---
title: Commitment Programs
description: >-
  Learn how to manage the performance and status of your cloud discount
  programs.
breadcrumbs: Docs > Cloud Cost Management > Planning > Commitment Programs
---

> For the complete documentation index, see [llms.txt](https://docs.datadoghq.com/llms.txt).

# Commitment Programs

{% alert level="info" %}
CCM Commitment Programs supports Reserved Instances and Savings Plans, for EC2, RDS, and ElastiCache on AWS, and Virtual Machines on Azure.
{% /alert %}

## Overview{% #overview %}

Cloud providers offer commitment-based discount programs, such as Reserved Instance (RI) (A billing discount for committing to use a specific instance configuration for a one- or three-year term.) and Savings Plans (Flexible cloud discount programs that provide lower prices in exchange for a commitment to a consistent amount of usage (measured in $/hour) over a term.), to help you save on predictable usage. Datadog's Commitment Programs feature helps you monitor, optimize, and maximize the value of these discounts across your cloud environments.

With Commitment Programs, you can:

- Track and address unused or underused commitments
- Target high on-demand (Cloud resources billed at standard rates, without any commitment or discount program.) spend with additional commitments
- Monitor expirations and plan timely renewals

## Getting started{% #getting-started %}

Use Commitment Programs to understand and optimize your cloud commitments.

1. Go to [**Cloud Cost > Planning > Commitment Programs**](https://app.datadoghq.com/cost/plan/commitment-programs) in Cloud Cost Management.
1. Use the product selector to choose a commitment type and the time frame selector to set the reporting period.
1. Gain insights into your KPIs, commitment costs, and renewal recommendations:
   - Review KPIs in the Commitments overview section.
   - Analyze areas of on-demand spend to understand how to improve your coverage in the On-demand hot-spots section.
   - View active commitments by type in the Commitments inventory table.
   - Identify savings plans generating the most waste in Least used savings plans.
1. Take action based on these insights:
   - Adjust workloads to better use your commitments and avoid extra on-demand charges.
   - Update commitments by buying or changing them based on your usage data.
   - Plan renewals or retire commitments before they expire.
   - Optimize spend using Datadog's recommendations to save more and reduce waste.

## Commitments overview{% #commitments-overview %}

Review these Key Performance Indicators (KPIs) for your cloud providers and services:

{% image
   source="https://docs.dd-static.net/images/cloud_cost/planning/commitments-inventory.f6175acb509bb9669097fdcdcacac81e.png?auto=format&fit=max&w=850 1x, https://docs.dd-static.net/images/cloud_cost/planning/commitments-inventory.f6175acb509bb9669097fdcdcacac81e.png?auto=format&fit=max&w=850&dpr=2 2x"
   alt="Commitments Overview dashboard showing key savings metrics and a bar chart comparing commitment costs to equivalent on-demand costs over time." /%}

- Effective Savings Rate (ESR): Percentage of cost savings achieved by your discount programs compared to on-demand prices, factoring in both utilized and underutilized commitments.
  - *Example: Your RIs may offer a 62% discount, but if your ESR is only 45%, underutilized commitments are reducing your actual savings.*
- Realized Savings: Total dollar amount saved by using commitment programs versus on-demand rates.
  - *Example: You spent $10,000 on cloud services last month, but would have spent $14,000 at on-demand rates, so your absolute savings is $4,000.*

## On-demand hot-spots{% #on-demand-hot-spots %}

On-demand hot-spots highlight areas with high on-demand costs, which may indicate opportunities to purchase additional commitments.

{% image
   source="https://docs.dd-static.net/images/cloud_cost/planning/commitments-on-demand-2.56b6fb0ff78e6a4e4acff0ec1c55c320.png?auto=format&fit=max&w=850 1x, https://docs.dd-static.net/images/cloud_cost/planning/commitments-on-demand-2.56b6fb0ff78e6a4e4acff0ec1c55c320.png?auto=format&fit=max&w=850&dpr=2 2x"
   alt="On-Demand Hot-Spots table for AWS RDS showing region, instance family, DB engine, coverage percentage, and on-demand cost." /%}

Use the Cost and Hours tabs to toggle between on-demand spend in dollars or usage in hours. Use the available filters to narrow results—filters vary based on the selected product.

The table columns correspond to the filters for the selected product, showing the dimensions that characterize the on-demand usage (such as region, instance family, or database engine), along with Coverage (percentage of usage covered by commitments) and On-Demand Cost (sorted in descending order to surface the highest-spend hot-spots first).

## Commitments inventory{% #commitments-inventory %}

Commitments Inventory provides a detailed view of commitments active during the selected time frame, organized by commitment type. This includes commitments expiring soon (within 30 days) and commitments that have already expired at the time of viewing.

{% image
   source="https://docs.dd-static.net/images/cloud_cost/planning/commitments-inventory-1.811c86286204c12e58f509a7d90ead96.png?auto=format&fit=max&w=850 1x, https://docs.dd-static.net/images/cloud_cost/planning/commitments-inventory-1.811c86286204c12e58f509a7d90ead96.png?auto=format&fit=max&w=850&dpr=2 2x"
   alt="Commitments Inventory section showing the Savings Plans tab with a utilization chart and a table of EC2 savings plan commitments." /%}

Use the Savings Plans and Reserved Instances tabs to switch between commitment types. Each tab shows:

- Utilization: Percentage of the commitment type being used during the selected period.
- Unused spend: Total spend on unused commitments.
- Daily chart: Tracks used and unused commitment spend alongside the utilization rate over time.

Use the Only show Expiring checkbox to filter the table to commitments nearing their end date.

The table lists your active commitments. Columns vary depending on the product and commitment type, but common columns include:

| Column                                              | Description                                                             |
| --------------------------------------------------- | ----------------------------------------------------------------------- |
| Savings Plan ARN, Reservation ARN, or Commitment ID | Unique identifier for the commitment (Commitment ID for Azure).         |
| Benefit Name                                        | Name of the Azure savings plan or reservation benefit.                  |
| Payment Model                                       | Payment option (for example, No Upfront, Partial Upfront, All Upfront). |
| Term                                                | Duration of the commitment (for example, 1 Year, 3 Years).              |
| Type                                                | The commitment type (for example, `ComputeSavingsPlans`).               |
| Committed Spend/HR                                  | Hourly spend committed under the plan.                                  |
| End Date                                            | Date the commitment expires.                                            |
| Utilization                                         | Percentage of the commitment used during the selected period.           |

Use the Columns button to show or hide additional columns.

## Least used savings plans{% #least-used-savings-plans %}

Least Used Savings Plans helps you identify which savings plans are generating the most waste. Use this section to determine when that waste occurs and take action to improve utilization.

{% image
   source="https://docs.dd-static.net/images/cloud_cost/planning/commitment-programs-least-used-savings-plans-1.4f575a73b21c79679783b66c83c6c076.png?auto=format&fit=max&w=850 1x, https://docs.dd-static.net/images/cloud_cost/planning/commitment-programs-least-used-savings-plans-1.4f575a73b21c79679783b66c83c6c076.png?auto=format&fit=max&w=850&dpr=2 2x"
   alt="Least Used Savings Plans section showing a bar chart of daily average unused savings plan spend by day of week, a table of the most wasteful savings plans with waste amount, utilization, and ARN, and a heat map of hourly unused committed spend percentage by day of week." /%}

Daily average unused Savings Plans: A bar chart showing the average daily cost of unused savings plan spend for each day of the week. Use this to spot patterns, such as higher waste on weekends when workloads may be lower.

Savings Plans with most waste: A table listing underutilized savings plans, sorted by total waste. Columns include:

- Waste: Total dollar amount of unused committed spend during the selected period.
- Utilization: Percentage of the savings plan being used, shown as a percentage and progress bar.
- Savings Plan ARN: Unique identifier for the savings plan.

Hourly unused committed spend percentage: A heat map showing the percentage of committed spend that went unused, broken down by hour (UTC) and day of week. Darker cells indicate higher unused percentages, making it possible to identify specific time windows where commitments are consistently underused.

## Savings Plan simulation{% #savings-plan-simulation %}

{% alert level="info" %}
Savings Plan simulation is in Preview. It supports AWS Savings Plans and runs at the [AWS management account](https://docs.aws.amazon.com/organizations/latest/userguide/orgs_getting-started_concepts.html#management-account) level.
{% /alert %}

Savings Plan simulation lets you estimate the impact of a new Savings Plan on your bill before you purchase it. Instead of stitching together Cost Explorer exports and spreadsheets, you can model a commitment against your historical usage. The results show the projected coverage, utilization, and savings.

The simulation is retrospective. It re-prices your on-demand usage from the selected period as if the Savings Plan had been active. The results show what your cost and savings *would have been*, not a forecast of future usage.

{% image
   source="https://docs.dd-static.net/images/cloud_cost/planning/commitment-simulation.46ea371c27cbc1b0fe3c0331b35db98e.png?auto=format&fit=max&w=850 1x, https://docs.dd-static.net/images/cloud_cost/planning/commitment-simulation.46ea371c27cbc1b0fe3c0331b35db98e.png?auto=format&fit=max&w=850&dpr=2 2x"
   alt="Savings Plan simulation showing the input parameters, an Estimated Impact summary with a before-and-after metrics table, and a Simulated Cost time series chart." /%}

### Run a simulation{% #run-a-simulation %}

1. Go to the [**Simulator**](https://app.datadoghq.com/cost/plan/commitment-programs/simulator) tab in **Cloud Cost > Planning > Commitment Programs**.
1. Choose the Savings Plan type, then set your commitment preferences: the owner account, term, and payment model.
1. Enter an additional hourly commitment and choose the usage period to simulate against, up to the last 3 months. The period defaults to the past 30 days.
1. Review the projected results in the Estimated Impact and Estimated Service Breakdown sections.

If [AWS Cost Optimization Hub](https://docs.aws.amazon.com/cost-management/latest/userguide/cost-optimization-hub.html) has a Savings Plan recommendation for your organization, it appears in a callout. The callout shows the suggested hourly commitment, term, and payment option. Click it to apply those settings to the simulation. Cost Optimization Hub generates these recommendations for Compute Savings Plans only.

To receive these recommendations, make sure your AWS integration IAM role includes the `cost-optimization-hub:GetRecommendation` and `cost-optimization-hub:ListRecommendations` permissions. For setup steps, see [Permissions for AWS Cost Optimization Hub recommendations](https://docs.datadoghq.com/cloud_cost_management/setup/aws.md#permissions-for-aws-cost-optimization-hub-recommendations).

### Interpret the results{% #interpret-the-results %}

All outputs are estimates based on your usage during the selected period, and actual savings depend on your future usage. Because Savings Plans are shared across a [Consolidated Billing Family](https://docs.aws.amazon.com/savingsplans/latest/userguide/sp-applying.html), a commitment can apply to usage in multiple accounts. If Datadog is missing cost data for the period, the simulator flags the results as incomplete.

Results appear in two sections:

- Estimated Impact: Compares your key metrics before and after the simulated commitment, alongside a Simulated Cost chart over the selected period.
- Estimated Service Breakdown: Breaks down the estimated cost and coverage by AWS service.

## Example use cases{% #example-use-cases %}

### Identify underutilized commitments{% #identify-underutilized-commitments %}

**Scenario**: Your Effective Savings Rate (ESR) is lower than expected, even though your coverage is high.

**How to use commitment programs**:

1. Go to the Commitments Overview and check the utilization KPI.
1. In the Commitments inventory, sort by utilization in ascending order to identify the least-used commitments. For savings plans, also check the Savings Plans with most waste table in the Least used savings plans section.
1. Reallocate workloads to use these commitments more effectively, or consider modifying or selling unused commitments if your cloud provider allows it.

### Plan for expiring commitments{% #plan-for-expiring-commitments %}

**Scenario**: Several Reserved Instances are expiring soon, and you want to avoid unexpected on-demand charges.

**How to use commitment programs**:

1. In the Commitments Explorer, review the list of commitments and their expiration dates.
1. Use the filters to focus on soon-to-expire commitments.
1. Plan renewals or replacements in advance to maintain coverage and maximize savings.

### Target high on-demand spend{% #target-high-on-demand-spend %}

**Scenario**: Your cloud costs show consistently high on-demand usage for a particular service or region.

**How to use commitment programs**:

1. Use On-demand hot-spots to identify which services, regions, or accounts have significant and steady on-demand costs.
1. Analyze usage patterns to confirm they are predictable.
1. Purchase new commitments to cover the consistent usage and reduce costs.

### Reduce waste by shifting workloads to cover unused savings plans{% #reduce-waste-by-shifting-workloads-to-cover-unused-savings-plans %}

**Scenario**: You have underutilized savings plans and high on-demand costs running in parallel.

**How to use commitment programs**:

1. Use the Least used savings plans section to identify recurring patterns of low utilization—for example, consistently unused capacity on certain days or hours.
1. Identify on-demand workloads that could be scheduled during those low-utilization windows to take advantage of unused savings plan coverage.
1. Shift or reschedule those workloads to reduce on-demand spend and improve savings plan utilization.

## Further reading{% #further-reading %}

Additional helpful documentation, links, and articles:

- [Learn about Cloud Cost Management](https://docs.datadoghq.com/cloud_cost_management.md)