>> Hey friends. As an Azure customer myself,
I am always looking for ways to save
money and pinch some pennies in the Cloud.
Yashesvi Sharma is here to show us how
Azure Reserved VM Instances can save
up to 80 percent or even more overpay as you go pricing.
We're going to learn all about it today on Azure Friday.
Hey friends! I'm Scott Hanselman.
It's another episode of Azure Friday.
I'm here with Yashesvi Sharma.
We're talking about Azure reservations.
You have a way for me to save money.
I've got lots of virtual machines running in Azure
and I love to find ways to pinch pennies in the Cloud.
What is Azure reservations?
>> Scott, Azure reservations is
a way for you to pre-purchase
your virtual machine's compute usage
for a duration of one or three years.
>> Is this like leasing a car,
like I know I'm going to be in
Azure for a year or three years?
>> Yeah.
>> Just pay upfront.
>> Yeah. You can think of that way.
Yes. If you're going to use a VM 24/7,
365 days a year,
your base consistent usage,
you should just buy reservations and save
up to 80 percent on that usage.
>> That's fantastic. Now that's seems like a huge amount.
It's not 10 percent or 20 percent,
it's 60, 70, 80 percent.
Why so much? How is that possible?
>> Well, there's really two things.
One, you are committing to
the usage over a long period of time.
It also gives us visibility into
your demands for the data center usage.
>> So you know that that VM
is going to be running for that time.
So, for capacity planning it makes it easier for Azure.
>> Yes.
>> I see. So then, when I do this,
do I pay upfront, just pay all at once?
Now you just don't think about paying for
the next one or three years.
>> So you just pay upfront for reservation and we
stop charging you on demand for a matching VM.
>> Okay, for a matching VM.
So it's not for any VM.
It's not like a discount card.
I am buying a SKU.
>> Yes.
>> And a location?
>> Yes. You buy a reservation for
a region and for a VM size.
The reservation applies on
that matching VM and your usage.
>> Okay. I wouldn't want to turn that VM on and off then.
It really is for VMs that are in full usage.
If I turn it off, I've still paid.
>> Yes.
>> So I don't, how, it doesn't save me any money.
>> Yeah. It's best for
customers who have consistent base usage.
If you shut it off, you've still paid for it.
In that case, you want to keep your VMs running.
>> Now another thing that we have in Azure compute
that saves huge amounts is this low priority VM.
That's for VMs that don't matter as much.
>> Yeah. >> Can go away at any time.
I would like to say I don't deeply care about those VM.
It's for compute workloads that are bursty.
But this is for VMs that I care about.
>> Yeah. This is your main base usage.
This is for workloads that you want to run 24/7,
not your interruptible workloads.
>> Okay. So that I should look at all of
the different VMs that I currently use.
There should be a huge opportunity for me to take.
So, I have like myself
two or three VMs that are in the Cloud.
But someone else might have hundreds.
>> Yes.
>> They could save huge money
on all of those hundreds that are running 24/7.
>> Yeah. So, really
just customers should just look at their usage,
just see what VM and region they are
using consistently over a period of time.
>> Okay.
>> And you should buy reservations
for that for their consistent usage.
>> What if I buy a basic or D-series,
and then in 18 months
when I'm halfway through my three years,
and my company becomes very popular,
and I need a bigger VM,
I need to upgrade or scale up that
VM but I've paid for a smaller one.
>> Yeah. So, reservations are there for standard series.
>> Okay.
>> Not for basic but standard if you've,
>> Have standard.
>> Let's say you have D-series and you later want to move
to E-series or your workload demand changes,
>> Okay.
>> You can exchange a reservation.
There's unlimited exchanges that you can perform,
and there is no penalty on exchange.
>> See, this is great. This makes me feel like,
again, I go to like renting or leasing a car.
You buy a basic car or a standard car instead.
You want to get a deluxe car.
>> Yeah.
>> You just take it into the rental agency
and there's no penalty for the upgrade.
>> Yeah. That's exactly how it is. Then you exchange.
You just have to buy the new value.
The new value of reservation should
be greater than what you're returning.
>> Indeed, right. So you would not exchange down.
>> Yes.
>> Okay. That's very interesting.
What if I have to cancel?
Like you break your lease, there's usually
a penalty when you break a lease on a car.
>> Yeah. We understand that happens.
If you have a need for cancellation, you can cancel it.
There is a 12 percent only termination fee.
There is a limit of up to US$50K,
US$50,000 in a 12 months window.
>> As I see you can only cancel up to 50,000.
>> Yes.
>> So if I'm a giant company,
and I've bought millions
and millions and millions of dollars,
I wouldn't be able to cancel it all.
>> No.
>> So, it prevents abuse.
>> Yeah. It prevents abuse. You should plan.
You should really plan for that VM usage in long term.
>> I feel a little bad because
I've had a couple of VMs running for three years.
This money has been there ready to be saved.
>> You can start saving now Scott.
>> Fantastic. So what does the UI look like?
>> Okay. So let's go through
the experience. Here I'm on the portal.
You can go to ''All services'',
and just either find reservations here.
>> Okay.
>> I have it right here. Let's click on it.
This is where I can see all my reservations.
I can manage my reservations.
>> Okay.
>> So this reservation, I purchased yesterday.
It's valid for one full year.
>> Okay.
>> The scope is shared. We'll talk about scope a
little bit more as we go into the purchase experience.
>> Okay.
>> It is for this VM, and it's in this region,
and the quantity is one. So, let's go.
>> Just to be clear, the quantity is one,
I could buy two VMs,
but only one is discounted
because I only have one reservation.
>> So I have only one reservation.
If you're running two VMs, only one will be discounted.
>> Make sense.
>> Exactly.
>> It makes sense.
>> The discount is only applied to matching
number of VMs and the region number it says.
So we're in the purchase experience here.
You have to select the subscription for the purchase.
This is a subscription that we will build.
Also, this is, you
need to be an owner on this subscription.
>> Okay. That make sense.
>> Once you select the subscription,
the second item here is scope.
There's two values for scope.
One is ''Shared'', the
other one is ''Single subscription''.
I'm logged in as an enterprise customer.
If I select ''Shared'',
then this reservation is going to apply across all of
my subscriptions in the enterprise agreement.
So, it really optimizes the usage for this reservation.
If I'm not using it, someone else is using it.
It guarantees that, or it increases
the chances of complete utilization of my reservation.
>> Yeah, absolutely.
>> I can also select single subscription here.
In that case, this reservation
is only going to apply to my subscription.
>> Okay.
>> The next selection here's "Region",
you can select any of the regions.
I have two regions which are recommended here,
that is based on my usage over last 30 days.
V analyzer usage.
If you use consistently VMs in a particular region,
only then do we recommend that region for the purchase.
>> Okay, that's a really good point.
Those recommendations are personal.
You're not trying to push me towards Central or East,
you're literally saying you use
things in Central and East. This would benefit you.
>> Absolutely. Yeah. V are not upselling you,
V are trying to save as much money as we can for you.
So we run all the logic here and V tell you
that V think that you will save
most money by looking at your usage.
>> Okay.
>> So, I selected East US.
In East US, I have this VM running.
>> So, this is even nicer, and then you also
recommend the size based on usage.
So, you know where I'm running
things and you know what I usually use,
so you're already showing me the best way to save money.
>> Yes. V can look at that data and
will try to make your task simpler.
So, D2s_V3, we select that region, the size.
Now, the term values are one year and three year here.
I'll select three-year term,
your discount increases as you go for a longer term.
>> Oh, really?
>> I will give a quantity,
let me give quantity one here.
That's the recommended quantity
because I'm just running one VM here.
>> Okay. Sometimes it
can be a little confusing when I see
like things like VM size,
like D series and E series, and all that kind of stuff.
I would find it on the pricing page to
learn which VM is right for me.
>> Yes. In the pricing page,
we cover all the VM series there.
>> Okay. So, let's just popped up the price,
and it said I can save 57 percent.
>> Yeah, that's on this size.
>> On that size.
>> I can also go and change the size
to a different value here,
so let's select this size
and we'll just go do a calculation.
We'll look at your pricing,
this specific pricing for you,
and then we'll figure it out what's the discount.
In this case, the discount is 70 percent for me.
>> Wow, okay. This is where it happened to be
an Australian subscription right
now, so we are seeing AUD.
>> Yes.
>> Is that cost per VM for that full year,
so I just pay that one price for the full year?
>> This is for three years.
This is what you're going to pay.
>> Then, it's for three years.
>> This is for three years.
>> Oh, wow.
>> You're going to pay 744 right now,
and for next three years you will
not be charged on demand for
one D1_v2 VM running in East US.
>> Oh, wow.
>> No on demand charges.
>> Like you said if I did a shared
across my subscriptions,
I could maybe go and say 10.
>> Yes.
>> Then, other people who are
admins on that subscription or people who are
involved in that subscription as long as I've got
10 of this VM size in that region being used,
the first 10 are paid for.
>> That's correct. So, we will look at your enrollment.
This is an enterprise customer here so we'll look out
your enterprise agreement and
all the subscriptions under that,
and then we'll discount up to 10 VMs there.
If you were a WebDirect customer,
then we will look at your account only,
and then in that account,
we will see what are the matching
VMs and we'll give you discount on that.
>> So, you say of WebDirect customer.
>> If you are a credit card customer.
>> So I'm a WebDirect customer then?
>> Exactly. Yes.
>> Okay.
>> Yeah. So in that case, it will be the account scope.
>> That's really cool. It makes me feel
good about my rental car analogy
because I could have a fleet of
reserved virtual machines prepaid,
and I could have anyone on my team use
those and my costs are fixed,
my costs are understood.
What happens though in three years and one day?
Does my VM disappear?
>> No. Nothing happens to
your VM. This is a billing benefit.
Your VM will just stay intact.
We will bill for your VM on
on demand rates after that duration.
>> I see. So if I do nothing,
it just goes back to regular billing?
>> That's correct.
>> But I assume I could then maybe
lease it for another three years.
>> Yeah. You could absolutely purchase again
for three years, one year, whatever you want.
>> That's pretty cool. Now, I noticed that some
price where you did one size and it was 50 percent,
you did another size it was 70 percent.
So, discounts, they depend on what?
On region, on size, on operating system?
>> Yes. Exactly, those two things: region and the size.
Operating system is not discounted by reservation.
The reservation only applies on the compute usage.
>> Oh, good to know. So it doesn't matter
what I run whether I run Linux or Windows,
it is about the size and the location.
>> Yes, the discount is on the compute,
operating system will be charged separately.
However, you can combine
the reservation discount with Azure Hub benefit.
>> Azure Hub.
>> Yes. If you have a Windows license
with software assurance,
you can apply Azure Hub on the VM,
and that will increase your savings to up to 80 percent.
>> I see. So that's when I have an enterprise where I
have on-premises Windows server licenses.
I've already paid for those licenses,
I've got software assurance,
I then apply those licenses into the cloud.
So, if I have a hybrid situation,
maybe I'm going to lift and shift a bunch of
virtual machines that are sitting under someone's desk,
I can go and maybe reserve 5 or
10 apply those licenses and save even more.
>> Yeah. You can combine reservations and
Azure Hub benefits and
increase your saving to up to 80 percent.
>> Up to 80 percent.
>> Yes.
>> That's like yeah, that's crazy.
I really enjoy doing
Azure Friday and learning about stuff
like this because I literally after the show,
people know that I'm not joking,
will go and do this to my own account and save
money myself because I pay for my Azure myself.
I don't have like free Microsoft employee Azure money.
For my own personal account,
it's my own thing and my own side stuff,
and learning stuff like this makes me very happy.
So under pricing, does this show up
under pricing when we go and look at this online?
>> Yeah. So, this is the Azure.com pricing page.
Here, I'm down to the region and the operating system,
and these are the VM sizes,
and these are the preservation prices.
>> So, this is the regular pricing page,
this is not a special page for reserve instances.
So here in the regular pricing page,
I can go and see almost 10 cents an hour,
but I can go even down to
four cents an hour and one year reserved or
almost two cents an
hour on the three year reserved, 72 percent off.
>> Yeah. You can see it all in the pricing page here.
>> Has this been integrated into the pricing calculator?
>> Yes, I have it here.
So, if you go to Azure pricing calculator,
you can again enter the region and the VM
and you can see the discount percentages there as well.
>> Very cool. So, you've got
this good sized virtual machine
with a lot of temporary storage and this is a D1,
so this is not an S,
this is a little bit better VM?
>> Yeah.
>> This got us down to 18 bucks a month.
So that discount for
a much more powerful VM than the S that I'm paying
for is cheaper than
the S that I'm paying for if I
go and buy it for three years.
>> Yeah.
As the calculator says,
you'll get a 72 percent discount on this,
and it depends whatever VM you are comparing with.
>> But what's exciting about it,
and why I'm using S an example,
is I have a budget of
about 20 bucks a month for this virtual machine,
and now I can get
more VM for the same price if I reserve it.
>> Absolutely.
>> Fantastic. So this is available now?
>> Yes. The VM live and you can go and
purchase that from the Azure portal yourself.
>> Fantastic. I am learning all about
how to save huge amounts of money on my Azure
compute with Azure Reserved Instances
today on Azure Friday.