Azure Pricing: It can’t be that complicated, can it?

By Kenneth Berry, Partner Relationship Manager with Westcoast

Azure Pricing: It can’t be that complicated, can it?

As the majority of my peers in the industry would say: “It depends” and unfortunately that is the best and worse answer a potential client can get.

However, I see this as the reason why we are seeing more and more clients move some of their infrastructure to Azure, as it enables more flexibility and agility.

When a client makes an upfront purchase, they are “stuck” for a want of a better word, with that for the lifecycle of that infrastructure, and more often than not they spend the last few years of its life sweating the asset and worrying that it might decide one morning to head for server heaven.

Pricing Azure is very simple:  just ask what compute, storage and networking you need?

And don’t forget to include electricity costs, IT labour costs, maintenance fees, out-of-warranty fees, virtualisation costs and other service provider costs (cooling) etc. when comparing it to an on-premise server investment.

This is a common mistake a lot of partners or end users make.  They don’t calculate the actual total cost of their current infrastructure to make a fair comparison with Azure.

If you price like for like infrastructure you will find more often than not, that Azure is slightly more expensive.  Keep in mind though that with Azure you are renting space in a multi-million-euro secure data centre and you can never hope to replicate that environment in the privacy of your own comms room.

One of my colleagues states accurately that you can get compute services in Azure at a lower rate than it costs to power a server for 1 hour. Compute can cost as little as 11 cents per hour, a KW of power costs 13 cents upwards¹.

When you are looking at the actual cost of Azure, you need to include and work out all the costs associated with service provision.

From my point of view, Azure is an important consideration in any modern workplace strategy.  If you are simply migrating to Office 365 and using Azure for storage or using it for SAP Hana, what you should keep in mind are the practical benefits of Azure which are flexibility, capability, agility, security, disaster recovery and compliance.

1. Flexibility and scalability: we have heard this from the start, and these are the main drivers for adopting Azure, i.e. having the ability to add multiple VM’s or a VM monster for minutes or hours to complete a complex query
2. Agility: enable your business to test and develop new infrastructure/software offerings quickly and easily without the upfront capital costs
3. Security: Microsoft is the subject of ongoing security breach attempts but it’s one of the most advanced security companies in the world with an investment of approx. $1 billion in the security of its data centres
4. Disaster recovery: if you want disaster recovery quickly and easily, use Azure back up and site recovery through the portal
5. Compliance: with GDPR already upon us all, Microsoft have for the last year ensured that their offerings are GDPR-ready

But coming back to the issue of pricing for a moment, Microsoft also offer opportunities to make significant savings.  With Reserved Instances for compute, savings of up to 25% can be made if you are willing to commit to a 1 – 3-year term, in a particular data centre location and running a chosen VM. Using a hybrid benefit, these savings can increase to 80%.

A great way to quantify the cost/benefits for Azure is to complete the Azure TCO Calculator, which will enable you to input the costs associated with your current infrastructure and the tool will calculate your potential costs within Azure.

From there, you can use the Azure Migrate tool, which can help you discover, mitigate issues, view dependencies and adjust and optimise cloud resources based on utilisation of your on-premise infrastructure. Both of these tools are free* to use and in my experience you should be taking advantage of them.