Azure Savings Plan for Compute: What You Need To Know

Saving money is a common goal for individuals and businesses alike, whether it’s in everyday grocery shopping or managing cloud expenses.

Fortunately, Azure offers a range of tools and best practices to help you cost and size your resources efficiently within the cloud environment.

One of these tools is the Azure Savings Plan for Compute. It was introduced in October 2022 and has proven to be a valuable asset for cost savings. In this post, we’ll delve into the benefits of the Azure Savings Plan for Compute, explore its significance as a cost-saving solution, and highlight any potential issues you should be aware of when using it.

What is Azure Savings Plan for Compute?

The Azure Savings Plan for Compute is a new pricing plan that grants eligible customers reduced prices on select Azure compute services in exchange for a commitment to spend a specified hourly amount. The plan offers a flexible and hassle-free way to save up to 65% on compute service costs compared to pay-as-you-go prices and can be applied over a one-year or three-year period.

Unlike reservations, Savings Plans offer a greater level of flexibility when applied to relevant Azure services. However, to avoid any wastage of resources, it’s crucial to ensure that the Savings Plans are assigned correctly.

If you’re a Microsoft Customer Agreement (MCA) or Cloud Solution Provider (CSP) customer, you’ll notice that the prices for savings plans are showcased in US dollars. However, customers with Enterprise Agreements (EA) will see the plans listed in their local currency.

Furthermore, you can choose to pay the total commitment amount upfront or monthly with no additional fees. Unlike Azure Reservations, the savings plan commitment can be applied across multiple Azure regions.

What services are eligible in Azure Savings Plan for Compute?

The Azure Savings Plan for Compute covers compute services across all Azure regions, enabling you to benefit from discounts on the following services:

  • Azure Virtual Machines
  • Azure App Service ((Premium v3 only)
  • Azure Dedicated Host
  • Azure Container Instances
  • Azure Functions Premium plan

Purchasing a savings plan is a cost-effective solution if you have consistent compute spending across multiple regions as it immediately qualifies your compute usage for the discount, reducing your costs.