Wednesday, April 23, 2014

Microsoft Azure: Reducing Cost

If you plan to use IaaS make sure you have a sound monitoring strategy that you have reporting on the load and performance of your Virtual Machines.


As the above graph shows that the virtual machine is not used during the last 7 days. This is a very good candidate to look a little bit deeper into. After doing some root cause analysis it is a standard small vm running linux costing your company around € 33.25 / a month. If we would scale down this application from Standard to Basic we would save € 5.54 / month which would be a cost reduction of ~17%. Since it seems that this virtual machine is underutilized for most of the time (CPU anyways) we could scale it down from S to XS bring down the cost even further from € 27.71 to € 9.98 which would save us an additional 64 %. Doing this it would mean that we would bring down out monthly cost from €33.25 to € 9.98 saving us 70%.
If we would take it a step further we could investigate the type of application that is running on this serer and maybe migrate it to a PaaS solution bringing the cost even further down. In this case the VM was running a very simple website hosting this in a shared website we could even bring the cost further down to € 7.21 which would our bring our total savings to 92%.

The cloud is not only about up scaling it is all about optimizing cost! This means that if needed you can scale up and or out but it means you can scale down and in as well saving your company money. This is a very very simple example. But if you would closely analyze usage and optimize your scaling strategy, the potential cost savings can be quite significant. This was a case which I came across in my company, the figures are representative and taken from the Microsoft pricing calculator which can be found at:, not taken into account any EA reductions.