Committed Use Discounts - GCP Cost Management

Committed Use Discounts (CUDs) are a cost-saving program provided by Google Cloud. Users can enjoy significant discounts by purchasing a 1-year or 3-year committed use contract. This is great for stable and predictable resource needs. This article will explain Compute Engine's committed use discounts in detail, covering different discount types, applicable conditions, and actual application scenarios.

If you want to know how to achieve the best results in GCP cost savings, you can refer to:How to maximize cloud benefits through GCP savings and discounts?

Resource-type committed usage discount

Resource-based CUDs apply when you commit to using a minimum amount of resources within a specific region and project. This type of discount is suitable for stable resource needs, such as:

• vCPUs
• memory
• GPU
• Local SSD
• Sole-tenant nodes
• Operating System (OS) Authorization

Discount example

• Memory-optimized machines enjoy up to70% discount.
• Other machine series highest55% off.
• SUSE Linux Enterprise Server image licensing is reachable79% off.

The scope of application and operation mode of resource-based CUDs

• Applicable resources
  • Compute Engine's vCPUs, memory, GPU, local SSD.
  • Exclusive node and operating system authorization.
• How it works
  • The contract becomes effective at 12:00 AM (Pacific Time) the day after purchase.
  • Billing is monthly regardless of whether the resource is fully used.
  • Cancellation is not possible during the contract period.

Flexible Commitment Usage Discount

Elastic CUDs are cost-based discounts that apply to your total consumption on services such as Compute Engine, Google Kubernetes Engine (GKE), and Cloud Run. Its main features include:

• Not limited to specific projects, regions or machine families.
• Ideal for predictable spending needs across multiple Google Cloud services.
• Applicable resources:
  • vCPUs
  • memory

Discount example

• 1 year contract:Enjoy28% discount.
• 3 year contract:Enjoy46% off.

The scope and operation of flexible CUDs

• Applicable resources
  • Supports Compute Engine, GKE and Cloud Run.
  • Available for general purpose (C3, N1, etc.), compute-optimized (C2), and storage-optimized (Z3) machine families.
• How it works
  • Effective at time of purchase, minimum spend per hour is committed.
  • If the actual usage exceeds the committed amount, the excess will be charged according to on-demand pricing.

Discount application order

It should be noted that the Compute Engine discount types provided by Google Cloud are mutually exclusive and cannot be applied to the same resource at the same time. At any time, a resource can only enjoy one of the discounts. If a certain part of resource usage has enjoyed a specific discount type, the remaining discounts will not be applicable to that part of the usage. When you purchase resource-based and elastic commitment usage discounts for Compute Engine resources at the same time, Google Cloud will intelligently optimize how the commitment is used according to the following sequence:

1. Resource-based CUDs discounts are applied first.
2. Then apply the flexible CUDs discount.
3. The remainder is subject to on-demand pricing andRenewal Discounts (SUDs).

Example application scenarios

Resource-based CUDs application

Assuming you purchase 3-year resource-based CUDs for a specific region, including 16 vCPUs and 64 GB of memory, then:

• The resource has a fixed discounted price per hour.
• Commitment fees are still payable even if part of the time is not used.

Flexible CUDs Application

Assume you purchase 3-year flexible CUDs at US$100 per hour:

• If the use of vCPUs, memory and other resources reaches US$150, then:
  • Discount on US$100 of resources.
  • Any excess of US$50 will be billed according to the on-demand pricing.

in conclusion

Committed use discounts provide stable and flexible cost management options to suit different types of workload needs. Whether it is resource-based discounts for stable demand or flexible discounts for multi-service expenditures, it can help users significantly reduce cloud computing operating costs.

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