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InfoQ Homepage News Microsoft Announces General Availability of Azure Reserved VM Instances

Microsoft Announces General Availability of Azure Reserved VM Instances

On the 16th of November, Microsoft made Azure Reserved Virtual Machine (VM) Instances (RIs) generally available to customers worldwide. They are now able to reserve VMs on a one- or three-year term and have up to 72% cost savings versus pay-as-you-go prices. The cost savings can be even more for Windows Server customers combining Azure RIs with Azure Hybrid Benefits.

Takeshi Numoto, CVP Cloud, and Enterprise at Microsoft on the Azure blog said:

Azure RIs gives you price predictability and help improve your budgeting and forecasting. Azure RIs also provides unprecedented flexibility should your business needs change. We’ve made it easy to exchange your RIs and make changes such as region or VM family, and unlike other cloud providers, you can cancel Azure RIs at any time and get a refund.

With RIs the billing is per-second, yet Microsoft rounds down to the last minute, meaning a VM running for 645 seconds is billed at 600 seconds. Combined with the built-in capability to schedule auto-shutdown VMs, customers have more ways to save costs. Additionally, the free Azure Cost Management by Cloudyn, can further help optimize resources, manage budgets, and allocate costs. This service can also provide price comparisons between RIs and pay-as-you.

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Azure RIs can be purchased through the Azure Portal by specifying the Azure region, virtual machine type, and the term (one or three years). The virtual machine OS can be either Linux or Windows, the Server type can be OS only, Oracle, BizTalk or SQL Server, and the instance can be of various dimensions in CPU, memory, and storage. Moreover, in the billing option, the user has the option to select the term for the RI. For more details on pricing and usage, see the Azure Reserved Instances site. Customers can forecast costs using the Azure Pricing calculator and choose the Virtual Machines product.

Public cloud provider Amazon has RIs as a feature in the AWS Cloud for a number of years and Microsoft has brought this feature now to Azure VMs. Microsoft provides the customer the flexibility to exchange or cancel their purchased RIs at any time. This flexibility is not present with AWS RIs, where the customer has to find a third party buyer to take over the remaining term. However, AWS provides a Reserved Instance Marketplace, where shorter terms can be offered. Besides, AWS and Microsoft, Google offers Committed Use Discounts (CUDs) on a certain amount of computing resources for a 1-year or 3-year period. Their offering is more flexible in combining CPU, disk, and memory to build custom VM as a reserved instance, whereas with AWS and Microsoft the customer is tied to a predefined instance collection.

The differences between the public cloud providers and their reserved instances offerings lie in cost-saving percentages, performance, and flexibility. The challenge for RI VMs customers can be to choose the right size instance, or to obtain the best cost savings. RightScale, an enterprise cloud management company, states:

Companies find it difficult to choose the best discount options and forego savings that can range from 20-70 percent. For example, AWS has more than 60,000 discounting price points just for reserved instances, while Azure recently announced a new reserved instance offering.

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