Glossary

P

Related Definitions

Reserved Instances

What are reserved instances?


Reserved Instances (RIs) are a pricing and capacity reservation offering provided by AWS for their EC2 (Elastic Compute Cloud) and RDS (Relational Database Service) services.


They specifically allow users to commit to using a specific instance type in the same region for either a one or three-year term, in exchange for discounts of up to 72% – the exact discount is ultimately dependent on the commitment term, instance type, availability zone and region.


There are various types of Reserved Instances available, each with different terms and levels of flexibility. Standard Reserved Instances provide the highest cost savings but are the least flexible, whereas Convertible Reserved Instances offer more flexibility by allowing you to change instance families within the same instance type.


In contrast, Scheduled Reserved Instances offer a lower discount, but allow you to reserve capacity for specific time windows, such as business hours or weekends, providing cost savings for predictable workloads.

Learn More

Enterprise License Agreement (ELA)

What is an ELA?


An Enterprise License Agreement (ELA) is a contract between a software vendor and an enterprise customer that sets out the terms and conditions for the licensing of software products across an enterprise. Unlike a Master License Agreement (MLA) which is a more comprehensive business agreement that can cover a range of products and services, an ELA is often used for specific software products.


While the specific terms and conditions of an ELA can vary, it will typically outline the number and type of licenses covered under the agreement, restrictions or limitation on usage, the duration of the agreement, the fees associated with the license, renewal terms and termination clauses.

Learn More

Decentralized Procurement

What is decentralized procurement?


Decentralized purchasing in SaaS refers to the process of allowing individual departments or teams within an organization to make their own purchasing decisions for software applications. This is in contrast to a centralized purchasing model, where all purchasing decisions are approved by a single procurement team or a department such as finance.
While a decentralized purchasing model can provide teams with the flexibility to select and purchase the tools that best meet their needs, without having to wait for approvals or navigate bureaucratic purchasing processes, it can create challenges for the company. This can include reduced buying power, higher costs, lack of control over vendor relationships, and increased compliance and legal risks.

Learn More

Cloud Unit Economics

What is cloud unit economics?


By definition, cloud unit economics refers to the financial analysis and evaluation of both the costs and revenue associated with operating a cloud-based business.


In other words, it’s a way of looking at how much it costs to run your business on the cloud, as well as how much it brings in.

Learn More

Pricing Benchmarks

What are pricing benchmarks?


In SaaS, price benchmarking often refers to the process of comparing the cost of software to that of an alternative provider. Using this insight, buyers may be able to leverage a more favorable counteroffer from their vendor of choice. The most effective approach to benchmarking prices and securing the best possible deal on any subscription, however, is to find out what other similar companies are actually paying for the software.

Learn More

Data Storage

What is meant by data storage?


In the context of cloud computing, data storage refers to the process of storing and managing digital information in either a remote server or a data center provided by a cloud service provider such as Amazon Web Services (AWS) or Microsoft Azure.


The cloud ultimately provides a versatile platform for storing various types of data, whether that be documents, media files, application data, machine learning data or structured data.

Learn More