Do Google Sustained Use Discounts Really Save You Money?

Do Google Sustained Use Discounts Really Save You Money?

When looking to keep Google Cloud Platform (GCP) costs in control, the first place users turn are the discount options offered by the cloud service provider itself, such as Google’s Sustained Use discounts. The question is: do Google Sustained Use discounts actually save you money, when you could just turn the instance off?

How Google Sustained Use discounts work

The idea of the Sustained Use discount is that the longer you run a VM instance in any given month, the bigger discount you will get from the list price. The following shows the incremental discount, and its cumulative impact on a hypothetical $100/month VM instance, where the percentages are against the baseline 730-hour month.

I have to say here that the GCP prices listed can be somewhat misleading unless you read the fine print where it says “Note: Listed monthly pricing includes applicable, automatic sustained use discounts, assuming the instance runs for a 730 hour month.”  What this means to us is that the list prices of the instances are actually much higher, but their progressive discount means that no one ever actually pays list price. That said – the list price is what you need to know in order to estimate the actual cost you will pay if you do not plan to leave the instance up for 730 hours/month.

For example, the monthly price shown on the GCP pricing link for an n1-standard-8 instance in the Iowa region is (as of this writing) $194.1800. The list price for this instance would be $194.1800/0.7 = $277.40. This is the figure that must be used as the entry point for the table above to calculate the actual cost, given a certain level of utilization.

What if you parked the VM instance instead?

Here at ParkMyCloud, we’re all about scheduling resources to turn off when you’re not using them, i.e., “parking” them. With this mindset, I wondered about the impact of the sustained use discounts on the schedule-based savings. The following chart plots the cost of that n1-standard-8 VM instance, showing Google sustained use discounts combined with a parking schedule.

In this graph, the blue and orange lines show the percent savings from the sustained use discount and scheduling, respectively, based on the number of usage hours.  The grey line shows the blended savings, and the yellow line shows the blended net cost. I am sure the sustained usage discount is described someplace with the typical hype of “the more you spend, the more you save!”  But, the reality of the matter is the more you spend…the more you spend!

Looking at what this means for ParkMyCloud users, here is the monthly uptime for a few common parking schedules, and the associated cost:

Assigned scheduleUptime per 730-hour monthActual monthly cost for notional n1-standard-8  instanceSavings compared to sustained-use cost of $194.18
7am – 7pm weekdays
(60 hours/week)
260.7 hours$93.1352%
8am – 6pm weekdays
(50 hours/week)
217.3 hours$79.9259%
8am – 5pm weekdays
(45 hours/week)
195.5 hours$73.3162%
9am – 5pm weekdays
(40 hours/week)
173.8 hours$66.0566%

Short version: while the 30% sustained use discount does seem like a great deal, any scheduled off time saves you money.  Even with the most wide-open “work day” schedule of running 12 hours per weekday, the cost/month is $93.13, a 52% savings compared to the full sustained-use cost of $194.18.  This includes the 20% sustained use discount for the usage over 182.5 hours. A welcome discount to be sure, but not a really huge impact to the bottom line.

Another way our users keep these utilization hours low is by keeping their VM instances “always parked” and temporarily overriding the schedule for a set number of hours (such as for an 8-hour workday) when their non-production resources are needed. When the duration of the override expires, the instance is automatically shut down. This gives the best possible savings, and usually never even hits the first GCP discount tier.

Do Google Sustained Use discounts save you money?

Well, it depends on how you look at it.  If you are looking at the cost one hour at a time, and you can see the discounts kick in, then it will probably feel like you are saving money.  But if you are looking at the price for a whole month (the way it shows up on your bill), then there is no net savings off the publicly listed (and already discounted) price.

To get the optimal savings on your resources, keep them running only when you’re actually using them, and park them when you’re not. If you meet the usage threshold for any of the Sustained Use Discounts then they will further lower your cost per hour. These two savings options combined will optimize your costs and provide the maximum savings.

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