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Important Ways to Regain Control of Azure Cost Management

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Introduction

This blog will brief on vital ways to regain control of Azure cloud cost and to achieve cost optimization. To start with, let us have a short introduction about Azure cost management. As the growth towards cloud adoption is increasing in enterprises, it is getting more difficult for enterprises to manage the cost spent on the cloud across the organization. Microsoft Azure Cost Management, also known as Cloudyn, helps these enterprises to efficiently manage and optimize the cost spent across Azure and other clouds.

Azure Cost Management

Azure Cost Management is a SaaS solution that enables organizations to monitor, allocate, and optimize the cost spent in a multi-cloud environment. It is available to all Azure customers and partners. Azure offers end-to-end cost management and optimization solution that helps customers and partners make the most value for what they spend. With Azure Cost Management in place, Microsoft is committed to continuing the investment in supporting a multi-cloud environment including Azure, AWS, and Google Cloud Platform.

Azure Cost Management and Billing feature can be used to

  • Conduct billing administrative tasks such as paying your bill
  • Manage billing access to costs
  • Proactively apply data analysis to your costs
  • Set spending thresholds
  • Identify opportunities for workload changes that can optimize your spending
  • Download cost and usage data that was used to generate your monthly invoice

One of the major reasons for enterprises to move towards cloud adoption is the need for significant cost savings. While cost savings in the cloud versus on-premise is achievable, it is also easy to end up spending more than the anticipated budget due to cloud sprawl, undefined governance, and generally unexpected or unbudgeted usage of Azure resources.

Cost management is an organizational problem, and it should be an ongoing practice that begins before the money is completely spent on cloud resources.

With some basic analysis and proper planning, one can regain control of Azure cloud costs and achieve cost optimization.

Now lets us investigate a few techniques to reduce the cloud cost and achieve optimization.

Reserved Instances

Reserved instances reduce the cost up to 72 percent compared to Pay-As-You-Go subscriptions for the selected Azure services. When the reservation savings are combined with Azure Hybrid Benefit the cost is reduced up to 80 percent. Monthly payment options can be used at no additional cost to lower the upfront cash outflow.

Advantages of one-year or three-year terms and pay upfront can be taken to achieve the estimated budget goals. Reservations can be exchanged based on the need. It can be canceled at any time and reservations for the remaining months can be returned for a termination fee.

Azure Hybrid Benefits

The Azure Hybrid Benefit is a pricing benefit for customers who have licenses with Software Assurance, which helps to maximize the value of existing on-premises Windows Server and/or SQL Server license investments when migrating to Azure.

Eligible customers can save up to 40% on Azure Virtual Machines (IaaS) and save up to 55% on Azure SQL Database (PaaS) and SQL Server in with Azure Hybrid Benefit, which increases up to 80% when combined with Azure Reserved Instances as discussed above.

Shutdown / Resize the Unused / Underused Resources

Azure Advisor helps in optimizing and reducing the overall Azure spend by identifying idle and underutilized resources. Though certain application scenarios/designs can result in low utilization of resources, the cost can be saved by managing the size and number of virtual machines. The recommended actions are shut down or resize, which is specific to the type of resource that is being evaluated.

Azure Advisor determines the type of workload by analyzing the CPU utilization characteristics of the workload. It shows the estimated cost savings for either resize or shut down. Recommendations for cost saving is available at the Cost tab on the Advisor dashboard of Azure Portal.

Autoscaling

Autoscaling is the process of dynamically allocating resources to compensate for demanding performance requirements. As the workload increases, an application may need additional resources to preserve the desired performance levels and satisfy service-level agreements (SLAs). As the workload decreases, the additional resources are no longer required and can be de-allocated to cut down the costs.

Autoscaling takes advantage of the elasticity of cloud-hosted environments. It reduces the need for an operator to continuously monitor the performance of a system. There are two main ways that an application can scale:

  • Vertical scaling – Called as scaling up or down, which means changing the capacity of a resource
  • Horizontal scaling – also called scaling out or in, which means adding or removing instances of a resource

Azure Budgets

Budgets in Cost Management helps in planning and driving organizational accountability. With budgets, one can account for the Azure services that are being consumed or subscribed to over a specific period. It helps in proactively managing the costs, and in monitoring how the spending progresses over a period. When the budget exceeds the set threshold, notifications are triggered and the resources are not affected and the consumption is not stopped. Budget resets automatically at the end of a period (monthly, quarterly, or annually).

Choose the Right Azure Compute Service

Azure offers several ways to host application code. The term compute refers to the hosting model for the computing resources that an application runs on. An application can be operated more cost-efficiently by selecting the right to compute service that fits. If an application consists of multiple workloads, each workload is evaluated separately. A complete solution may consist of two or more computing services.

The above-mentioned methods can be used to efficiently manage and use the Azure resources, which in turn will significantly reduce the cost spent on the cloud resources.

Visualizing the Cost of the Azure Resources at an Application Context Through Severless360

As the cloud adoption in the enterprise increases, it is accompanied by the rapid growth of the cloud resources, which over a short period becomes more complex to identify, where a resource constitutes in an overall cloud infrastructure.

To mitigate this problem Serverless360 has come up with a feature called Resource Map. Resource Map is a platform to visualize and govern Azure resources originating from different subscriptions in one place. Azure resources from different Subscriptions, Resource Groups, or the resources constituting a business application can be grouped under a single scope.

A Scope is a logical container which in turn can have multiple environments and resources underlying. The cost visualization capability in Resource Map comes in to provide clarity on the expenditure on Azure Resources in fact across different Azure subscriptions. At every Scope, there is a Cost section that provides insight on the cost spent on the Azure resources grouped in that scope.

Azure Cost Management

The following use cases can be addressed using this capability

  • The cost spent for a specific period can be visualized by setting a filter on the ‘From’ and ‘To’ period.
  • Graphical representation of cost spent for a specific period grouped based on a resource, resource type, and environment can be visualized by choosing the pie or the bar chart.
  • Day wise Cost spent on a specific resource or resource type or environment can be visualized by choosing the line chart.
  • Table chart can be used to visualize cost as data for the specified duration
  • Visualize Azure cost data Cost spent

Conclusion

The acceleration towards cloud adoption is continuously increasing and it will only continue to increase in the future. At the same time, the complexity of managing and optimizing the cost spent on cloud resources is going to be a big overhead. This blog has revealed a few noteworthy ways in which the cost spent on Azure resources by the organization of any scale can be significantly optimized using Serverless360.