Using spot instances to cut cloud costs

The key benefit of cloud computing lies in its on-demand pricing model. This enables organizations to grow or shrink their applications at will without giving the cloud provider any advance notification. Cloud providers can only offer such flexibility by building in large amounts of spare capacity, which often goes unused. Because cloud companies allow customers to pay their bills in arrears, based on the resources consumed, they need to charge enough to cover the costs of the extra capacity.

On-demand pricing options are enormously popular, but the bills can quickly mount up. Increasingly, organizations are trying to rein in the costs related to this flexibility. According to the Uptime Institute Data Center Capacity Trends Survey 2022, around 42% of the organizations that moved workloads from the public cloud back to on-premises infrastructure cited escalating costs as the top reason for doing so.