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Reducing Costs

Updated Nov 16, 2020 ·
NOTES

This is not an exhaustive documentation of all the existing Azure Services. These are summarized notes for the Azure Certifications.

To see the complete documentation, please go to: Azure documentation

Overview​

Understanding the key factors that influence Azure costs is crucial for effective budgeting and cost management. Additionally, adopting cost-saving strategies can optimize expenses. Here are some significant factors and strategies related to Azure costs:

1. Region Selection​

  • The region where Azure resources are hosted impacts costs.

  • Some regions may have higher costs than others for the same services.

  • Consider cost differences when choosing a region, especially if data residency or latency is not a primary concern.

2. Data Transfer Costs​

  • Data transfer into Azure resources (ingress) is typically free.

  • Data transfer out of Azure resources (egress) may incur costs, especially if transferred across regions or outside the Azure network.

  • Minimize egress costs by keeping resources within the same region unless specific reasons justify cross-region deployment.

3. Resource Groups and Regions​

  • Resource group location is irrelevant for costs; the contained resources incur charges.

  • Placing resources in different regions within a resource group does not cause additional charges.

4. Reserved Capacity​

  • Reserved Instances involve committing to a long-term contract (1 or 3 years) for specific Azure services.

  • Offers potential cost savings (up to 72%) compared to pay-as-you-go pricing.

  • Available for select services, and the VM region is chosen during reservation.

  • Exchanging reservations is possible, but a new reservation must be made.

5. Azure Hybrid Benefit​

  • Utilize existing Windows Server or SQL Server licenses covered by Microsoft Software Assurance on Azure.

  • Applicable to Azure VMs, Azure SQL Database, or Azure SQL Managed Instance.

  • Helps reduce costs by leveraging existing licenses.

6. Azure Spot Virtual Machines​

  • Utilizing unused compute capacity, saves virtual machine costs.

  • Significant cost savings (up to 90%) but may be preempted with short notice (30 seconds).

  • Suitable for non-critical workloads like batch processing, testing, or rendering.

  • Ideal for workloads that can tolerate interruptions and don't require completion within a specific time frame.

7. Right-Sizing Virtual Machines​

  • Resize underutilized VMs to a more cost-effective option.

  • Azure Advisor provides insights into underutilized VMs and potential cost savings.

  • Consider downsizing or shutting down VMs based on usage patterns.

8. VM Deallocation and Resource Cleanup​

  • Stopped (deallocated) VMs may still incur charges for associated resources like data disks and static public IP addresses.

  • Deleting a VM might not remove all associated resources; clean up data disks and public IP addresses separately.

  • Azure Advisor assists in identifying unused resources, including public IP addresses.

Resources​