Posted by: kurtsh | May 15, 2019

INFO: Consuming Azure as a capital expenditure (CAPEX)

Most people know cloud services to be an Operational Expense (OPEX) however did you know that it can be, under certain circumstances be a capital expense (CAPEX)?

Reserving your VM

As of November 2017, you’re no longer limited to an operational expenditure model in Azure. By using Azure Reserved Virtual Machine Instances (known as RIs) you can change your cloud payment model to a capital expenditure model.

This model works well for a number of situations. Imagine you’re deploying a web service that will require at least two VMs online 24/7 for the next year, with other VMs brought on-and offline as demand fluctuates.

In this situation, you could purchase two, one-year RIs. RIs are paid for upfront with a 1-year commitment and the longer you commit the more you save; this can mean cost-savings versus paying monthly. To respond to increased demand, you’ll still be able to finance other VMs on a pay-as-you-go basis.

If you commit to three RIs you could save up to 82% when compared to pay-as-you-go. That’s a huge saving, especially if you have access to the funds upfront.

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