While paying for Reservations is not a headlining, game-changing addition to Azure, I can see this being of much benefit to companies with smaller Cloud budgets who would rather hold onto their financial resources longer. This new option allows Azure billing administrators to pay for their 12 or 36 month Reservations at an even amount monthly, instead of on an all upfront basis.
Quick background on Reservations in Azure
Saving money on your cloud spend can be an on-going focus for Cloud Administrators for companies of all sizes. As with many cloud vendors, Azure provides a simple means of saving money on your Resources by using Reservations. Reservations are a billing commitment (1 or 3 years) for a given Resource such as a VM. By prepaying, you can see a significant reduction in cost to run your workloads. The majority of the savings is on the infrastructure consumed to run your resources. You can get an idea for what savings to expect with Reservations by looking at the Azure Cost Calculator. Cost reductions on Windows Server VMs and Azure SQL Database can reach up to 80%.
To be eligible to purchase Reservations, one has to have the subscription owner role in a Azure Enterprise or pay-as-you-go subscription. After the Reservation period expires, Resources are returned to being billed at the pay-as-you-go rate.
How to leverage monthly reservation payments?
In order to take advantage of this new payment model, only the following Resource types are eligible to reserve by subscription owner role holders:
- Virtual Machines
- SQL Database
- SQL Data Warehouse
- Cosmos DB
- App Service stamp fee
For example, a common use case for reservations are Azure VMs. Navigate to the Reservations blade in the Azure Portal. Let’s say you would like to reserve some VMs that are always running. The Recommended tab will give you VMs that will benefit most from reserving based on the usage over the last 30 days. Select the VM with the Monthly billing option. Click the blue Select button to add it to the cart.
The Purchase Reservations blade will show information on all of the Reservations you have added. An added feature of this screen is to check how many remaining payments you will have on your Reserved Resources via the “View Full Payment Schedule” link found under Today’s charge.
And in just few button clicks, you are now saving on your monthly Azure bill!