One of the main incentives for organisations to move to Microsoft Azure is the significant cost savings that are possible. It can be easy, however, for Azure costs to rack up, leading to unexpectedly high Azure costs.

While savings in the cloud versus on-premises is very much achievable, with the likes of cloud sprawl, undefined governance and general unexpected/unbudgeted usage of Azure resources, costs can quickly escalate.

The good news is that with some basic analysis and proper planning, your organisation can regain control of Microsoft Azure costs and achieve true cost optimisation. Here are five simple ways to keep your Azure costs under control if you run servers in Azure (Infrastructure as a Service).

1.    Use Azure Reserved Virtual Machine Instances

Azure Reserved Virtual Machine Instances (RI) are a programmatic way of committing to a fixed number of Virtual Machines (VM’s) and sizes in Azure for a period of one or three years.

In exchange for that commitment, Microsoft charges a fixed rate for VMs. This will provide your organisation with significant cost savings compared to a pay-as-you-go model.

While RIs are a great way to save costs on Virtual Machines, it is important to first assess the savings against the risk of miscalculating your needs. If you do not consider historical/forecasted runtime and resource utilisation, it will be hard to evaluate if and what type of Reserved Instances are the best fit for your organisation.

2.    Azure Hybrid Benefits

Azure Hybrid Benefits can be combined with RIs to provide up to 70% savings compared to Azure’s pay-as-you-go model. While RIs helps achieve savings on the compute side of Virtual Machine costs, Azure Hybrid Benefit can generate significant savings on the operating system (OS) and SQL Server licensing side.

If you have Windows Server or SQL Server licenses with Software Assurance you are eligible to run Azure VM’s at Linux-based pricing, meaning Microsoft will not charge you for the OS (or SQL license). As a result, you only pay for the hourly rate for compute of the virtual machine, eliminating the hourly cost of the OS/SQL Server license.

3.    Understand your utilisation

While Reserved VM Instances and Azure Hybrid Benefits focus on programmatic savings, you can also reduce your costs by ensuring you are maximising utilisation of existing resources at the lowest possible cost by right sizing your VMs.

To properly right-size, it is important to understand utilisation trends in your environment and then apply utilisation metrics to compare with available VM sizes. You should perform this evaluation before committing to specific RI size/families.

Tools such as Azure Advisor and other third party apps can help identify proper sizing.

4.    Schedule VMs to start and stop based on usage

Simply shutting down a VM for periods that it does not need to run, for example overnight or at weekends, can lead to significant cost savings.

There are several ways to implement automatic start/stop functions – Azure Automation Runbooks is an easy way to get started. With Azure Automation Runbooks schedules can be especially effective for test/dev or environments with fixed availability.

5.    Eliminate waste

By ensuring you are using your resources correctly, you can eliminate waste and reduce your Azure costs.

Putting in place a proper governance strategy will help define how to identify and eliminate waste. Core to a governance strategy is resource tagging. Once defined and properly implemented, it is easy to identify and actively manage resources based on metadata assigned to resources.

Another easy way to eliminate waste is by identifying idle resources. If a resource is not being used, right-size it, stop and deallocate or delete it altogether (of course, you should first consider any adverse impacts before deleting).

There are many other types of waste you can consider when attempting to reduce your Azure costs, for example hot vs. cold storage, public IPs not in use, outdated backups/archives. By having an Azure governance strategy in place early you can minimise waste from the start.

Building governance to reduce Azure costs

At Incremental we have invested heavily in helping our Microsoft Azure customers optimise their Azure environments with strong Azure governance strategies.

To find out more about how to optimise Microsoft Azure for your organisation, download our guide to Microsoft Azure security, cost optimisation, monitoring and governance. Alternatively, get in touch today to speak directly with one of our Azure specialists.