Microsoft Introduces Cost-Cutting Azure Backup Billing

Microsoft aims to make cloud backups more enticing for enterprises with a new pricing model and a choice of storage locations.

Azure cloud backup

Microsoft is changing the way customers are billed for Azure Backup, the company's cloud-based data backup offering, in a move that can help lower the cost of protecting their data.

"Today, we are announcing three key changes to Azure Backup that significantly decreases the [total cost of ownership] for customers storing backups in Azure," Aashish Ramdas, a program manager in Microsoft's Cloud and Enterprise division, wrote in a blog post. Those changes include a pricing model "based on the number of machines being backed up" and Block Blob storage-based billing for both long- and short-term backup data. Customers can now elect to park their backups using Azure's Locally Redundant Storage (LRS) or Geo-Redundant Storage (GRS) services.

Under the new pricing model, Microsoft charges a monthly fee for Protected Instances, the number of machines customers backed up and the cost of storage consumed by those backups on Azure, explained Ramdas. For example, a small protected instance of up to 50GB can cost $5 plus $0.048 per gigabyte (GB) per month if a customer selects the Geo-Redundant Storage option.

Protected Instances can consist of virtual machines, Windows Server workloads (SQL Server, Exchange, SharePoint, Dynamics and the File Server) and Windows clients. Therefore, the more instances handled by Azure Backup, the bigger the bill.

Size also plays a role. "So a virtual machine of 500GB in size will be charged $10, while a virtual machine of 2000GB in size will be charged $40," stated Ramdas.

The new pricing plan also affects machines backed up to Azure by Microsoft's Data Protection Manager (DPM).

"Although the DPM server acts as a conduit for backup data flowing to Azure, you will be billed based on the machines that DPM is protecting," Ramdas said. "For example, if 5 Hyper-V virtual machines each having size 100GB are backed up to Azure Backup via an on-premises DPM server, then you will be billed $10 for each of the 5 virtual machines."

Prior to the switch, customers were charged based on the total amount of data stored by the service at a rate of $0.20 per GB per month above 5 GB (the first 5 GB per month were free). As before, there are no charges for restoring data, outbound transfers and storage transactions. The new pricing model, which goes into effect on April 1, "reduces the cost of backup for servers with larger amounts of data and accommodates backing up client machines," claims Microsoft on its Azure Backup pricing Web page.

The savings really add up for customers with long-term data-retention requirements, according to Ramdas' math.

Using a 100GB virtual machine with a daily churn rate of 1 percent (an additional 1GB of data backed up to Azure each day), daily recovery points and the LRS option as an example, businesses can end up paying less than a quarter of what the old plan costs ($20.70 versus $89.10 on day 360). "By the end of the year with 360 recovery points, customers get savings of 77 percent with the Protected Instance-based pricing when compared to the $0.2/GB pricing model," noted Ramdas.

Pedro Hernandez

Pedro Hernandez

Pedro Hernandez is a contributor to eWEEK and the IT Business Edge Network, the network for technology professionals. Previously, he served as a managing editor for the network of...