# How Does Archera Calculate Commitment Coverage

## Does Archera define commitment coverage differently from AWS?

Yes — Archera defines commitment coverage a bit differently from AWS to make the evaluation process for Commitment Strategies as intuitive as possible.

## The Difference

**AWS, Azure and Google Cloud** define Commitment coverage as the total number of On-demand Running Hours being covered by Commitments.

**Archera** defines Commitment coverage as the total On-demand Spend in $ being covered by Commitments.

This makes it more clear to customers what costs are being committed to, instead of resource hours that can be billed at wildly different rates.

## Example Scenario

Imagine you are running:

* A t3 (cheap compute VM) — $5 per day
* A p4 (expensive GPU VM) — $770 per day
* **Total:** $775 per day with 0% coverage

If you buy a commitment for the t3:

**According to AWS:** You increase coverage to 50% but are still paying $772 a day on-demand.

**According to Archera:** You increase coverage to only 1% since the majority of your $772 a day spend is on-demand.

## Why This Matters

The Archera approach gives a consistent metric to compare between Commitment strategies and also helps avoid strange cases where plans with much lower coverage yield far higher savings compared to plans covering many more cheaper machines.

## Related Resources

* [Commitment Planner - Overview](https://docs.archera.ai/help-center/user-guide/commitment-planner)
* [How to Create a Custom Purchase or Renewal Plan](https://docs.archera.ai/help-center/user-guide/how-to-create-custom-plan)