Monday, May 27, 2024

Azure Pricing: How to Get the Best Deal

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Cloud computing fees are always complicated, but Microsoft Azure pricing is even more complex than most. The Azure cloud offers a huge array of services with a dizzying array of tiers, regions and instances available. In addition, Microsoft offers discounts on volume licensing for its largest customers, but the terms of those agreements are fairly opaque. As a result, Azure customers are paying a wide variety of different prices for the same services.

So how can organizations be sure that they are getting the best deal possible on Azure?

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Experts recommend several tips.

Start with the Calculator

On its Azure website, Microsoft offers a very helpful pricing calculator. It allows users to drag and drop various services and determine the standard pay-as-you-go price. The calculator stands out for having a user interface that’s very easy to use, and unlike some vendor calculators that serve more as marketing devices than cost estimation tools, it really does provide accurate advice.

Companies can use the calculator to try out different combinations of Azure services to find the arrangement that gives them the lowest overall costs. For example, they can see whether two smaller compute instances would be a better deal than one larger compute instance or if one storage service might be better than another.

Organizations can also use the calculator as a baseline for judging other discounts they might be able to obtain from Microsoft.

Include Azure Pricing in Your EA

Microsoft promises its “very best prices” to large customers who have an Enterprise Agreement (EA) with the company. In order to qualify, organizations need to have 500 or more users or devices (or 250 if they are a government agency). Businesses that already have an EA for Windows, Office or other Microsoft software can add Azure to their current agreement.

If companies qualify, the savings through an EA can be significant. According to Microsoft, they range from 15 percent to 45 percent. In addition, it locks in prices for three years, and puts organizations on a predictable payment schedule.

However, the EA program is very complicated. The program guide is a full 22 pages long, and it will require someone on staff to become very familiar with all the ins and outs of Microsoft pricing if organizations want to be sure that they are getting the best bang for their buck.

Consider Resellers

For organizations not large enough for an EA, buying Azure services through a reseller might offer a better deal than buying directly from Microsoft. Through its Cloud Solution Provider (CSP) and Open Licensing programs, Microsoft offers deep Azure discounts to resellers, who in turn pass some of those savings on to their customers.

Resellers may also offer other benefits like cloud management, support or cost optimization capabilities. These services can be very valuable, particularly for smaller organizations with limited IT staff. As a result, this has become a very popular option; Microsoft says that 35 percent of Azure business comes through its partners.

Sign Up for Free Programs

Microsoft has several special offers available on Azure. First, anyone can sign up for a free accountthat comes with $200 in Azure credit. That’s insignificant for a large enterprise, but it might be enough to run your small startup for a month.

In addition, several of Microsoft’s cloud computing services, like the App Service, Machine Learning, and Azure IoT Hub services, have free tiers. Again, these probably aren’t sufficient for a large company, but they might be helpful for a smaller organization.

Developers can also get some free Azure credit if they subscribe to Visual Studio. The credits range from $50 to $150 per month depending on which version of Visual Studio customers have and whether or not they are a member of the Microsoft Developer Network (MSDN).

Microsoft Partners can get some similar benefits through the Microsoft Action Pack (MAP) program. It includes access to a variety of Microsoft software plus $100 in Azure credits each month.

Finally, Microsoft also has some special Azure benefits for startups through its BizSpark program. To qualify, a company must be less than 5 years old, be privately held and earn less than a million dollars per year. According to Microsoft, the program can include up to $120,000 worth of free Azure credits over a three-year period.

Eliminate Waste in Azure Pricing

Once an organization has explored all the Azure pricing options and selected one, the job of ensuring that they are getting the best deal isn’t done.

Because of the cloud’s self-service provisioning capabilities, it’s really easy for developers to spin up a dev or test environment, use it briefly, and then forget about it. Meanwhile, the company is still being charged for that unused capacity. Shutting down unused instances—the cloud computing version of turning off the lights when you leave the room—can result in significant savings.

“Optimizing cloud usage can often save 30-45% of cloud spend, which can be as much or more as the discounts available through your Microsoft Enterprise Agreement,” said Kim Weins, vice president of marketing, RightScale.

Jeff DeVerter, Rackspace’s chief technologist for Microsoft technologies, echoes that sentiment, noting, “You should continuously pay attention to your infrastructure utilization to help ensure that you aren’t under/oversubscribed.”

Although some companies choose to do this cost optimization work on their own, others choose to invest in a third-party cloud management service or solution. “Especially now with the recently announced Azure price reductions, organizations should implement a cost optimization strategy which may also incorporate the use of a third party tool,” advised David Lucky, director of product management at Datapipe. “Through using a management framework and third party tools for tracking costs, organizations can analyze usage over time, allowing users to make recommendations which may include right sizing of VMs based on captured analytics.”

Pay Attention to Azure Price Drops

The major cloud computing vendors are engaged in an ongoing price war, which results in frequent price drops. Microsoft made its most recent Azure pricing change on October 1, lowering prices on some instances anywhere from 11 percent to 50 percent.

These sorts of price changes mean that those initial calculations organizations might have done with the Azure pricing calculator at the beginning of the process are no longer valid. In order to make sure that they are still getting the best deal, businesses will need to re-run the numbers to see if it make sense to switch to different types of instances.

“Changing server types will require a migration of your app and/or data – but saving 50 percent of the cloud server cost may be worth it!” noted DeVerter.

Again, using a third-party cost optimization tool may pay off if organizations can use it to locate those kinds of savings.

In short, getting the best deal on Azure pricing is not a one-time thing. Organizations will need to be constantly re-evaluating and optimizing their usage if they want to be sure that they are getting the best value for their cloud computing expenditures.

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