4 Common Obstacles To Managing Microsoft Azure Costs (And How To Overcome Them)

Microsoft Azure was a relative latecomer to the public cloud market: AWS preempted everyone in 2006, and Google GCP came next, in 2008. By the time Azure launched in 2010, the public cloud market had already grown to more than $24 billion.

Despite being third to the party, Azure had a key advantage: The Microsoft Office Suite was (and is) a go-to choice for corporate collaboration.

Not only did this make Azure seem like a seamless extension of their existing platforms, but companies with Microsoft Enterprise Agreements could get a discount for choosing Azure as their public cloud platform.

This, plus Azure’s ease of use, has propelled Azure’s rapid ascent toward the top of the market: While AWS still holds the most market share (about 33%), Azure is next in line at 22%, followed by GCP at 9%. In July 2015, Azure generated just under $10 billion in revenue; by July 2022, it cracked $100 billion.

But like all cloud platforms, Azure presents a host of challenges when it comes to billing. If left unaddressed, these challenges can destroy enterprise value: Inefficient code only grows costlier as you scale, and can make the difference between profitable and unprofitable customers.

Here are some of Azure’s most common billing challenges — and how you can overcome them.

4 Common Obstacles to Managing Microsoft Azure Costs

1. Multiple agreements 

Azure offers three different types of customer agreements: Enterprise Agreement (EA), Microsoft Customer Agreement (MCA), and Cloud Solution Provider (CSP) Agreement. Each agreement is priced differently:

Billing complexity arises when organizations have multiple active agreements at once.

Companies rarely plan to have multiple agreements, but they may merge with or acquire companies who have different agreements in place. Or, they might want to experiment with another type of agreement to see if it’s more cost-efficient.

Azure’s built-in cost management platform offers no way for companies with multiple agreements to unify the cost data associated with each.

At best, this requires additional manual effort to get a unified view of your Azure environment; at worst, it obscures cost insights that could impact the profitability of your customers and products.

CloudZero ingests billing data from all Azure agreements and combines it into a single, unified view. That way, you can get a clear, real-time picture of how much you’re spending on Azure without any additional manual analysis. 

2. CSP agreement limitations

Individual Azure subscriptions have resource limits, so it’s not uncommon for Azure users to have multiple subscriptions at once. Azure’s product documentation even suggests multiple subscriptions as a way to scale your Azure environment.

But multiple subscriptions presents a challenge for CSP users. Because of the extra layer of billing between CSP users and Azure — Azure bills the CSP, the CSP bills you — CSP users can only view their subscriptions one at a time.

To get a full picture of their cloud spend, they’d have to toggle between different views and manually record and analyze the data from each subscription.

CloudZero collects and combines billing data from all CSP subscriptions automatically. So, when CSP users log into CloudZero, they see their complete billing environment, including 100% of their subscriptions.

3. Omitted cost information

The invoice you get from Azure at the end of each month includes more than just your usage costs. It also includes additional costs like taxes, and discounts for which you’re eligible.

But Azure’s built-in cost tracking tool only shows you your usage costs. Additional cost items — positive and negative — are included in your invoice, but Azure doesn’t offer built-in functionality for absorbing them into your real-time usage costs.

CloudZero incorporates all billing data into the views we feed back to your engineering teams. Real-time usage data, including taxes, discounts, and whatever else might impact your Azure spend are all included in our cost data. 

4. Limited cost breakdowns

All cloud providers have a built-in cost tracking tool. But because cloud providers specialize in infrastructure delivery and not cost analysis, the built-in tools tend to be somewhat rudimentary.

Like AWS and GCP’s cost tracking tools, one of Azure’s key limitations is that it’s very difficult to break your cloud spend into custom dimensions.

Azure lets you break your spend down by tag (and even then, only one tag at a time), but if your organization didn’t tag consistently, you’ll get incomplete or inaccurate information.

CloudZero Dimensions organize your cloud spend according to whatever parameters are most important to you. Break down your bill by customer, product, feature, team — or whatever else you might want. 

Then, layer different dimensions to get even more nuanced views: How much it costs to support customer A’s usage of a freemium feature vs. customer B’s.

Refined Azure Spend At Your Fingertips

As markets tighten, it’s never been more important for organizations to have a unified view of what they’re spending and why. CloudZero makes it easy to see all spend from all cloud providers in a single view, sortable by whatever metrics are most central to your business.

Don’t get blindsided by billing complexity. to see CloudZero in action!

Author: Dustin Lowman

Dustin Lowman, a FinOps certified practitioner, takes no small pleasure in applying his English major’s sensibility to the SaaS world. Dustin also writes, performs, and records original music, and has never met a cardigan he didn’t like.