A Guide to Finally Understanding Azure VM Pricing


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The most common question new Azure users ask is, “How much does it cost?” and this blog will explore the various costs associated with running a virtual machine. The article then leads into an explanation of how important saving money on your infrastructure can be for enterprise-scale applications like minecraft servers or massive multiplayer online games.

The “azure pricing calculator” is a tool that allows users to calculate the cost of running their Azure VMs. This tool is helpful for understanding the costs associated with running your Azure VMs.

A Guide to Finally Understanding Azure VM Pricing

You presumably have at least one virtual machine (VM) operating if you have a Microsoft Azure account. Virtual machines (VMs) are one of, if not the most popular Azure service. Azure VMs are fantastic, but there’s one problem: pricing for Azure VMs might be perplexing!

You’ll learn about your alternatives in this post. You’ll learn how to go through all of the confusing Azure VM price choices to discover the one that’s right for you.

What are my alternatives?

There are five main categories of Azure VM pricing. Each sort of choice will differ in terms of price, performance, and availability.

Choose carefully since switching to a different model might be difficult after you’ve decided on a VM type and provisioned one.

Related: How to Get Microsoft Azure for Free: Everything You Need to Know

You may pay as you go.

Look to a pay-as-you-go option if you want the easiest, most basic way to start up an Azure VM. Microsoft will charge you for every second a VM resource is active using this sort of VM.

Pay-as-you-go is the most flexible option and is ideal for short-term workloads or situations that cannot be stopped.

Virtual Machine Instances Reserved

You may save 72 percent by reserving a virtual machine instance if you need to save money and know the VM will be active for at least a year.

A-Guide-to-Finally-Understanding-Azure-VM-PricingBuying a reserved instance

A VM may be reserved for one to three years in a specified location.

It’s simple to swap and return reserved instances. You may terminate a booked instance with an early termination charge if required, up to the annual limit. On the other hand, you may apply a reserved instance to other VMs within the same resource group and region, such as pay-as-you-go VMs.

Pricing on-the-spot

Reserved VMs save quite a bit. But if you really need to save money but aren’t necessarily concerned about 100% uptime or have automation to handle VM availability concerns, look into Azure VM Pricing on-the-spot.

Defining an Azure VM spot instanceCreating a spot instance from a virtual machine

You can get up to a 90% discount with Pricing on-the-spot. How is such a discount possible? On any given day, Azure data centers have unused capacity. To ensure data centers are being used as efficiently as possible, Azure introduced Pricing on-the-spot (spot VMs).

Spot VMs exploit unused Azure computing resources. The deal seems wonderful until you realize that spot VMs are only available for a limited time. If the data center requires extra computational capacity or the current pricing exceeds an originally agreed-upon maximum price, Azure may shut down or expel spot VMs at any time.

Spot VMs are ideal for testing, ephemeral workloads, and services that need to be restarted fast.

Benefits of Azure Hybrid

Windows Azure VMs are more costly to run than Azure Linux VMs. Why? Because of licensing issues with operating systems. You must have a license to operate Windows in any location.

The Windows license is included in the price of an Azure VM. That’s a good reduction if you can find a method to cut or remove that extra expense.

If your company currently has Windows-based on-premise servers that it wants to migrate to Azure VMs, you may save money by using your existing on-premise Windows licenses.

To take advantage of the Benefits of Azure Hybrid, you’ll need to contact Microsoft and negotiate a reduced rate.

When you migrate your Windows Server, SQL Server 2008, or Server 2008 R2 workloads to Azure, you’ll get three years of free security updates.

As of November 2020, Linux VMs can also take advantage of Benefits of Azure Hybrid!

Pricing for Development/Testing

Finally, consider for Azure Dev/Test VMS if you require Azure VMs to build apps on or for application testing. Azure Dev/Test VMs often offer cheaper costs and may give monthly credits, however they are only available to customers who have a current Visual Studio subscription.

What is Azure VM Billing and Usage?

Azure logs a “unit of consumption” for every second an Azure VM is operating. In terms of invoicing, a complete second is the lowest increment that an Azure VM may consume. When it’s time to charge, these seconds are added together and a monetary value is given, rounded down to the closest minute.

For example, if your virtual machine ran for five minutes and 30 seconds, Microsoft would only charge you for five minutes. The billing for Azure VMs is rounded to the closest minute.

When you terminate an Azure VM, Microsoft will continue to charge you for it until the machine and any connected managed disks are deallocated. Microsoft always charges separately for managed drives.

How to Choose the Most Appropriate Azure VM Pricing Model

Let’s pretend you’re a frugal shopper looking for a new Azure virtual machine. How do you decide which virtual machine is right for you?

  1. Determine the kind of performance you need. What about computing and storage? Memory?
  2. Choose the best location. It’s usually better to choose the area that’s nearest to the VM’s intended end-users, but keep in mind that various regions will cost more.
  3. Document any existing Windows licenses you have for your on-prem (if picking a Windows VM). You may be entitled to Benefits of Azure Hybrid pricing.
  4. Choose a method of payment. A overview of your choices is provided below.
    1. Benefits of Azure Hybrid
      1. You may pay as you go. – Most expensive, but most flexible
      2. 1 year reserved – Average savings of roughly 40%, but only for one year.
      3. 3 year reserved – Average savings of 60%, but locked in for three years.
      4. Spot Instances — Save up to 80% on average, but are less dependable since VMs may be evicted at any moment.
    2. Standard Rates
      1. You may pay as you go. – Most expensive, but most flexible
      2. 1 year reserved – Average savings of roughly 20%, but only for one year.
      3. 3 year reserved – Average savings of 30%, but locked in for three years.
      4. Spot Instances — Save up to 70% on average, but are less dependable since VMs may be evicted at any moment.

Look into using Linux virtual machines instead of Windows to save money. Except for some OS variants, Linux does not have the same licensing charges. For a premium VM charge, SUSE Linux Enterprise, for example, provides 24×7 support.

Pricing Options for Azure Support

Finally, while researching Azure VM price, keep in mind any support expenses! Assistance expenses may significantly raise your total Azure VM cost, depending on the type of support you need.

You have four alternatives for help:

  1. Basic – Microsoft provides this plan free of charge to all customers.
  2. Developer – $29 per month for basic break/fix assistance with restricted support windows
  3. Standard – $100 per month, more serious cases open, and 24/7 support
  4. Professional Direct – For $1,000 per month, you get 24/7 help, all severity cases, and training.


There are several Azure VM price choices, as well as a range of VM kinds, features, and add-ons. You may save money depending on your demands by carefully considering pricing possibilities.

Considering Reserved Instances, Spot Instances or Benefits of Azure Hybrids will net you large savings over time. Mapping your environment and VM needs to Azure VM pricing will help you to find the perfect combination!

The “azure transaction units calculator” is a tool that can help you understand the pricing of Azure. It will calculate how many transactions are needed to pay for one month, and it will give you an estimated monthly cost.

Related Tags

  • azure vm types
  • azure subscription types
  • azure spot pricing
  • azure disk pricing
  • azure cloud services pricing

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