If you’ve been in any Microsoft conversation lately, you’ve likely heard “Azure” mentioned more times than you can count, often alongside confusing questions about “series,” “sizes,” and “instances.”
But here’s the reality: While Azure is marketed as Microsoft’s crown jewel for digital transformation, for most organizations, it’s also a minefield of technical jargon, unpredictable costs, and complex licensing models. We’ve seen too many IT, procurement, and finance teams overcommit on paper—only to realize later they’re locked into unnecessary spend with little business value to show for it.
At MetrixData 360, we’ve been on both sides of the table. Our CEO, Mike Austin, spent years selling Microsoft licenses before founding MetrixData 360 to help customers take back control. Today, we help organizations optimize millions in Microsoft cloud spend — proving that you don’t have to buy into the hype to get real value from Azure.
Let’s cut through the noise and give you straight answers to the questions that matter most:
What is Azure, really?
What are Virtual Machines and why do “sizes” and “series” matter?
What’s an Azure Instance?
How do Azure pricing models work — and why do they seem so expensive?
Most importantly: How do you avoid overpaying?
Because Microsoft updates its instance types and pricing models frequently, we’ve also included a short explainer video to walk you through the latest instance types and what they mean for your business. Let’s dive in.
Azure is Microsoft’s name for their purchased estate in the public and private Cloud, similar to other services like Amazon Web Services (AWS) and Google Cloud. If you’d like to know more about what the Cloud is and problems your company could face by migrating there, check out our article 5 Problems When Moving to the Cloud. In general, Cloud computing means that your company would no longer host their own infrastructure.
Hardware, servers, and web servers that have been traditionally hosted, run, and maintained by a company would now be accessed through Azure’s massive pool of computing resources and you only need to pay for the resources that you use. Azure’s resources offer the ability to manage virtual machines (VM) and can provide both Platform as a Service (PaaS) and Infrastructure as a Service (IaaS).
Some of these services include supporting remote application access, deploying web applications, and content delivery, along with access to their API. Data storage allows for the safety of big projects; analytics provide real-time analysis of your data; networking allows the ability to manage traffic and balancing loads, providing security to encrypted keys, and sensitive assets
According to Microsoft Azure’s What is a Virtual Machine?, a virtual machine is a digital file that behaves like a physical, wires-and-bolts computer. It is a computer that has essentially been made by another computer. It runs on your browser and provides you with the same experience that you would have on a regular host operating environment. The virtual machine is closed off from the rest of your software estate, like a sandbox. You don’t want sand getting everywhere and you don’t want the virtual machine to leak into the rest of your environment.
Simply put, an instance in Azure can be understood as a Virtual Machine. Microsoft Azure Websites can be defined as a high-density, multi-tenancy platform. According to TechTarget’s article Multi-Tenancy, Multi-tenancy refers to a single instance of software applications that serves multiple customers at once, who are called tenants.
Each tenant is given the ability to change superficial features of the application like the color of the user interface but are not allowed to tamper with the application’s code. Microsoft Azure does not use virtual machines as a scale unit but as a means of tracking processes.
When you use Azure Virtual Machines (also called Web Roles or Worker Roles), every instance equals a virtual machine whose specifications are determined by the instance size you selected when it was first created.
When using Azure, according to Microsoft Azure’s article What are Azure Reservations? there are two Azure instance types:
Reserved instances mean that you are committing to a reserved virtual machine space in Azure’s Cloud estate for either one or three years (you can cancel or alter your reserves at any time) using a one-time, upfront payment. You can only purchase a reservation after you have purchased an Enterprise or pay-as-you-go subscription. According to TechTarget’s article Azure Reserved Virtual Machine Instances, this method can save you anywhere from 72% to 80% of your Azure expenses when compared to the pay-as-you-go option.
Shared instances use a high-density model in which multiple tenants may exist on the same virtual machine, but each has its own process with isolation being provided by the platform through sandboxing. The scale unit is not an entire machine but rather an additional process, which is very likely to run on a separate virtual machine. This is also an excellent way to cut down spending in Azure since a shared scope allows for discounts to be applied across subscriptions.
Similar to many other services offered on the Cloud, Azure primarily follows a subscription-like price model, where you can pay as you go, and you are charged based on your usage. However, if one application uses several Azure services, each service will be subject to possible multiple pricing tiers. For this reason, reserved instances would be recommended since discounts are offered should a client make a long-term commitment to any particular service.
Since there are many factors involved with the end price of Azure, Microsoft has an Azure Calculator that can offer you a rough estimate of your final cost, based on numerous factors such as your region, your operating architecture, and which tier you have.
According to Datamation’s Azure Pricing: 10 Pitfalls to Avoid, while Azure has a wide variety of pricing options, there are also a few ways you can accidentally spike your Azure cost. Any of the following scenarios can steadily and anonymously hike up your software bill.
These types of incidents may seem small at first and can go unnoticed by the company, in fact Azure’s very pricing system makes it difficult for users to anticipate what the final cost will be. If something only costs a few cents an hour to run, that does not seem like a lot. When scaled up to the whole company, though, and left to run indefinitely, it can cost a company thousands of dollars.
Understanding how Azure works can help improve the quality of your experience should you choose to purchase it for your business. At MetrixData360, it’s our goal to help you make an informed decision that best suits your company’s unique software profile. We have seen many businesses attempt to move to the Cloud only to have unseen expenses drain their budget, so planning ahead and doing your best to understand the technology will serve you better in the long run. For more information on how you can save money while using Azure, click the link below to check out our Azure Usage Service Page.
