Thursday, December 22, 2016

What is the correct price?

One of major pain points for SMB resellers is pricing Azure solutions. Here’s an example of why.

Let’s say that I want to price a DS1_V2 machine.


In this case I’ve chosen a DS1_V2 machine for a couple of reasons. Firstly, it is a low power machine, and secondly, the DS machines allow the attachment of premium storage.

Now as you can see from the estimate from inside the Azure portal above the price of this machine alone comes to $79.60 per month.


Interestingly, if I now go to the Azure price calculator I don’t find an option for a DS1_V2 machine, so confusion point number one. It turns out that I need to use the pricing for a D1_V2 which is the same as the pricing for a DS1_V2 (but of course the DS1_V2 permits premium storage while the D1_V2 doesn’t).

Confusion point number two is that the price for a D1_V2 (which is the same as my desired DS1_V2) is listed as $139.30 per month. So what’s the right estimate here? Sure, the difference in price is only about $60 but as a percentage the difference is about 75% which is significant.

Let’s try another machine.



The difference in a D2_V2 is $119.40 or again a 75% difference.

Let’s try another family of machines.



The difference in an A1 machine is $69.17 or 182% difference!

So clearly I’m missing something here and would appreciate someone setting me straight as to:

1. Why the pricing between the portal and calculator is different and

2. Which one I should be using to get a correct estimate of cost?

I need to know.

**** Here’s the answer:

Because I have Azure via an MSDN subscription I received additional discounts on VM usage per:

Low dev/test rates help you stretch your credit farther

Use the Microsoft software included with your Visual Studio subscription on Azure Virtual Machines for dev/test at no extra charge—you’ll just pay the Linux rate for VMs you run, even VMs with SQL Server, SharePoint Server, or other software that is normally billed at a higher rate. Upload custom virtual machine images yourself or use one of our pre-configured images from the Azure Gallery.

In addition to the low dev/test rates on VMs, you also get low rates on Cloud Services, HDInsight, and Web Apps.

So now I know. My oversight!

So in summary the Azure pricing calculator gives you the RRP without any discounts while the portal gives your effective costs taking into account any discounts you receive on that tenant alone! Thus, for pricing a solution for a customer, always use the calculator pricing.