Purchase a VM with Azure Reserved Virtual Machine Instances (RIs)

By Alex Bennett, Firebrand Training

One of the changes encountered when migrating to the cloud is the difference in the way we pay for the service.

On-premise you’ll tend to use a capital expenditure model: if there is a new service to deploy you will create a budget, get it approved and then buy the physical kit or provision the virtual machines. You will also have planned for peak and for future growth.

The money is spent upfront and if the figures are wrong or your service experiences unexpected growth you must ask the businesses for more money.

Even if your forecasts are correct, you’ll still have spare growth capacity that is idle until your application grows into it.

But once you migrate to the cloud, you’ll use an operational expenditure model where you pay for what’s used. This means you can size services around what’s needed at right now, instead of having to plan for the next one, two, or three years of growth.

You pay by-the-minute for the service and if a service is no longer required you can simply turn it off. This initially saves cash, in exchange for an ongoing monthly bill. But could there be benefits for paying for the cloud in the same way we pay on premise?


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.

How to buy an Azure Reserved Virtual Machine Instance

When you purchase a RI through the Azure dashboard, a VM will not be automatically started. Purchasing an RI is like obtaining a credit.

First, purchase an RI based on a VM type (take a look at this guide on Azure Families for more information). Microsoft will then look at your account or subscription for a VM of the same family. If found, it will apply your RI credit to that VM.

If you buy an RI for a VM family that you are not currently running, the credit will not be applied and you will not be able to take advantage of it for that billing period.

RIs can be purchased for use across an Azure account or a subscription. If you buy a RI for an Azure account, the discount it gives you can be applied to any VM in any subscription on that account. If you buy an RI for a subscription, it can only be applied to VMs in that subscription.


Exchanging or cancelling your Reserved VM instances

So, what happens if you purchase a three-year RI and no longer need it, or you want to change the RI family? Microsoft offer the ability to exchange or cancel RIs. Cancellation will incur an early termination fee of 12% (of the upfront cost) and will allow you to exchange your RI for a different type.


Are Azure RIs available for all VM families and Regions?

The short answer is no. RIs are available for all families except for the A-series, A-v2 series, or G-series.

There are also region restrictions, for example RIs are not available in the Azure Government, Germany of China regions. You can find a complete list of regions available on the Microsoft Azure website.


Do RIs offer a capacity guarantee?

RIs offer prioritised capacity but they do not offer a capacity guarantee. This means that if the Azure region that you wish to deploy a VM to is really busy you might not be able to deploy your VM and take advantage of the RI Credit – though this is rare.

How to learn more about Azure Reserved Virtual Machine Instance

You could make significant cost-savings if you are prepared to pay upfront for an RI. While RIs will not replace on-demand instances, we’re likely to see companies now investing in a mixture of Virtual Machine payment models to suit their needs; using RIs for predictable workloads and on-demand instances as they are needed.

For more information on the discount provided by Reserved Virtual Machines, take a look at Microsoft’s documentation.

Or for classroom tuition, the Azure Academy: Infrastructure and Networking covers Reserved Virtual Machine Instances purchases as well as pay-as-you-go services. Developed with Microsoft, this is not a certification course – instead, you’ll get hands-on knowledge of the latest Azure features, before they’re integrated with the official MOC (Microsoft Official Curriculum).

Comments (1)
  1. Can you get an RI of the Azure DevOps build agents?

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