Are you looking for the cheapest cloud computing available? Depending on your current situation, there are a few ways you might find the least expensive cloud offering that fits your needs.
If you don’t currently use the public cloud, or if you’re willing to have infrastructure in multiple clouds, you’re probably looking for the cheapest cloud provider. If you have existing infrastructure, there are a few approaches you can take to minimize costs and ensure they don’t spiral out of control.
Find the Cloud Provider that Offers the Cheapest Cloud Computing for Your Needs
There are a variety of small cloud providers that attempt to compete by dropping their prices. If you work for a small business and prefer a no-frills experience, perhaps one of these is right for you.
However, there’s a reason that the “big three” cloud providers – Amazon Web Services (AWS), Microsoft Azure, and Google Cloud – dominate the market. They offer a wide range of product lines, and are continually innovating. They have a low frequency of outages, and their scale requires a straightforward onboarding process and plenty of documentation.
Whatever provider you decide on, ensure that you’ll have access to all the services you need – is there a computing product, storage, databases? If you want to use containers or have the option for serverless, how do those products fit in? How good is the customer support? Does your company directly compete with the provider – for example, with Amazon’s retail arm? (You may not care, but some companies definitely do.)
While there is no one “cheapest” cloud provider among the major options, you should still compare to ensure you’re getting the best cloud prices for the services you’ll use most. For more information about the three major providers’ pricing, please see the following cloud computing cost comparisons:
A note on the idea of vendor lock-in: if you are already purchasing cloud services from a cloud service provider, you may be worried that you’re “locked in” to that provider. What we see in practice is a little different: with on-demand flexibility and more opportunity than ever to practice multi-cloud, companies shouldn’t really worry about vendor lock-in when it comes to public cloud.
How to Get the Cheapest Cloud Computing from Your Current Provider
Of course, whether or not you’re concerned about vendor lock-in, you should ensure that you’re getting the most efficient cloud computing cost available to you. That means optimizing your options for the products you use most.
Here’s a brief rundown of things you should do to ensure you’re getting the cheapest cloud computing possible from your current provider.
Use Reserved Instances for Production Environments
All of the major cloud providers offer a pricing option for Reserved Instances – that is, if you commit to use capacity over time, you can pay a discounted price. Reserved instances can save money – as long as you use them the right way. It’s important to focus on workloads with 24×7 demand – i.e., production workloads – for Reserved Instances. You will get the best price for the longest commitment. Of course, each cloud provider structures this option differently. Here are our guides to each:
Only Pay for What You Actually Need
There are a few common ways that users inadvertently waste money and throw away the option for the cheapest public cloud bill, such as using larger instances than they need, and running development/testing instances 24/7 rather than only when they’re needed. To pay for what you need, ensure that all of your instances are “rightsized” to the size that best matches the workload. You should also use on/off schedules so your non-production resources used for development, testing, and staging are turned off nights and weekends.
ParkMyCloud makes it easy to automated both of those things and reduce wasted cloud spend – try it out.
Take Advantage of Other Discounted Pricing Options
There are a number of other discounted pricing and purchasing options offered by the major cloud providers to help you get the cheapest cloud services.
- AWS Spot Instances – the best way to get the cheapest EC2 instance. This option offers heavy discounts for excess infrastructure, which can be reclaimed for other workloads at any time.
- Azure Low Priority VMs – similar to AWS’s spot instances, although there is a fixed discount for Azure’s offering, and a few other operational differences.
- Google Cloud Preemptible VMs – Google Cloud’s preemptible VMs are another similar option.
- Google Cloud Sustained Use Discounts – this is a built-in pricing mechanism for Google users that discounts pricing the more you run each server.
- Azure Dev/Test Pricing – a discounting option specifically for workloads used for development and testing.
It never hurts to contact your provider and ask if there’s anything you could be doing to get a cheaper price. If you use Microsoft Azure, you may want to sign up for an Enterprise License Agreement, or if you’re on AWS, ask your rep about the Enterprise Discount Program. Or maybe you qualify for AWS startup credits.
Get Credit for Your Efforts
While finding the cheapest cloud computing is, of course, beneficial to your organization’s common good, there’s no need to let your work in spending reduction go unnoticed. Make sure that you track your organization’s spending and show your team where you are reducing spend.
ParkMyCloud users have a straightforward way to do this. You can not only create and customize reports of your cloud spending and savings, but you can also schedule these reports to be emailed out. Users are already putting this to work by having savings reports automatically emailed to their bosses and department heads, to ensure that leadership is aware of the cost savings gained… and so users can get credit for their efforts.
Azure Reserved Instances are a way to reduce Azure costs by committing to a one- or three-year term for a virtual machine, in exchange for a discount of up to 72% compared to pay-as-you-go. Of course, before you lock in such a commitment, there are a few things you should know about this purchasing option – here are 10.
1. Azure Reserved Instances are a purchasing option.
First, you should understand that what you’re “reserving” is the pricing and purchasing option – the virtual machines are the same that you can pay for through pay-as-you-go pricing. (If this seems counterintuitive to the idea of “that virtual machine I reserved,” recall that a reservation works more like a credit against your bill in retrospect rather than a specific VM with your name on it.)
2. Reservations are “use it or lose it”.
Important: reservation discounts are “use it or lose it”. If no resources match your reservation for any hour, you lose the reservation for that hour. This is why you should always ensure that you have predictable, full-time usage planned before reserving capacity.
3. They’re not available for everything… but perhaps more than you’d guess.
Reservations are available for virtual machines, SQL database compute capacity, Azure Cosmos DB throughput.
Keep in mind what services are covered by your reservation:
- Reserved Virtual Machine Instance – the reservation covers compute costs, but not software, networking, or storage costs.
- Azure Cosmos DB reserved capacity – reservations are for the provisioned throughput – not storage or networking charges.
- SQL Database reserved vCore – the reservation covers the compute costs, but not licenses.
- SQL Data Warehouse – reservations cover “compute Data Warehouse Units” (cDWU), or units of CPU, memory, and IO – but not storage or networking charges.
- App Service stamp fee – reservations cover stamp usage, but not workers and therefore other resources associated with the stamp.
There are some limitations to availability. You cannot purchase reservations for A-series, Av2-series, or G-series VMs; any VM-series or size in preview; Germany or China regions; or in some cases, reservations may be limited due to low capacity in a region.
4. You need to set a “scope” for the Reserved Instance to apply.
Another concept to be familiar with is the concept of “scope” for reservations – in other words, what subscription or resource groups are eligible for the discount you are purchasing. Scope can be limited to a single resource group, a single subscription, or shared scope across multiple eligible subscriptions as long as billing is tied together.
5. Instance sizes are flexible, automatically.
When you purchase Azure Reserved Instances, there is an option to “optimize for instance size flexibility” that will be selected by default. This means the reservation can apply to the VM sizes in the same VM group, which makes each reservation a bit more broadly applicable.
6. Whether you pay upfront or monthly, the cost is the same.
Payment options: Azure just released in September 2019 the ability to pay for reservations through monthly payments – at the same cost that you would pay up front, with no extra fees. There is no “partial upfront” option. This is in contrast to, say, AWS’s Reserved Instance options, which have a variable discount depending on how much you pay upfront. The difference in approach may vary due to the cancellation options – AWS users can resell unused capacity on the Reserved Instance marketplace, while Azure users pay a cancellation fee. Google Cloud offers only a billed-monthly option – with no option to cancel.
7. Azure recommends Reserved Instances based on your usage history.
Reservation Recommendations and quantity are shown when you purchase a VM reserved instance in the Azure portal, based on the last 30 days of usage and your savings potential. You can see recommendations in Azure Advisor, at least, for individual subscriptions. For shared scope, you can use the API to get purchase recommendations.
8. Azure Reserved Instance purchases are used immediately, and don’t renew.
There are two important things to understand regarding terms and renewal. First, the term for your reservation starts immediately: you can’t schedule them for a future date. Second, Azure Reserved Instances do not automatically renew, and when the billing term expires, you’ll pay the pay-as-you-go rate. (We’ll be blogging next week on an option AWS has recently released to queue new reservations in advance.)
9. There are two solid options if you no longer need a reservation you already purchased.
What happens if you determine that you no longer need an Azure Reserved Instance you’ve purchased? There are two main options:
Exchange – you can exchange a reservation for another of the same type– that is, you can’t return a VM reservation to purchase an SQL reservation. This is only allowed if the total lifetime cost of the new purchase is greater than the leftover payments that are canceled for the returned reservation.
Cancel – instead, you can choose to cancel the reservation contract and request a refund. However, you are subject to an early termination fee of 12%. Note also that there’s a total refund limit of $50,000 in a rolling 12-month window.
10. Azure Reserved Instances make sense… in some situations.
For predictable production workloads, where you know you’ll have VMs running 24×7, Azure Reserved Instances can make sense. However, for your non-production workloads, this is likely not the case. You’ll save far more by using pay-as-you-go pricing, and scheduling those VMs to turn off when they’re not needed (ParkMyCloud can help with that.)
How much do the differences between cloud providers actually matter?
How to save money with Microsoft Azure Enterprise Agreements
Can Azure Dev/Test pricing save you money?
The ParkMyCloud team is looking forward to attending our first Microsoft Ignite conference this year! The sold-out event, which will take place November 4-8 in Orlando, is a gathering of more than 25,000 Microsoft users focused on building solutions and managing infrastructures. Here are three things to look forward to at the conference.
As with other tech conferences, Microsoft will make plenty of product and service announcements at Ignite 2019. At the 2018 conference, more than 150 announcements covered product and roadmap highlights across AI/Machine Learning, Analytics, Blockchain, Compute, Containers, Databases, Developer Tools, DevOps, Identity, Integration, IoT, Management and Governance, Microsoft Azure Stack, Migration, Mobile, Networking, Security, Storage, Web, and Windows Virtual Desktop.
Highlights from last year include doing away with passwords using Microsoft Azure Active Directory, Surface Hub 2 whiteboards, Microsoft Teams updates, Azure Digital Twins, and more – so we’re sure 2019 will have some exciting releases in store.
2. Speakers & Sessions
Featured speakers at the event include leaders from throughout Microsoft – but it doesn’t stop there. There are currently 1445 sessions on the calendar – more than 500 of which are on Azure. Typically when confronted with this volume of options, we recommend that you pick 1-2 goals of things you would like to learn or questions you would like to get answered for your business, and look for relevant sessions from there. Many sessions will be recorded and posted online, so keep that in mind if you are interested in sessions at conflicting times – you can always come back to them.
That said, here are a few sessions we thought looked particularly interesting:
- THR1004 – A real-world smart city: How Richmond VA is transforming citizen services
- WRK 3017 – Accelerating natural language processing development with Azure Machine Learning
- UNC1010 – Achieving zero downtime deployments with Azure DevOps and Kubernetes
- BRK3181 – Advanced monitoring: Five Azure Monitor best practices you should know
- BRK3190 – Analyze, manage, and optimize your cloud cost with Azure Cost Management
- BRK1074 – Announcing Bing Maps Geospatial Analytics Platform Preview for Enterprise Business Planning
- BRK3062 – API management for microservices in a hybrid and multi-cloud world
- BRK2021 – Architecting and implementing governance across your Azure subscriptions
- THR2186 – Azure Databricks and Azure Machine Learning better together
Check out also the 140 (!) podcasts that will broadcast live during the event.
Of course, part of the conference experience is the fun surrounding all the sessions. Be sure to spend some time in the expo hall to meet vendors, see product demos, get swag, and enter drawings for the chance to win cool prizes.
Don’t miss Thursday evening after party – this year, it’s at Universal Studios Florida and Universal’s Island of Adventure, which means you can explore Hogsmeade and more with access to the parks and rides, food and drink, and more.
See You at Microsoft Ignite 2019
We hope to see you at the event! We’ll be joining our parent company Turbonomic at booth #1713 in the expo hall. Schedule a time to stop by – we’d love to chat cost optimization for Azure and hear what you think of the event.
As more large enterprises adopt Azure cloud, especially those that have traditionally used Microsoft tools, we have observed growing interested in Microsoft Azure Enterprise Agreements, commonly known as EAs. We thought it would be useful to understand more about Microsoft EA’s, how they work with Azure, and what they mean to both the enterprise and the ISV.
What is an Azure Enterprise Agreement?
While you can create an Enterprise Agreement with Microsoft specifically for Azure, most companies using this option already have an EA in place for use of their software assets like Windows, Office, Sharepoint, System Center, etc. If you have an EA for other products, then you can simply add Azure to that existing agreement by making an upfront monetary commitment. You can then use eligible Azure cloud services throughout the year to meet the commitment. And you can pay for additional usage beyond the commitment, at the same rates. So, like any Enterprise License Agreement (ELA), including AWS’s EDP, you are committing to a contract term and volume to gain additional discounts.
According to Microsoft, the Enterprise Agreement is designed for organizations that want to license software and cloud services for a minimum three-year period. The Enterprise Agreement offers built-in savings ranging from 15 percent to 45 percent based on committed spend – and given how these commitments typically work, it is likely that the more you buy, the better your discount. The minimum listed commitment for an EA is 500 more users or devices for commercial companies (250 for public sector), and they specifically state this minimum does not apply to Server and Cloud Enrollment, an offering aimed at companies with EAs in place to help them standardize on Microsoft server and cloud technologies.
As it turns out, the Azure Enterprise commitment minimum is very low. You are required to make an upfront monetary commitment for each of the three years of the agreement, with a minimum order value of one “Monetary Commitment SKU” of $100 per month ($1,200/year). This low commitment make sense: once an enterprise is on a cloud platform, it’s sticky – land and expand is the name of the game for Azure, AWS, and Google. They expect infrastructure to grow significantly beyond the minimum, and just need to get a foot in the door. And of course,the starting point on the cloud is supposed to be much cheaper and flexible than on prem infrastructure.
Benefits of an Azure Enterprise Agreement… Beyond Pricing
There are certain Azure-specific EA benefits besides just price to entice users to move off of Pay-As-You-Go. You can create and manage multiple Azure subscriptions with a single EA. You can also roll up and manage all your subscriptions, giving you an enterprise view of how many resource minutes you’re using per subscription. In addition, you can assign subscription burn to accounting departments and cost centers so you can more easily manage budgets and see spend at various roll up levels.
EAs give you access to certain features that you’d otherwise be required to purchase separately. For example, an Azure EA gives you the option to purchase Azure Active Directory Premium, which will give you access to multi-factor authentication, 99.99% guaranteed uptime, and other features. Pay-As-You-Go only gives you access to the free version of Azure AD.
Besides getting the best pricing and discounts, what are some of the other added benefit an EA might provide to an enterprise:.
- A common IT platform deployed across the organization.
- Minimal up-front costs and the ability to budget more effectively by locking in pricing and spreading payments over three years.
- Flexibility to choose from Microsoft cloud services, on-premises software, or a mix of both and migrate on your own terms.
- Simplified purchasing with predictable payments through a single agreement for cloud services and software.
- Managed licensing throughout the life of your agreement with the help of a Microsoft Certified Partner or a Microsoft representative.
Now, for vendors like ParkMyCloud, that need Azure pricing data to perform our service, how are we affected by the EA? Not adversely: the good news is that Microsoft makes EA pricing available through dedicated APIs and/or the Azure Price Sheet. We can match this information to a customer by using their Offer ID which defines their EA subscription and corresponding pricing (discounts).
How Else Can You Save Money on Azure?
Whether an Azure Enterprise Agreement makes sense for your organization is up to you to decide. Luckily, it’s not the only way to keep Azure costs in check. Here are a few others to explore:
Azure Dev/Test pricing is an option that Azure offers to give developers access to the tools that are necessary to support ongoing development and testing in Microsoft Azure services. This, hopefully, should give the user more control of their applications and environments reducing waste.
Azure Dev/Test Pricing Options
With Azure Dev/Test pricing, three different options are available to users – Individual, Teams (Enterprise Agreement Customers), and another Teams option for those customers that don’t fall under the enterprise agreement. These pricing options are offered solely to active Visual Studio subscribers. We’ll dig in a little deeper to the pricing options and the benefits associated with each one.
Option 1: Individuals
The individual option is meant to let users explore and get familiar with Azure’s services. As you can imagine, pricing for individuals is a little different than team pricing. Individuals are given the pricing option of monthly Azure credits for those who are subscribed to Visual Studio. If this pricing option is chosen, the individual is given a separate Azure subscription with a monthly credit balance ranging from $50-150.
You get to decide how you use your monthly credit. There are several Azure services that you can put the credit towards. The software included in your Visual Studio subscription can be used on Azure VMs for no additional charges, you pay a reduced rate for the VMs that you run.
These monthly credits are ideal for personal workloads, but other options are more optimal for team workloads.
Option 2: Teams – Enterprise Agreement Customers
Teams that have an Enterprise Agreement in place have access to low Dev/Test rates for multiple subscriptions. The funds that are on the customer’s Enterprise Agreement will be used – there is no separate payment. A discount is given to customers at this level – all Windows and Windows Server, Virtual Machines, Cloud Services, and more are discounted off normal Enterprise Agreement rates.
Unlike the option for Individuals, the team’s option for enterprise agreement customers allow end-users to access the application to provide feedback and to run tests – only Visual Studio subscribers can actually use the Azure resources running in this subscription.
Option 3: Teams – All Other Customers
If a user isn’t an enterprise agreement customer but wants to use Azure for their teams, they would fall under this category. This rate offers a pay-as-you-go Dev/Test pricing option. This pricing option is very appealing because it allows users to quickly get their teams up and running with dev/test environments. Users are only allowed to use these environments for development and testing.
This is a more flexible and inclusive option, it allows for multiple team members to interact with the resources, it’s not limited to just the account owners.
Can Azure Dev/Test Save You Money?
All three options allow users to use the software that is included in their Visual Studio subscription for dev/testing. For VMs being run in environments in all three of these options, users are given a discounted price that is based on a Linux VM rate.
Microsoft Azure users that are looking to save money on their cloud costs may want to use one of these options. These pricing options come with the benefit of no additional Microsoft software charges on Azure Virtual Machines and exclusive dev/test rates on other Azure services.
Users looking to save money on public cloud may be in the market for a start/stop VM solution. While it sounds simple, there is huge savings potential available simply by stopping VMs, typically on a schedule. The basic idea is that non-production instances don’t need to run 24×7, so by turning VMs off when they’re not needed, you can save money.
If you use Microsoft Azure, perhaps you’ve seen the Start/Stop VM solution in the Azure Marketplace. You may want this tool if you want to configure Azure to start/stop VMs for the weekend or on weekday nights. It may also serve as a way to avoid creating a stop VM powershell.
Users of Azure have taken advantage of this option to start/stop VMs during off-hours, but have found that it is lacking some key functionality that they require for their business. Let’s take a look at what this Start/Stop tool offers and what it lacks, then compare it to ParkMyCloud’s comprehensive offering.
Azure Start/Stop VM Solution
Let’s take a look at Azure’s start/stop VM solution. The crux of this solution is the use of a few Azure services, specifically Automation and Log Analytics to schedule the VMs and Azure Monitor emails to let you know when a system was shut down or started. Both scheduling and keeping track of said schedules are important.
As far as the backbone of Azure services, the use of native tools within Azure can be useful if you’re already baked into the Azure ecosystem, but can be prohibitive to exploring other cloud options. You may only use Azure at the moment, but having the flexibility to use other public clouds in the future is a strong reason to use cloud-agnostic tools today.
Next, this solution costs money, but it’s not very easy to estimate the cost (but does that surprise you?). The total cost is based on the underlying services (Automation, Log Analytics, and Azure Monitor), which means it could be very cheap or very expensive depending on what else you use and how often you’re scheduling resources.
The schedules themselves can be based on time, but only for a single start and stop time – which is not practical for typical applications. The page claims it can be based on utilization, but in the initial setup there is no place to configure that. It also needs to be set up for 4 hours before it can show you any log or monitoring information.
The interface for setting up schedules and automation is not very user-friendly. It requires creating automation scripts that are either for stopping or starting only, and only have one time attached. This is tedious, and the single-time configuration makes it difficult to maximize off time and therefore savings.
To create new schedules, you have to create new scripts, which makes the interface confusing for those who aren’t used to the Azure portal. At the end of the setup, you’ll have at least a dozen new objects in your Azure subscription, which only grows if you have any significant number of VMs.
Users have noted numerous complaints in the solution’s reviews:
“Great idea – painful to use – I don’t know why it couldn’t work like the auto shutdown built into the VM config with maybe a few more options (on/off weekdays vs. weekends). Feels like a painful set of scripts with no config options once it’s deployed (or I don’t understand how to use it).”
“Tried to boil the ocean – This solution is complex and bloated. It still supports classic VMs. The autostop solution only supports stop not start. Why bother using this?”
“Start/Stop VM Azure – Difficult to do and harder to modify/change components. I’ll have difficulty to repeat to create another schedule for different VM.”
Luckily, there’s an easier option.
How it stacks up to ParkMyCloud
So if the Start/Stop VM Solution from Microsoft can start and stop Azure VMs, what more do you need? Well, we at ParkMyCloud have heard from customers (ranging from day-1 startups to Fortune 100 companies) that there are features necessary for a cloud cost optimization tool if it is going to get widespread adoption.
That’s why we created ParkMyCloud: to provide simple, straightforward cost optimization that provides rapid ROI while being easy to use. You can use ParkMyCloud to save money through Azure start/stop VM schedules for non-production resources that are not needed evenings and weekends, as well as RightSizing overprovisioned resources.
Here are some of the features ParkMyCloud has that are missing from the Microsoft tool:
- Single Pane of Glass – ParkMyCloud can work with multiple clouds, multiple accounts within each cloud, and multiple regions within each account, all in one easy-to-use interface.
- Easy to change or override schedules – Users can change schedules or temporarily override them through the UI, our API, our Slackbot, or through our iOS app.
- Schedule recommendations – the Azure tool requires users to determine their own schedules. ParkMyClouds recommends on/off schedules based on keywords found in tags and names, and based on resource utilization history.
- Policy engine – ParkMyCloud can assign schedules automatically based on rules you create based on teams, names, or other criteria.
- RightSizing – in addition to on/off schedules, you can also save money with RightSizing. Our data shows that more than 95% of VMs are operating at less than 50% average CPU, which means they are oversized and wasting money. Changing the VM size or family, or modernizing instance types, saves 50-75% of the cost of the instance.
- User Management – Admins can delegate access to users and assign Team Leads to manage sub-groups within the organization, providing user governance over schedules and VMs. Admin, Team Lead, and Team Member roles are able to be modified to fit your organization’s needs.
- No Azure-specific knowledge needed – Users don’t need to know details about setting up Automation Scripts or Log Analytics to get their servers up and running. Many ParkMyCloud administrators provide access to users throughout their organizations via the ParkMyCloud RBAC. This is useful for users who may need to, say, start and stop a demo environment on demand, but who do not have the knowledge necessary to do this through the Azure console.
- Enterprise features – Single sign-on, savings reports, notifications straight to your email or chat group, and full support access helps your large organization save money quickly.
- Integrations – use ParkMyCloud with your favorite SSO tools such as Ping and Okta. Get notifications and send commands back to ParkMyCloud through tools like Slack and Microsoft Teams.
- Straightforward setup – it usually takes new users 15 minutes or less to set up a ParkMyCloud account, connect to Azure, and get started saving money.
- Reporting – with ParkMyCloud, users can view, download, and email savings reports covering costs, actions, and savings by team, credential, provider, resource, and more.
- Notifications – users can get configurable notifications of ParkMyCloud updates & activities via email, webhook or ChatOps.
- Huge cost savings and ROI – here are just a few examples from some of our customers.
- A global fast food chain is managing 3,500+ resources in ParkMyCloud and saving more than $200,000 per month on their cloud spend
- A global registry software company has saved more than $2.2 million on their cloud spend since signing up for ParkMyCloud – an ROI of 6173%
- A global consumer goods company with 200+ ParkMyCloud users saves more than $100,000 per month on their cloud spend.
As you can tell, the Start/Stop VM solution from Microsoft can be useful for very specific cases, but most customers will find it lacking the features they really need to make cloud cost savings a priority. ParkMyCloud offers these features at a low cost, so try out the free trial now to see how quickly you can cut your Azure cloud bill.