When you launch an instance from an AMI, on top of the compute cost —the EC2 instance— there may be a cost attached to the image’s software. That cost is structured mainly in three models: free (open source), hourly pricing bundled with the instance, and BYOL (bring your own licence).
Understanding the difference avoids surprises on the bill and licence compliance headaches.
The models, clearly
| Model | How you pay | Main advantage |
|---|---|---|
| Free or open source | You only pay for the instance | Minimum cost, no software licence |
| Hourly pricing (PAYG) | The software is billed per hour of use | No commitment: scale up and shut down |
| BYOL | You reuse a licence you already own | You leverage prior investment and keep control |
The three software cost models in a machine image.
Hourly pricing: flexibility above all
In the pay-as-you-go model, the software cost is added to the instance cost and billed per hour or second of use. It is ideal when your workload is variable or unpredictable: no upfront commitment, you scale when you need to and stop paying when you shut down. The trade-off is that with intensive, constant usage it can end up pricier in the long run than amortising your own licence.
- For: zero upfront investment, full elasticity, maintenance and support often included.
- Against: an hourly cost that, added up 24/7, can exceed an amortised licence.
BYOL: make the most of what you already have
With Bring Your Own License you reuse a licence you already own —for instance, from an enterprise agreement— on a cloud image. It can cut costs if you have already invested in licences, but it comes with responsibilities: you must comply with the vendor’s terms, watch the licence’s portability to the cloud and manage compliance yourself.
- For: leverages prior investment, possible savings with constant usage, continuity with your vendor.
- Against: compliance complexity, vendor audit risk and management on your side.
Hidden costs you should watch
- Storage: the image’s EBS snapshots cost money, even if the software is free.
- Data transfer between regions or out to the internet.
- Support: is it included in the hourly price or does it go separately?
- Instance type: the software may require larger instances, pushing compute cost up.
- Licence portability: some BYOL licences require dedicated tenancy, which is more expensive.
How to decide
The rule of thumb: for variable or short-lived workloads, hourly pricing usually wins on flexibility. For constant 24/7, long-lived workloads, amortising a licence or reserving capacity can reduce total cost. Run the numbers with your real usage profile —not the worst case— and remember to include the hidden costs.
Frequently asked questions
Which is cheaper, BYOL or hourly pricing?
It depends on your usage. Hourly pricing wins with variable or intermittent workloads; BYOL can pay off with constant 24/7 usage if you already have licences to amortise.
Does free software in an AMI mean zero cost?
Not quite: even if the software is open source, you still pay for the instance, the snapshot storage and data transfer.
What legal risks does BYOL carry?
You must comply with the vendor’s terms on cloud usage and licence portability. A breach can surface in an audit, so it pays to review the conditions carefully.
At imaxe.cloud we help you understand each image’s cost model so you can choose with the numbers clear.
