Community Blog Alibaba Cloud Savings Plans: More Flexible than Subscription and More Cost-Effective than Pay-as-you-go

Alibaba Cloud Savings Plans: More Flexible than Subscription and More Cost-Effective than Pay-as-you-go

Alibaba Cloud Savings Plans is our latest billing method that provides you with the flexibility of Pay-as-you-go billing, while maintaining the cost efficiency of subscription billing.

If you are familiar with Alibaba Cloud Elastic Compute Service (ECS), or similar cloud computing products, you may already be familiar with both subscription and pay-as-you-go billing methods. Essentially, for each of the two billing methods, you get to choose to enjoy either more flexibility or lower costs, depending on your needs. And for a while, there were not many convincing alternatives that could provide the best from both worlds. That is, until now! Alibaba Cloud has launched a new billing method, Savings Plans, which is an innovation to the existing billing methods.

Is Savings Plans Suitable for Me?

For an enterprise, the flexibility of its upper-level services cannot be separated from the supply and purchase of underlying IT resources. With the emergence of cloud computing, more flexibility is given to enterprises and more attention is paid to cloud native and Serverless.

With the in-depth development of cloud computing, enterprises in China are becoming increasingly good at using cloud services. The rapidly changing business has also made enterprises demand more flexible IT architectures and configuration of underlying resources. Under this circumstance, subscription, the mainstream billing method for cloud resources, cannot meet enterprises' demands of resource flexibility.

However, if all resources are purchased on a pay-as-you-go basis, the cost will undoubtedly be high. For that reason, Alibaba Cloud Elastic Compute Service (ECS) has announced a new billing method called Savings Plans, for purchasing cloud resources.

What Is Savings Plans?

A savings plan is a discount plan that allows you to receive pay-as-you-go billing discounts in exchange for a commitment to use a consistent amount (measured in dollars per hour) of resources over a one- or three-year period. After you purchase a savings plan, the hourly bills of your pay-as-you-go instances are covered up to the amount of the plan.

In simple terms, Savings Plans is a new billing method that is more cost-effective than pay-as-you-go and more flexible than subscription.

Enterprises only need to purchase the annual card of Savings Plans based on their actual consumption of cloud resources per hour. By doing so, they can get a discount for the amount of resources within the usage range that they purchase. A membership price for corresponding cloud resources will be offered, with the maximum discount for some instances reaching 76.2%. You can think of the annual card for Alibaba Cloud ECS Savings as a "VIP Card for ECS". Moreover, during Double 12, Alibaba Cloud ECS introduced two kinds of "additional discount" cards. Card holders can enjoy an additional discount of 41% to 46% based on the membership price of the Savings Plans.

Visit the official documentation of Savings Plans to learn more >>

Savings Plans: A Testament to Alibaba Cloud's Deliverability

Savings Plans, as a billing method, is in fact a test for the scale effect and deliverability of cloud providers. Zhang Xiantao, director of Alibaba Cloud ECS, stated that pay-as-you-go is the best way to purchase resources in the cloud-native era, while Savings Plans can help achieve the best balance between costs and flexibility for pay-as-you-go. Therefore, Savings Plans requires the massive scale effect and strong deliverability of cloud providers.

In the early days of cloud computing, most Chinese enterprises are familiar with subscription billing, which in turn simplifies the infrastructure for cloud providers as they were able to readily predict demands based on purchase history alone. However, as cloud services became increasingly complex, the rigidity of subscription billing became a limiting factor for many users. More and more enterprises started combining pay-as-you-go with subscription billing to cope with the ever-changing demands from customers.

As a matter of fact, purchasing resources by subscription is similar to renting an ECS instance in a specified region for a fixed duration. Therefore, it is difficult to change the region or configurations that have already been set. Users who purchase Savings Plans cards need not worry about this as they can freely modify the regions or specifications of their cloud resources at any time to meet their business demands.

Savings Plans Ensures Cost-effective, Flexible, and Reliable Resources

To ensure the supply and availability of resources, Alibaba Cloud has launched the industry's first full-procedure resource guarantee service. By updating the concept of quota, this service introduces the concept of "resource reservation" in order to meet the requirements for resource assurance in certain business scenarios.

Users can choose between the "elastic guarantee" or the "capacity reservation" option as needed to lock specific resource capacities within a certain period of time. This allows critical business instances to always be operational while giving the added flexibility for businesses to adapt to changes. Combined with Savings Plans, this service provides enterprises with an extremely elastic cloud experience, while ensuring flexible, reliable, and cost-effective use of pay-as-you-go resources.

The flexibility, certainty, and low cost of IT resource configuration have always been crucial to enterprises. However, it is difficult to meet the three requirements at the same time with traditional billing methods. Alibaba Cloud's Savings Plans and resource guarantee can help you achieve this, relying on the strong deliverability and resource scheduling capabilities of our platform.

Ready to save more on your computing resources? Visit the Savings Plans page to learn more!

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