News

Firms Seize on AWS Policy Change Disrupting Cloud FinOps

• By David Ramel
• 05/16/2025

A significant shift is underway in the world of cloud financial operations (FinOps), triggered by Amazon Web Services' (AWS) upcoming June 1 deadline that restricts the sharing of Reserved Instances (RIs) and Savings Plans (SPs) across multiple end customers.

This policy change, aimed at reinforcing customer-specific commitments, has upended established cost optimization strategies for many, particularly Managed Service Providers (MSPs) and resellers. However, where disruption strikes, opportunity often follows, and a growing cohort of companies is now stepping forward, eager to provide the tools, services, and alternative solutions to help organizations navigate this evolving landscape and reclaim control over their cloud spending.

AWS in November 2024 announced the policy change taking effect June 1 regarding RIs and SPs, which are AWS pricing models that offer significant discounts in exchange for committing to use specific cloud resources over a one- or three-year term. RIs apply to particular instance types and regions, while SPs offer more flexibility, covering a broader range of compute services. These tools are foundational to cloud cost optimization strategies, especially for organizations with predictable or steady-state workloads.

The Letter
The letter to partners clarified that RIs and SPs are intended solely for use by a single end customer. Beginning June 1, 2025, the company will enforce updated program terms prohibiting partners from applying these discounts across multiple clients -- effectively ending the long-standing practice of centralized commitment sharing. AWS said the move is designed to ensure pricing integrity and give partners time to align their business practices before the deadline:

Dear AWS Partner,

As a valued partner, we appreciate your collaboration and commitment to driving growth and innovation using AWS services. We are writing to inform you of our policies regarding Reserved Instances (RIs) and Savings Plans (SPs).

Amazon EC2 RIs and SPs provide savings for a single end customer's long-term steady state AWS usage, enabling AWS to deliver the lowest possible prices for RIs and SPs. We are updating our program terms to clearly reflect that RIs and SPs are only for a single end customer's AWS usage.

We plan to make these program terms effective beginning on June 1, 2025, giving partners time to update their business practices and plan any necessary communications.

If you have any questions, please visit the FAQs on Partner Central:

FAQ for AWS Solution Providers

FAQ for AWS Distributors

We value our partnership and are committed to supporting you through this transition. Together, we can continue to drive innovation and deliver exceptional value to our customers. Thank you for your attention to this important matter.

Best regards,

Channel Programs Team
Amazon Web Services

The policy change disrupts business models that firms have built around the use of RIs and SPs, commonly called a pooled commitment reseller model wherein MSPs and resellers bought RIs and SPs in bulk under a single account, pooling discounts to spread savings across multiple customers, generating revenue by managing and arbitraging these shared commitments.

"These changes ... shut this model down overnight (pending bespoke, negotiated exceptions)," said Ben Schaechter, co-founder and CEO of Vantage, a company that provides cloud cost management tools and offers automated, customer-specific commitment optimization. "The end-customers will no longer be able to receive the savings from the centralized organizational account," he said last November in a post titled AWS Savings Plan and Reserved Instance Policy Changes for Resellers. "They must have commitments made directly in their account from that point forward to be able to receive savings."

Industry Reaction
Other companies in the cloudspace have also weighed in.

"This means, 'if you signed a commitment, you own it' " a rep for Cloud Capital told AWSInsider. The firm sells a cloud cost management platform. "With 83% of CIOs already spending more on cloud infrastructure than expected, no longer having these cost-saving tricks available could have a material impact on financial performance, burn rate, and runway," the rep said.

With AWS enforcing this shift toward account-level ownership of cloud commitments, several FinOps vendors and related firms that don't rely on shared commitment pools quickly positioned themselves as compliant, future-proof alternatives. So the AWS move sees a new crop of FinOps offerings and initiatives emerging -- not just to comply, but to capitalize. Others just assured customers they have nothing to worry about.

Here's how some firms have addressed the move.

• nOps: "nOps customers are NOT impacted by these changes in any way. Because we don't rely on shared commitment pools, you retain full control of your commitments, ensure full compliance with AWS policies, and experience absolutely no disruption from this change." -- source: AWS Reserved Instance and Savings Plan Changes for 2025
• GlobalDots: "The days of outsourcing RI/SP optimization to a third party are ending, forcing organizations to take full ownership of their cost optimization efforts... If you rely on MSPs for shared RI/SP savings, you'll need to prepare for higher costs or find a compliant alternative." The company in December said the sooner orgs start adapting to AWS's new rules, the smoother the transition will be -- and the less chance of surprises when the new policy kicks in. Companies should:
  • Audit RI/SP workflows to determine reliance on an MSP's shared pool of discounts.
  • Consider alternative automated solutions that maximize savings, maintain workload scaling flexibility, and ensure full compliance with AWS's new terms.
  -- source: Complying with AWS's RI/SP Policy Update: Save More, Stress Less
• North Cloud: "At North, we provide customers with insured and flexible commitments, allowing them to reduce costs while maintaining control over their AWS organization. Our Savings Plans and Reserved Instances are tailored to each customer and not shared across multiple customers. Our platform also helps businesses improve their FinOps operations with AI-driven tools, speeding up time-to-value and ensuring better cost management." -- source: AWS is changing discount sharing rules for resellers.
• RightSpend: "RightSpend is not affected! ... Our commitment management approach has always aligned with AWS's intended usage of RIs and SPs as customer-specific products. We do not rely on shared commitment pools, ensuring our customers: maintain full control of their commitments, have direct visibility into their savings, remain compliant with AWS policies, [and] experience no disruption from this policy change. RightSpend's commitment management approach has always aligned with AWS's intended usage of RIs and SPs as customer-specific products. We do not rely on shared commitment pools, ensuring our customers:
  • Maintain full control of their commitments
  • Have direct visibility into their savings
  • Remain compliant with AWS policies
  • Experience no disruption from this policy change
  -- source: AWS RI and Savings Plan Policy Updates Effective June 2025
• ManageEngine: "Each end customer will now need to manage their own commitments directly to take advantage of discounted pricing... CloudSpend can help organizations navigate the transition by providing detailed tracking and optimization of RI and SP usage, ensuring compliance with AWS's new requirements." -- source: Navigating AWS policy changes in 2025: The role of CloudSpend in mitigating the impacts
• Cloud Capital: In addition to the comments above from the fintech company specializing in cloud financial management, CEO Ed Barrow weighed in on the issue in February, offering up a handy tl;dr that summarizes his post:
  • CFOs must balance cost control with financial flexibility when planning their 2025 cloud budgets.
  • Blend long-term commitments with on-demand pricing, use forecasting tools, and adjust commitments as workloads evolve.
  • Avoid overcommitting to fixed contracts while ensuring financial predictability and scalability.
  • Smart cloud cost management optimizes spend, sustains flexibility, and supports future innovation.

  -- source: How CFOs Can Lock in Cloud Savings Without Sacrificing Flexibility

  Near press time we contacted Barrow for an update on his views with the impending deadline looming. He replied:

  For CFOs and finance leaders, this shift is not just a technicality, it's a fundamental change in how cloud spending will work going forward. For too long, cloud finance has operated on a broken model: businesses sign long-term commitments, but an industry has emerged to help them escape those commitments when they become inconvenient. That model is now unstainable.
  
  For businesses that have built their cost saving strategies around workarounds, the June 1 change will be a rude awakening. The companies that get ahead of this now will have a competitive advantage when the dust settles. Those that don't will be left scrambling. This is not a small issue. Cloud spending represents one of the largest variable costs for most technology companies, and poor management can have a material impact on financial performance, burn rate, and runway.
  
  The bottom line -- AWS needs sustainable commitments and customers need flexibility without financial risk. Vendors like Cloud Capital can bridge that gap by helping AWS customers make the right commitments and structure them in a way that eliminates unnecessary risk.

• Vantage: In addition to CEO Schaechter's comments above, in December he posted to LinkedIn on the issue. In a comment to that post, Tom Cross, a FinOps specialist, said: "Long time coming, but most resellers have been transitioning away from shared consolidated accounts for a while now and it's not like the writing hasn't been on the wall for longer!
  
  

  Schaechter replied: "Agreed on it being a long time coming. Though there are a lot of the startup MSP/resellers that service thousands of startup/SMB/mid-market accounts that I'd be surprised if this went this method....and the customer base has no idea this is coming. So....curious to see how that gets handled."

  We'll see that soon enough.

Other Clouds
AWS's new policy brings it in line with existing practices at Microsoft Azure and Google Cloud Platform (GCP).

Both Azure and GCP have long restricted the use of long-term commitment-based discounts -- such as Azure Reservations or GCP Committed Use Discounts (CUDs) -- to a single customer entity. Azure allows sharing across subscriptions within the same tenant, while GCP permits sharing across projects under a single billing account. However, neither platform permits MSPs or resellers to purchase commitments centrally and distribute the benefits across unrelated end customers.