Azure pricing and cost management - Azure Tutorial

Now, let's dig a little bit into Azure Pricing and Cost Management. This is an area where people have a lot of interest, because one of the big value propositions of moving to the Cloud, is that you move from owning to consuming, and so you save a lot of money. But there are some things you've got to keep in mind. First of all, you pay for usage in the Cloud. Normally, you're not paying for something unless you're using it or it's allocated to you. That means that costs can scale with your demand. Remember, we talked about this, that scaling in both directions. As your demand increases, you can scale out to more, which costs you more, but then you can scale back in again when your usage demands aren't quite as high and that saves you money. The other thing that's great about the Cloud is that upgrades and maintenance are included. Like on-premises, if you wanted to upgrade all your machines, you'd have to buy all new machines. Or if something like a hard drive goes out, you'd have to buy a new hard drive. But in the Cloud, all that's included, and that shifts your cost burden from capital expenses that you would typically have on-premises, where you're having to buy all of this stuff up front. In the Cloud, you shift that more into an operational model, which allows you to have better predictability and more cost-efficient. Now, when we think about pricing in the Cloud, we have to understand that choices have impact. There are certain decisions you can make that can really impact how your cost breakout. The first thing you need to understand in Azure is, you need to understand meters. you need to understand how things are charged. So remember when we talked about blob storage, I said there are two costs associated with that. One is the cost of storage. The other is the cost of access. And think about virtual networks. When you create a virtual network, you don't pay for the virtual network itself, but you do pay for data that leaves that virtual network. And so once you have that understanding, you can plan accordingly. You can plan better for how you're utilizing virtual networks so that you can reduce as much as possible the amount of data that leaves a virtual network. The other thing that you have to keep in mind is that costs differ between different regions, even in the same country. You know, the cost that Microsoft incurs for electricity and all of the other things that it has to pay for in a data center, differs depending on which region of the country they're in, and so your costs will differ based upon which region you host in. Then there are different pricing models. For example, for SQL Server, Azure SQL Database, and Microsoft Virtual Machines, you can save money if you commit to a certain level of consumption in advance. Like you might say, we're going to have 50 VMs and we promise that we will have them for a period of a year, you get a price break for doing that. There are different price breaks that you can have based upon how you buy things. You might also go with a Cloud Solution Provider that's a third party that bundles up services into a total solution and might give you a cost break for that thing. These are the things you have to think about when you're making decisions about how you are consuming Cloud resources. Now, one of the things that can really help you with this in Azure is Azure Cost Management. This is an Azure service that is exposed to you in the Azure portal. It allows you to track your spending. It gives you pie charts and other information that shows you all of your spending, what types of resources you're spending on, how much each resource group is costing you, how much you're spending in different regions. You can also create budgets. So you can create forecast and budgets and see where your spending is based on those. If you want to, you can go a step further, and you can set spending limits. Now, the difference here is when you hit a spending limit, it stops your ability to use Azure resources. I'll give you an example. I have a Visual Studio Azure subscription. With that, I get $150 of Azure credit to use every month. Once I use that credit up, if I use any additional resources, I start getting charged on my credit card. I don't really want that to happen. What I've done is I've set a spending limit of $0 for my Azure subscription. I start out with negative 150 because I have a $150 credit. Once I reach that zero dollar mark, it shuts off my ability to use Azure resources, and that prevents me from having to spend any money. You can also set up alerts. Maybe you don't want to shut people off, but you'd like to be notified when spending hits a certain amount. So all of these features are available to you in Azure Cost Management. So let's talk about some tips that you can use to prevent overspending. Number one, consume what you spend. We've already kind of talked about this. Make sure that you utilize fully. This is so important in the cloud, which is why I've brought it up multiple times. Number two, start small. Don't create massively large deployments that cost a lot of money. Start small and scale up as you need to. Pay attention to resources that are always on because remember you're paying for consumption. So you may wanna make sure your virtual machines, for example, are configured so that they automatically stop and are deallocated if you're not using them. If something's always on, you're gonna get charged for it. and sometimes you might not notice that until you get your bill and your mind is blown because you have a very large cost associated there. Also, make sure you utilize these features in Azure Cost Management like budgets and limits. This can be a very powerful way for you to keep an eye on spending, take some action before you get to the point where things are out of control, and you can use that same method to review your costs. These are all things that are best practices to help you avoid overspending in the Cloud.