Enhance the efficiency of your cloud expenditure with Azure Reservations

May 20, 2023

You can save money and optimize your investment in Azure when you’re ready to use it. By buying reserved instances, you can get a big discount on cloud resources for workloads that consistently use the same amount of resources. This can reduce your costs by up to 72 percent compared to the regular pay-as-you-go prices.

You can get Azure Reservations by commiting to using them for either one year or three years. This applies to different types of resources like virtual machines, storage, databases, and more. When you can plan and commit to the resources you need in advance, it helps us be more efficient in providing those resources. This allows us to give you even more savings. These benefits work for both Windows and Linux virtual machines.

Additionally, you can combine the savings from reserved instances with the Azure Hybrid Benefit. This is helpful when you run workloads both on-premises and in Azure. By doing this, you can save up to 80 percent compared to the regular pay-as-you-go prices.

How to get your Azure Reservation

A reservation discount is only available for certain subscriptions like Enterprise Agreement, Microsoft Customer Agreement, Cloud Solution Provider (CSP), or pay-as-you-go. These discounts are related to how you pay for your resources and don’t affect how your resources work. Don’t worry. There are no extra fees if you choose to pay monthly.

To decide which reservation to buy, you can look at your usage data in the Azure portal. You can also get recommendations on which reservation to purchase from tools like Azure Advisor (for virtual machines only), the Cost Manage Power BI app, or the Reservation Recommendations REST API.

These recommendations are based on analyzing how much you’ve used your resources in the past seven, 30, and 60 days.

Simple and flexible reservations

You can easily buy Azure Reserved VM Instances in just three steps.

  1. First, you choose the region where you want to use Azure.
  2. Then, you select the type of virtual machine you need.
  3. Finally, you decide on the term, either one year or three years. That’s all there is to it!

When you buy a reservation, you get discounts on the resources you use that match your choices. These resources can include VMs, SQL databases, Azure Cosmos DB, and more. The discounts apply based on certain attributes like the SKU, regions, and scope. Scope determines where the discounts apply, and you can choose to apply them to a subscription or a resource group. If you choose a resource group, the discounts only apply to that specific group, not the entire subscription.

You can manage your reservations for Azure resources. This means you can change the scope to apply the discounts to a different subscription, choose who can manage the reservation, divide a reservation into smaller parts, or change the size of the virtual machine. If you have an Enterprise Agreement (EA) or a Microsoft Customer Agreement (MCA), you can access enhanced reservation costs and usage data through Azure Cost Management and Billing. These customers can also see the amortized cost data for reservations and use it to determine the monetary value of a subscription, resource group, or resource.

Azure capacity on demand

Accessing computing power when needed is important, especially for essential applications running on Azure. Now, a new feature called on-demand capacity reservations lets you reserve computing power in advance. You can choose the virtual machine size and reserve it in a specific Azure region or availability zone. You can reserve it for as long as you want, and if you change your mind, you can cancel the reservation at any time without any commitment.

If you have a reservation but realize you no longer need it, you can exchange it for a different reservation or get a refund of up to $50,000 USD within a year. You can also cancel a reserved instance at any time and get the remaining months’ worth of reservation back to Microsoft.