Domain 3 of 3 · Chapter 1 of 4

Cost Management

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Included in this chapter:

  • What drives the cost of an Azure workload
  • Levers that reduce Azure cost
  • Estimating cost before deployment: Pricing Calculator vs TCO Calculator
  • Tracking and controlling spend: Microsoft Cost Management
  • The purpose of tags
  • Recognizing these questions on the exam

Estimate-before-deploy vs track-after-deploy tools

AspectPricing CalculatorTCO CalculatorMicrosoft Cost Management
When usedBefore deployingBefore migrating (TCO concept; now via Azure Migrate)After deploying
What it answersWhat will this planned Azure config cost?On-premises vs Azure: which is cheaper?What am I actually spending now?
Primary inputPlanned Azure services and SKUsCurrent on-premises workloadLive resource consumption
Set budgets / alertsNoNoYes
Cost to useFreeFree (standalone calculator retired)Free (analyzes your spend)

Decision tree

Estimating cost BEFOREyou deploy?YesNoComparing on-premisesvs Azure cost?YesNoTrack actual spend orset a budget/alert?YesNoTCO Calculatoron-prem vs Azure(now Azure Migrate)Pricing Calculatorprice a planned configCost Managementanalyze, budget, alertWant to cut thebill instead?steadyinterruptibleReservations1/3-yr steady loadSpot VMsevictable batch
Cheat sheet

Cheat sheet

  • Resource type, its settings, and region set the per-unit price
  • Usage drives cost because billing is pay-as-you-go
  • Region is a cost choice: the same workload prices differently by geography
  • Inbound data is generally free; outbound (egress) is billed by zone
  • Reserve capacity for steady, predictable workloads
  • Azure Hybrid Benefit reuses on-prem Windows/SQL licenses to pay only base compute
  • Run interruption-tolerant work on Spot VMs at a deep discount
  • Right-sizing and autoscale cut waste
  • Pricing Calculator estimates a planned Azure config before deploy
  • TCO compares on-premises vs Azure cost to justify migration
  • Calculators estimate before deploy; Cost Management tracks after
  • Cost Management lives under Cost Management + Billing
  • Cost analysis breaks spend down by scope, service, and tag
  • Budgets alert on spend; they do not stop it
  • A tag is a name/value pair of metadata
  • Tags organize resources for cost reporting
  • Tags are not inherited by default
  • Azure Policy can require, append, or inherit tags
  • Planning tools estimate; they never show actual spend
  • Forecasted budget alerts warn before you exceed the budget
  • Attach an action group to a budget to automate a response
  • Budgets scope to subscription, resource group, or management group; reset is monthly/quarterly/annual

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Also tested in

References

  1. https://learn.microsoft.com/en-us/azure/storage/common/storage-redundancy
  2. https://learn.microsoft.com/en-us/training/modules/plan-manage-azure-costs/
  3. https://azure.microsoft.com/en-us/pricing/details/bandwidth/
  4. https://learn.microsoft.com/en-us/azure/cost-management-billing/reservations/save-compute-costs-reservations
  5. https://learn.microsoft.com/en-us/azure/cost-management-billing/scope-level/
  6. https://learn.microsoft.com/en-us/azure/virtual-machines/spot-vms
  7. https://azure.microsoft.com/en-us/pricing/calculator/
  8. https://learn.microsoft.com/en-us/training/modules/describe-cost-management-azure/
  9. https://learn.microsoft.com/en-us/azure/cost-management-billing/costs/overview-cost-management
  10. https://learn.microsoft.com/en-us/azure/azure-resource-manager/management/tag-resources
  11. https://learn.microsoft.com/en-us/azure/azure-resource-manager/management/tag-policies