Azure Economics

1. Azure Economics

Let's explore the economics of using Azure.

2. Azure pricing

Regardless of the service you use, keeping an eye on costs is vital to ensure your spending is aligned with your budget, and with Azure, it’s no different.

3. Azure Free Account

When you first start working with Azure, several services are available at no cost for up to 12 months. This allows new users to familiarize themselves with Azure without an immediate financial commitment. Some resources from Azure are free forever, and others have a limitation on usage. When using a new Resource, it’s important to check the pricing information to ensure you can budget for the spending where needed.

4. Pay as you go

Azure operates on a pay-as-you-go pricing model, but it’s important to note that the responsibilities vary depending on the type of service and whether it falls under infrastructure as a service, platform as a service, and software as a service. Other options are available to reduce costs, which we’ll cover next. Using a pay-as-you-go model, you only use the resources you use without any upfront costs. This means you can scale resources up and down when needed for changing requirements without committing to large infrastructure changes - it allows organizations to optimize cost and scale with ease.

5. Reservations

Committing to one-year or three-year plans for Resources is one way to reduce costs significantly and guarantee availability. This can reduce costs by up to 72% from pay-as-you-go prices. A reservation is useful when you have consistent resource usage on a long-term project.

6. Reservations

Think of it like booking a hotel room in advance. You secure the space for a set period and often at a lower rate, ensuring it’s available when you arrive, rather than paying the premium rates or risking unavailability with on-the-spot demands.

7. Spot Instances

Spot instances are another way to reduce costs for any virtual machine usage. Using a Spot Instance means buying unused compute capacity at significant cost savings. These are a good option when you have workloads that can handle interruptions and don’t need to be completed within a specific time window.

8. Azure Hybrid Benefit

At an enterprise level, Azure offers hybrid benefits that enable organizations to reuse on-premise licenses, resulting in substantial savings. This allows you to use existing software licenses while avoiding new purchase costs and maximizes the existing investments. This enables easier migration by maintaining a familiar setup while offering cost incentives and operational consistency.

9. Planning costs in Azure

So, how do we plan for costs in Azure? Great question! We’ll look at the Pricing Calculator and Total Cost of Ownership Calculator before looking at the best practices for monitoring and optimizing costs.

10. Azure Pricing Calculator

The pricing calculator is a great tool for estimating the hourly or monthly cost of Azure before deploying resources when you specify your needs upfront. It provides customizable options for various Azure services to budget and prevent surprises later on down the line. You can simulate different scenarios with the calculator to help find the most cost-effective solutions. This lets businesses pinpoint major experiences and optimize cloud spending with transparent, detailed breakdowns.

11. Total Cost of Ownership

The total cost of ownership calculator focuses on looking at long-term value instead of upfront costs. This tool is useful for estimating cost savings realized by migrating to Azure. Aside from the financial outlook, looking at the operational benefits, reduced downtime risks, and scalability options is essential.

12. Azure Cost Management

When tracking your Azure spending, a centralized dashboard can be used to monitor and analyze costs. Within this dashboard, you can apply budget caps to safeguard spending and help optimize resources. Furthermore, you can do a granular analysis of costs by service and resource group, enabling you to pinpoint high-cost services or groups.

13. Cost Optimization

Having this spending data readily available means you can regularly review your costs and turn off underutilized resources to avoid waste. Azure Advisor is a tool that can help provide personalized recommendations to manage deployments efficiently based on your usage - offering insights on cost-efficiency and performance.

14. Let's practice!

Now, let's dive into some exercises and check what you have learned.

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