The cloud's biggest promise was "pay only for what you use." Yet once you actually run something in production, a paradox appears: a bill built purely on On-Demand can end up more expensive than just buying on-premises servers. That's because you're paying a monthly premium for the privilege of "borrowing instantly, whenever you need it" on a database server you obviously intend to keep running 24/7. AWS's compute discount system — Reserved Instances, Savings Plans, Spot — is the mechanism that resolves this paradox, and at its root is an economic model in which AWS hands two of the risks it bears from running data centers back to the customer, and gives a discount in exchange