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Reservation discount (also called commitment discount) lets you guarantee a minimum spend or usage level on any metered charge, charge a premium for usage above that level, and optionally enforce the minimum even when actual usage falls short all configurable per charge, per subscription.

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Who is it for?

  • Cloud infrastructure — GPU/CPU reservations, storage commitments
  • AI / ML platforms — inference-hour commitments, training-job minimums
  • SaaS & API providers — API-call or data-transfer commitments

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Key Terminology

CommitmentThe guaranteed minimum a customer agrees to for a billing period. Can be expressed as a currency amount (e.g. $1,000/month) or a unit quantity (e.g. 500 GPU-hours/month).
OverageUsage above the commitment. Charged at unit price × overage factor — the factor can add a premium (1.5×), keep the same rate (1.0×), or even discount excess (0.8×).
Overage FactorA multiplier applied to the excess cost beyond the commitment. 1.5× = 50% premium, 1.0× = no premium, 0.8× = 20% discount on excess.
True-UpWhen enabled, the customer always pays at least the full commitment amount — even if actual usage is lower. The shortfall is added as a true-up fee. When disabled, the customer pays only for what they used.
Commitment Type: AmountCustomer commits to a minimum amount per period.
Commitment Type: QuantityCustomer commits to a minimum number of units per period. The commitment cost is derived as quantity × unit price.

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How Billing Works

For each billing period, Flexprice evaluates one of two outcomes:
  • Usage ≥ Commitment → Total = Commitment + (Usage Cost − Commitment) × Overage Factor. The customer pays the committed amount at standard rate, plus a premium on everything above it.
  • Usage < Commitment, True-Up enabled → Customer pays the full commitment amount (shortfall added as true-up fee).
  • Usage < Commitment, True-Up disabled → Customer pays only for actual usage.

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Example 1 — AI Inference Platform (Per-Period Commitment)

An AI platform sells inference compute at $2 / vCPU-hour. They want customers to commit to a minimum of 500 vCPU-hours/month and charge a 1.5× premium on any usage above that.
1

Requirement

ParameterValue
Metered chargevCPU-hours
Unit price$2 / vCPU-hour
Commitment500 vCPU-hours/month (= $1,000/month)
Overage factor1.5×
True-upEnabled
2

Pricing in the plan

The vCPU-hours line item is configured with a unit price of $2 / vCPU-hour in the pricing plan.
Pricing configured in the plan
3

Configure commitment from the line item

Navigate to Customers → Select a customer → Add Subscription, and select your pricing plan. Once the plan is loaded, click the three-dot menu (...) next to the vCPU-hours charge and select Configure Commitment.
Select 'Configure Commitment' from the line item menu
4

Configure the commitment details

In the configuration modal, set the commitment type to Quantity with a value of 500, apply an overage factor of 1.5x, and enable True Up. Save the commitment and proceed to create the subscription.
Configure commitment type, quantity, overage factor, and true-up
5

Scenario 1 — Usage exceeds commitment (700 vCPU-hours)

Overage qty:    700 − 500 = 200 vCPU-hours
Commitment:     500 vCPU-hours × $2          = $1,000
Overage:        200 vCPU-hours × ($2 × 1.5)  = $600
Total Invoice:  $1,000 + $600                = $1,600
6

Scenario 2 — Usage below commitment, true-up enabled (300 vCPU-hours)

True-up is enabled so the full commitment is enforced.
Shortfall qty:  500 − 300 = 200 vCPU-hours
Usage cost:     300 vCPU-hours × $2  = $600
True-up fee:    200 vCPU-hours × $2  = $400
Total Invoice:  $600 + $400          = $1,000
7

Scenario 3 — Usage below commitment, true-up disabled (300 vCPU-hours)

Same usage but with true-up turned off. The customer pays only for what they consumed.
Usage cost:     300 vCPU-hours × $2  = $600
Total Invoice:                       = $600

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Example 2 — Cloud Infra Company (Windowed Commitment)

A cloud infrastructure company sells GPU compute at $2 / GPU-hour. Instead of a single monthly commitment, they want to commit customers on an hourly basis — a minimum of 10 GPU-hours every hour. Each hour settles independently and the totals are summed at the end of the billing period.
Windowed commitment is available only on bucketed features. The window size is inherited from the meter’s bucket configuration.
1

Requirement

ParameterValue
Metered chargeGPU-hours
Unit price$2 / GPU-hour
Commitment10 GPU-hours per hour (= $20/hour)
Overage factor1.5×
True-upEnabled
WindowHourly
2

Pricing in the plan

The GPU-hours line item is configured with a unit price of $2 / GPU-hour in the pricing plan.
Pricing configured in the plan
3

Configure commitment from the line item

Navigate to Customers → Select a customer → Add Subscription, and select your pricing plan. Once the plan is loaded, click the three-dot menu (...) next to the GPU-hours charge and select Configure Commitment.
Select 'Configure Commitment' from the line item menu
4

Configure the windowed commitment details

In the configuration modal, set the commitment type to Quantity with a value of 10. Apply a 1.5x overage factor, enable both True Up and Windowed Commitment, and save your changes before creating the subscription.
Configure commitment for windowed setup
5

Hour 1 — Usage exceeds commitment (15 GPU-hours)

Overage qty:    15 − 10 = 5 GPU-hours
Commitment:     10 GPU-hours × $2          = $20
Overage:        5 GPU-hours × ($2 × 1.5)   = $15
Hour 1 charge:  $20 + $15                  = $35
6

Hour 2 — Usage below commitment, true-up kicks in (6 GPU-hours)

Shortfall qty:  10 − 6 = 4 GPU-hours
Usage cost:     6 GPU-hours × $2  = $12
True-up fee:    4 GPU-hours × $2  = $8
Hour 2 charge:  $12 + $8          = $20
7

Hour 3 — Usage matches commitment exactly (10 GPU-hours)

Usage cost:     10 GPU-hours × $2 = $20
Hour 3 charge:                    = $20
8

Billing period total

Total:  $35 + $20 + $20 = $75
Reservation discount applies per-charge commitment and overage. For a single minimum spend across the entire subscription, see Commitment.