Canary releases are releases where we have the current version of the application service and the new version installed on the system in parallel. As such, they resemble blue-green deployments. At first, all traffic is still routed through the current version. We then configure a router so that it funnels a small percentage, say 1%, of the overall traffic to the new version of the application service. The behavior of the new service is then monitored closely to find out whether or not it works as expected. If all the criteria for success are met, then the router is configured to funnel more traffic, say 5% this time, through the new service. Again, the behavior of the new service is closely monitored and, if it is successful, more and more traffic is routed to it until we reach 100%. Once all traffic is routed to the new service and it has been stable for some time, the old version of the service can be decommissioned.
Why do we call this a canary release? It is named after the coal miners who would use canary birds as an early warning system in the mines. Canary birds are particularly sensitive to toxic gas and if such a canary bird died, the miners knew they had to abandon the mine immediately.