Factors That Can Affect Costs in Azure
Slide deck explaining factors that affect Azure costs: service type and size, usage meters, region selection, time running, supporting costs, and strategies for cost reduction using Azure Pricing Calculator and Microsoft Cost Management.
Factors That Can Affect Costs in Azure
Introduction to factors that can affect costs in Azure: understanding what drives Azure costs and how to manage them effectively.
Factors That Can Affect Costs in Azure
Introduction to factors that can affect costs in Azure: understanding what drives Azure costs and how to manage them effectively.
What drives Azure cost?
Azure cost depends on what you deploy, how much you use, and where/how long it runs. What you deploy (service plus size). How much you use (meters). Where it runs (region). How long it runs (time).
Outcomes for this lesson
You'll be able to estimate, explain, and reduce common Azure cost drivers. Identify key cost drivers (service, size, usage, region). Explain why 'time running' matters. Apply basic cost reduction moves (right-size, shut down). Use tools: Azure Pricing Calculator plus Microsoft Cost Management plus Billing.
Meters: how Azure measures usage
Azure often bills you based on measured consumption (meters). Compute time (Virtual Machine (VM) running). Storage used (gigabytes (GB) stored). Transactions/requests (operations performed). Networking (data moved).
Service, tier, and Stock Keeping Unit (SKU)
Your service type, tier, and SKU choice sets your baseline cost. Service type: Virtual Machines (VMs) vs Platform as a Service (PaaS). Tier: Standard vs Premium (example). Stock Keeping Unit (SKU): specific size/configuration. Bigger/higher choices often cost more immediately.
Region can change the price
Pick region for compliance/latency first, then compare pricing across valid regions. Same service can cost different amounts by region. Start with compliance plus latency requirements. Compare prices across eligible regions. Availability can vary by region.
Time running equals cost
Per-hour pricing becomes a monthly bill when resources stay on. 24/7 resources accumulate hours quickly. 24/7 approximately equals 730 hours/month (rule of thumb). 'Not logged in' does not mean 'no cost'. Dev/test environments are frequent culprits.
Supporting costs you can't ignore
The bill often includes extra costs beyond the main resource. Cross-region data transfer. Egress: data leaving Azure to the internet. Storage performance, backups, managed disks. These can materially change the total.
3 cost reduction habits
Reduce cost by sizing correctly, controlling time-on, and reducing data movement. Right-size: measure what's actually limiting (CPU/memory/disk/network). Control runtime: schedule shutdown for non-production. Reduce data movement: caching plus Content Delivery Network (CDN).
Savings vs flexibility
Commitment discounts reduce cost, but they reduce flexibility. Savings plans: commit hourly spend for discounted compute. Reservations: commit to resources (often 1 or 3 years). Azure Hybrid Benefit: reuse eligible licenses for discounts. Best fit when usage is predictable.
Estimate plus track costs
Use the Pricing Calculator to estimate and Cost Management plus Billing to monitor and alert. Estimate: Azure Pricing Calculator. Track: Microsoft Cost Management plus Billing. Use budgets plus alerts for early visibility. Review regularly, not only at month-end.
Avoid surprises: pitfalls
Most cost surprises come from hidden add-ons, always-on resources, and lack of ongoing tracking. Include supporting costs (disks, backups, networking). Shut down/scale down non-production when idle. Pick region by requirements first, then compare price. Plan for savings plans/reservations; don't assume. Use budgets plus alerts, not month-end guesses.