What price do I eventually pay for a AWS spot-instance and do I drive up the prices

Question

I would like to create an auto scaling group [ASG] with spot instances as a supplement to my production ASG that has on-demand instances.

After reading this post , I would like to mimic it but maybe without the dynamic bidding and auto-scaling at first.

So, I was wondering , if I just set the bid price for the spot instances equal to the on-demand price of the instance I use [m3.large] , would I be paying the lowest bid price [for that instance, in the region, in that hour] ??

So if the spot price is $0.01 and my max bid in the ASG is $0.067 , I would be paying $0.01 for every spot instance the ASG launches, right?? [That is what I understood from the AWS docs but I would like a confirmation]

And finally, by this kind of thinking [that I suppose I am not the only one to have] do I drive the spot instance prices up ?

Answer 1

• Spot instance prices vary according to Availability Zones present in a Region. So you have to pay based on the market price where the launched instances are located.

• Your bid is only the maximum amount that you want to pay for the spot-instances.
•  The market prices are driven by availability of free resources and market demand.

when you set a bid price then some of these senarios are followed - 

• If the market price is less than or equal your bid (Market <= Bid) and there are free resources on spot-instances pool, then you pay the market price.
• If the market price is higher than your bid (Market> Bid) or there are no free resources on spot-instances pool, your spot-instances will be terminated and no need to pay the current partial hour. You only need to pay the full hours that you used.
• If you run spot-instances less than an hour and you terminate it by yourself, you need to pay for that partial hour.

example- There are 2 instance available, and there are 3 bids for $1, $2, and $3, the two highest bidders will get the running instances, and the market price would be $1. So, your bid price may drive the spot instance indirectly if you are a winning bidder and there are more open bids than available spot instances