I have made a rough comparison for the classic “on demand” small instance against the new reserved instance:

On Demand Instance:
$0 + (365*24*$0,10) = $876/year = $73/month

Reserved Instance 1year:
$325 + (365*24*$0,03) = $588/year = $50/month
Saves you $288/year or $24/month.

Reserved Instance 3years:
$500 + (3*365*24*$0,03) = $1288/3years = $430/year = $36/month
Saves you 446 $/year or 37$/month.

Here’s the offical FAQ on using Reserved Instances. And here’s a funny but critically blog post about the “single commandline that can costs you losts of money“. I think Marc Musings is right and I wish that Amazon would improve this because I had the same bad emotions with this “new API feature”. It would basically a good idea to have alerts and/or limits for charges, instances and traffic.

Can’t wait for reserved Instances to be available for the EU region… “in the near future” as Amazon promised… Happy emotions when spending big money with ec2-purchase-reserved-instances-offering!

UPDATE 09-08-21: New Lower Prices for Amazon EC2 Reserved Instances and I’m also happy to see that one of my EC2 instance hit the 500 days uptime mark.