Managing Azure Costs
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In this course, you’ll learn how to forecast Azure costs, choose the right subscription and purchasing options, track spending, and use cost reduction strategies.
- Use the Total Cost of Ownership Calculator to determine cost savings from migrating to Azure
- Understand Azure subscription and purchasing options
- Use the Pricing Calculator to forecast Azure service costs
- Apply Azure cost reduction strategies
- Create budgets and analyze spending using Azure Cost Management
- Anyone who needs to manage costs on Azure
- People preparing to take either the Azure Fundamentals or Azure Solutions Architect exam
- Basic knowledge of Azure (or take our Overview of Azure Services course)
Before you can use Azure, you need to have a subscription. It’s used by Microsoft for billing purposes. Whenever you create a resource in Azure, it will be assigned to a subscription, so Microsoft will know how to bill for that resource. It’s possible to have multiple subscriptions, but each Azure resource can only be assigned to one subscription.
There’s actually one other element that’s needed before Microsoft can charge you, and that’s a billing account. It contains the payment details, such as your credit card information. Every subscription needs to be linked to one (and only one) billing account, so Microsoft will know how you’ll be paying for the subscription. But it is possible to link multiple subscriptions to one billing account. That’s because you could use the same payment method for multiple subscriptions. Why would you want to do that? Well, you could use subscriptions to organize your resources. For example, you could have a separate subscription for each department in your organization so you could track each department’s costs.
The person who creates an Azure subscription becomes the global administrator for it and has full access to every aspect of that subscription.
There are three main types of subscriptions available: free, pay-as-you-go, and member offers. The free trial subscription lets you use a limited amount of certain Azure services for free every month. It also gives you a $200 credit that you can use on most of the Azure services that aren’t on the list of free services or for more than the monthly allotment of the free services. You can only use this $200 credit for up to 30 days. After that, you need to upgrade to a pay-as-you-go subscription to keep using the free services. Twelve months after the start of the trial, you’ll no longer get the monthly allotment of free services.
When you create a free trial subscription, it also creates a billing account, so you have to enter credit card or debit card information, even though Microsoft won’t charge you until you upgrade the subscription to pay-as-you-go. Microsoft only allows one free trial per customer.
The pay-as-you-go subscription, as you can tell from the name, lets you pay for the Azure resources as you use them. That is, you don’t have to sign a long-term contract. You pay for what you use on a monthly basis, and you can cancel at any time. This is also known as consumption-based billing.
Microsoft has many types of member offers that give you reduced rates for Azure services if you’re a member of certain groups, such as MSDN Platform subscribers or Visual Studio subscribers. These types of subscriptions offer substantial discounts over a pay-as-you-go subscription, so it’s highly recommended that you take advantage of any offers you qualify for. You can find current offers at this URL.
There are three options for purchasing Azure subscriptions. The most straightforward one is called Web Direct. This is when you purchase directly through the Azure website.
Alternatively, if your organization plans to purchase a large amount of Microsoft products and services, then you can save money by signing an Enterprise Agreement with Microsoft. This is a negotiated agreement that comes with substantial discounts. In exchange for these discounts, you need to sign a long-term commitment, for a minimum of three years, to use a certain amount of Microsoft products and services. Enterprise agreements are typically billed on an annual basis.
If you need to run a custom third-party solution on Azure, then one option is to purchase through a Cloud Solution Provider, or CSP. This is a Microsoft partner that develops Azure-based solutions. A CSP will bill you for both Azure and its own solutions. It also provides you with technical support.
If you need to buy an off-the-shelf third-party solution that runs on Azure, then once you have an Azure subscription, you can go to the Azure Marketplace and purchase one. Many vendors, such as Oracle and Red Hat, offer virtual machine images that you can spin up immediately after buying them in the Marketplace.
And that’s it for subscriptions and purchasing options.
Guy launched his first training website in 1995 and he's been helping people learn IT technologies ever since. He has been a sysadmin, instructor, sales engineer, IT manager, and entrepreneur. In his most recent venture, he founded and led a cloud-based training infrastructure company that provided virtual labs for some of the largest software vendors in the world. Guy’s passion is making complex technology easy to understand. His activities outside of work have included riding an elephant and skydiving (although not at the same time).