5 Ways to Save Costs on Microsoft Azure

To ensure costs remain at the desired level, organizations need to manage resource consumption. Azure offers a wide range of tools to help.

Sagar Nangare

March 19, 2021

5 Min Read
5 Ways to Save Costs on Microsoft Azure
(Source: Pixabay)

As organizations continue to move applications, data, and workflows to the public cloud, cloud spend is becoming a major percentage of IT spend. In this article, I’ll cover a few ways you can cut cloud costs significantly when operating on the Microsoft Azure cloud.

What is Azure cost optimization?

Azure cost optimization, or Azure cost management, is a process that helps organizations lower their cloud costs. The goal is to create a balance between corporate needs and infrastructure use, reducing as many unnecessary costs as possible.

Azure is a cloud platform and does not require upfront costs for setting up the infrastructure. Additionally, services offered by Azure often come with granular control over a wide range of aspects. This control enables customers to better manage their costs.

To ensure costs remain at the desired level, organizations need to manage resource consumption. Azure offers a wide range of tooling dedicated to this purpose. However, to truly optimize costs, you do need a high level of expertise and understanding of the Azure cloud.

To ensure your costs match your business needs, you can create a cost optimization strategy. The purpose of this strategy is to ensure your costs remain manageable, but you should also strive for flexibility. Business needs and resource requirements are dynamic in nature.

5 ways to save costs on Microsoft Azure

Here are five ways you can cut your Azure bill substantially while delivering the same level of service to customers and internal users.

Manage orphaned VMs and VM storage

When you delete or disable a virtual machine (VM) in Azure, the attached storage usually persists. This means that even if you are not actively using your storage disk, you will still pay for it. Similarly, even if you have unused or unknown virtual machines—sometimes called “orphaned” VMs—you will continue paying for them.

To fix this, you need to make sure that all resources running on Azure are actively used. Use the Azure portal to search for managed disks that you don't own or that are not attached to any VMs. If you need to keep the data, use Azure Backup to copy the data and store it in Blob Storage at a much more affordable price. Do the same for orphaned virtual machines. This lets you save costs while retaining the option to restore the disk or VM in the future if needed.

Leverage storage tiering

The Azure Blob Storage model offers several storage tiers. Premium and Hot tiers have a higher cost but can be rapidly accessed at any time. Cool and Archive storage tiers have a much lower cost GB/month but place limits on the frequency and speed at which you can access the content, and they have higher data retrieval fees.

Using the right storage tier for each type of data can be very cost-effective. For example, you can automatically move infrequently accessed data to a low-cost cold storage tier and save a large percentage of ongoing storage costs in the long run.

If you have cloud-based file shares using Azure Files, you can also leverage the tiering concept by ensuring workloads that do not require high performance run on the Standard rather than the Premium tier.

Azure Spot Instances

Azure spot virtual machines (spot VMs) grant discounts of up to 90% compared to pay-as-you-go prices for the same VM types. Spot instances are unused Azure compute capacity, which you can bid for on the spot market. Whenever Azure needs to reclaim capacity, Azure infrastructure deletes the Spot VM with notice of only 30 seconds. So, spot VMs are mainly useful for workloads that can be interrupted, such as batch jobs, development/testing environments, and distributed computing workloads.

Using B-series VMs

Azure provides B-Series VMs, which are suitable for workloads that don’t require high CPU performance all the time but occasionally require more performance. B-series are a cost-effective way to support these types of workloads.

B-series VMs detect that workloads are not fully using the CPU capacity and accumulate credits. At other times, when the workload needs more performance, it uses these credits to reach up to 100% vCPU performance.

Identify servers that are not always in use, such as domain controllers, file servers, web servers, and small database servers—all of these tend to have bursty CPU usage. Consider using B-series instances for these workloads, which are substantially cheaper than regular VMs and can provide similar performance for this usage profile. Otherwise, you will need to pay for full vCPU capacity, even though the workload typically does not utilize it.

Use Azure Hybrid benefit

The cost of most resources on Azure is divided into two parts: Infrastructure cost and software license cost. If your organization already owns existing Microsoft licenses, Azure Hybrid Benefit is a bring your own license (BYOL) program that lets you save on the software license component.

There are several products served by Hybrid Benefit, including:

  • Windows Server—if you are running Azure VMs with Windows Server, and you have an existing license, Hybrid Benefit lets you reduce up to 40% on VM costs.

  • SQL Server—if you are using Azure SQL Database, Azure’s managed SQL Server service, you can save up to 40% on VM costs and use the rebate to cover the cost of SQL Server Enterprise Virtual Machines.

  • Dedicated Hosts—you can extend Windows Server and SQL Server licenses to Azure’s dedicated bare-metal host offering.


There are five ways you can slash your Azure cloud bill:

  1. Managing orphaned VMs and storage to remove wasted resources

  2. Leveraging storage tiering to ensure you don’t overpay for archives or infrequently-used data

  3. Leveraging Azure spot instances to get discounts of up to 90% for workloads that don’t require reliability

  4. Using inexpensive B-series VMs for workloads that don’t require consistently high CPU performance

  5. Using Azure Hybrid Benefit to get discounts for your existing Microsoft licenses

I hope using these tips will help you leverage the power of the cloud while keeping control of costs.

About the Author(s)

Sagar Nangare

Sagar Nangare is a technology blogger, who writes on the cloud-native stack, cloud, 5G, edge, multi-cloud, and networking technologies. Currently, he serves as a Manager - Strategic Marketing at ACL Digital.

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