Understanding Google Cloud Platform Pricing Discounts

3 Min Read

Most cloud providers offer customers unique pricing discounts to help reduce the cost of resource usage. For Google Cloud Platform (GCP) customers, there are two main discounts that can be applied to Compute Engine Virtual Machine (VM) usage: Committed Use Discounts and Sustained Use Discounts.

Both discounts offer the ability to purchase committed use contracts in return for deeply discounted prices on VM usage, but each differs in application, rates, eligibility, and more. It’s important to understand what these discount are and how they can be applied to your cloud environment so you can begin taking advantage of their cost saving abilities. We help you get started below.

 

Committed Use Discounts

GCP offers an attractive pricing discount for customers who show a certain level of commitment to compute engines. These discount offerings—called Committed Use Discounts—allow customers to take advantage of varying levels of discounts on machine types by committing to either a 1- or 3-year agreement. Discounts on memory-optimized machine types can be as high as 70%, and up to 57% for most other machine types, which means a little foreplanning on future resource usage can go a long way in terms of cost savings.

Before purchasing a Committed Use Discount, it’s important to remember that even if you don’t use the resource paid for with the discount, you will still be charged for the duration of the term length selected. This often causes fear in GCP users who are hesitant to commit to such a long-term length, which unfortunately leads many to miss out on huge savings opportunities. Thankfully, commitments can be applied with high granularity to match appropriate VM usage down to the microsecond, meaning it’s rare in a large pool of VM’s that one commitment could go unused.

Another added bonus? Unlike other cloud providers who charge upfront costs for discount reservations, GCP users don’t pay anything upfront for Committed Use Discounts—they’re applied directly to your monthly bill and your daily billing export.

Sustained Use Discounts

Unlike Committed Use Discounts, which are discount offerings purchased for a specific term-length, Sustained Use Discounts are automatic discounts given to GCP customers for Compute Engine resources that run for a significant portion of the billing month.

If you’re running a particular virtual machine for an extended duration during the month, GCP will give you up to a maximum 30% net discount on that usage (depending on the instance and other qualifying factors). Sustained Use Discounts are applied differently depending on machine type and rates can vary by region, so understanding your eligibility for these savings isn’t always easy.

Taking advantage of GCP pricing discounts is a crucial step to regaining control and reducing spend in your cloud environment.

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BETTER Headshot Jackson Lucas
Jackson Lucas, Cloud Tech Journalist

Jackson currently reports on cloud industry news, documents cloud best practices, and helps organizations tackle their biggest cloud management challenges. When he's not contributing to the CloudHealth blog, Jackson focuses on retelling VMware's complex product and solution story through enhanced web experiences.

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