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AWS and Azure: SLAs and Service Credits

The cloud SLA is a policy governing service level objectives by the cloud service providers.

Different types of cloud SLAs are: IaaS SLAs (with a distinction between compute and storage services), PaaS SLAs, and SaaS SLAs.

In general, service level objectives vary across service models.

Two main remedies in case of breach of the SLA are the accruing of service credits and the payment of penalties. The first consists of a reduction of the amount of charges to be paid; the second one relates to the amount to be paid by the provider. Both AWS and Azure cloud service providers always go with the first option of giving “service credits” in case of breaches in their in SLAs.

The “Service Credit” is the percentage of the applicable monthly service fees credited to customers following claim approval. Credits are the sole form of compensation for missed service commitments across all the SLAs that were reviewed, regardless of the service models. The calculation of service credits differs significantly from provider to provider.


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