves will be large and you may need to request an increase to your RI purchase limit from Amazon to accommodate the purchase of a large quantity of small instances sizes (to find out how to request the increase, click here). You’ll benefit from a more streamlined RI lifecycle with the purchase of the large quantity, rather than in the past where you would have multiple purchases of a variety of sizes per family. This strategy will also help you better manage your inventory if your usage decreases, with the ability to sell off a much more granular number of RI units to fit the new usage patterns. 

Best Practices

Our most cloud-savvy customers have already converted their non-capacity constrained RI inventory to be ISF-eligible, by making sure all their Linux RI's are set to be regional scoped.

As Andrew Hatch, DevOps Manager at Seek mentioned, “Switching our RI fleet over to take advantage of ISF was a no-brainer. Using the streamlined strategy implemented within Cloudability is going to save us a ton of management headache into the future and lead to bigger savings from our RI initiatives.”

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