3.3.8 Contract Commitment Discount Percentage

Contract Commitment Discount Percentage represents the effective percentage reduction applied to the list price for resources or services covered by a contract commitment.

ContractCommitmentDiscountPercentage MUST adhere to the following requirements:

• ContractCommitmentDiscountPercentage MUST be of type Decimal.
• ContractCommitmentDiscountPercentage MUST conform to NumericFormat requirements.
• ContractCommitmentDiscountPercentage MUST adhere to the following nullability requirements:
  • ContractCommitmentDiscountPercentage MUST NOT be null when ContractCommitmentBenefitCategory is "Discount".
  • ContractCommitmentDiscountPercentage MUST be null when ContractCommitmentBenefitCategory is "Availability".
• ContractCommitmentDiscountPercentage MUST be a value between 0.0 and 1.0, inclusive.
• For contracts with multiple tiers (e.g., 5% discount up to 1M, 10% above 1M), ContractCommitmentDiscountPercentage MUST adhere to the following additional requirements:
  • ContractCommitmentDiscountPercentage MUST reflect the discount percentage defined for the specific pricing tier represented by the Contract Commitment row.
  • ContractCommitmentDiscountPercentage MUST correspond to only one pricing tier per Contract Commitment row.
• ContractCommitmentDiscountPercentage SHOULD represent the net effective discount when multiple contractual layers are applicable (e.g., a negotiated discount on top of a standard commitment).

3.3.8.2.1 Calculating the Effective Percentage

In scenarios where a commitment has "stacked" or "nested" discounts, this field should reflect the total reduction from the list price.

Discount Percentage = 1 - (Contracted Unit Price / List Unit Price)

For example, consider usage that yields a cost for which the following discounts are applicable:

• Commitment discount: 20% applied to the on-demand cost
• Negotiated discount: 10% applied to the post-commitment discount cost

The effective discount is not 30%. It is: 1 - (0.8 × 0.9) = 28%

In this scenario, ContractCommitmentDiscountPercentage should be reported as 28%.

3.3.8.2.2 Relationship to Benefit Category

This field provides the magnitude for the Discount category. While ContractCommitmentCost tracks the financial obligation (what you pay), ContractCommitmentDiscountPercentage tracks the benefit rate (what you save).

3.3.8.2.3 Tiered Incentives

For commitments with multiple tiers (e.g., 5% discount up to 1M, 10% above 1M), this column should represent the active or base discount percentage applicable to the current contract row.

The effective percentage reduction applied to the list price of resources or services covered by a contract commitment.