Specifically, we are used to paying around $0.24/hour for most of our spot instances, but the standard cost of on-demand instances for m1.xlarge instances is $0.68/hourA good strategy might be to use a reserved instance. For a 3 year term, an upfront payment of $2800 would let them pay $0.24 per hour. $2800 works out to $0.10 per hour more, for a total cost of $0.34 per hour (exactly half the on-demand price).
They apparently do enough capacity planning to know approximately how many servers they need, and they could get slightly below this number in reserved instances, and fill the rest with on-demand instances. Spot instances could also be worked into this mix in lower numbers.
