Reserved instances provide an easy way to reduce the cost of your VM machines by up to 72% when compared directly to pay-as-you-go – not bad! So what’s the catch? Well there isn’t one really although you do have to make an upfront commitment to Microsoft for one or three years. It is important to note that the discount only covers the VM and will not discount networking, software or additional software if you’re running a Windows VM it’s worth looking into Hybrid Use Benefits to help with the licence costs of Windows – you can use Hybrid Use in conjunction with Reserved Instances to even further reduce the cost of the VM.
So can I get one?
In short – yes! You’re eligible for a Reserved Instances if you have an enterprise agreement in place with Microsoft, a PAYG subscription (you must be the owner of the subscription to purchase) or are a CSP (Cloud Solutions Partner).
How will I be billed?
If you have a PAYG subscription the credit card details saved to your account will automatically be billed for the amount owed but if you’re billed by invoice you won’t see the charge until the next invoice is received. If you have an Enterprise Agreement in place with Microsoft and have an annual commitment balance the amount owed will be deducted from the balance. It’s worth nothing though that if the balance isn’t enough to cover the commitment you will be billed for the outstanding amount.
So how do I set it up?
Simple! When you’re in the Azure Portal, Select All Services > Reservations, Select the Reserved Instance. You will be greeted with a “Purchase Now” button.
From the “Create reserved VM instances” blade you tell Microsoft what subscription (you can either tie the reserved instance to a subscription – useful if you have a subscription per department for recharge for example or shared across multiple subscriptions – useful if you have a simple Azure setup). Microsoft helpfully tells you which regions it would recommend purchasing the reserved instances for and the number of reserved instances per VM size along with specifying the term (one year or three years).
And that’s it – simple but a great way of massively reducing the costs of your VMs