
Microsoft Azure: Cutting prices on compute and storage - panarky
http://blogs.msdn.com/b/windowsazure/archive/2014/03/31/microsoft-azure-innovation-quality-and-price.aspx
======
jtchang
Hate on Microsoft all you want but this is a great thing. If Microsoft feels
they want to play in the infrastructure as a service game they need to earn
the customer's trust.

Price matching is certainly one way to do it. Azure does run linux by the way
(a lot of people don't know that).

One thing I've been going back and forth about is whether I "trust" Google App
Engine or Microsoft Azure more. Both are juggernauts but Microsoft seems very
intent on staying and competing in this space.

For what it's worth I've used Azure before and don't find the interface too
bad. Also for spinning up the latest and greatest Windows Server instance you
can't really beat Azure.

~~~
yulaow
Also with Bizspark you can have, if I remember well, like 150E/month to spend
on azure for 3 years.

Considering that almost any IT startup can access to bizspark, it is a nice
thing to at least try it.

Also I love the fact they are distributing their sdks for other os (linux and
osx) and that they are all opensource on github

~~~
city41
It's also worth pointing out that BizSpark imposes no requirements or
obligations on the startup. You are free to join BizSpark and never use any of
its services and you don't owe MS anything at all.

~~~
sachinag
They got rid of the $100 thing?

~~~
martydill
Yup, graduation is now completely free.

------
iambateman
<rant class="disgruntled"> I've used Azure's cloud hosting in production for a
half dozen sites and I have to say it's driving me nuts.

We tried to flip DNS to Azure and it wouldn't resolve. It took our senior
developer two days of talking to Azure support to solve. Ended up being their
fault.

Today I ported some work using PHP's mail() function, which evidently Azure
doesn't support?

This is probably our own fault for switching environments but we've moved
sites from Media Temple and GoDaddy to Azure and consistently had problems.

Needless to say, a price drop isn't making me any more excited about Azure.
Their UI is convoluted (though beautiful, for sure) and I've had nothing but
issues with it. </rant>

~~~
marshray
If you (or anyone in the this thread) would be so kind as to write up a
description of some specific functionality or interactions that we can improve
and email them to me (m/a/r/a/y at microsoft dotcom) I would appreciate it. I
can't promise instant gratification results, but I will do my best to get your
feedback to the right person.

Thanks :-)

~~~
ravibhatt
I can give some point here: (A cluster below is hadoop cluster)

\- Machines reboot without any notifications. \- Blob storage gets throttled (
i was told by a support staff) and at times become unreachable. \- Some
clusters i create, go into "Operational Mode" in that beautiful UI. and there
is no way to delete that cluster! \- At one instance, a cluster failed
because, i was told, some internal azure tables got deleted! \- Start up time
(for PasS) for a cluster is 13+ mins regardless of how many machines you have
in it.

------
nlh
Yet another example of competition working out well for the consumer.
Innovation, price drops, etc.

Can you imagine a world where consumer broadband had the same level of
competition? Sigh...a nerd can dream...

~~~
venomsnake
It is called Eastern Europe - 100Mb/s for 20 euro a month with static IP and
no traffic limits.

Also we have right now large fiber to the home deployments.

~~~
deviltreh
100 mbps for 20 euros? That's quite a lot, for 28 euros I get 300 mbps outside
of my country and gigabit inside.

~~~
ithkuil
Country or ISP network?

~~~
deviltreh
[https://www.skynet.lt/](https://www.skynet.lt/) Lithuania

------
panarky
Microsoft created an entirely new instance type to match EC2 prices,
ostensibly because EC2 instances don't include load balancing.

And the performance of the new "basic" instances will be reduced:

    
    
      Basic instances will have similar performance characteristics
      to AWS’s equivalent instances while the Standard instances
      will maintain their favorable performance.
    

Anyone know how "favorable" Azure performance is on their standard instance
type?

~~~
snorrk
Apparently some studies have shown that Azure has "3X better price for
performance than Amazon EC2"

[http://www.scribd.com/doc/146167581/Cloud-Computing-
Performa...](http://www.scribd.com/doc/146167581/Cloud-Computing-Performance-
a-Comparative-Analysis-of-5-Large-Cloud-IaaS-Providers)

Additional curated information can be found at:
[http://www.windowsazure.com/en-us/campaigns/azure-vs-
aws/](http://www.windowsazure.com/en-us/campaigns/azure-vs-aws/)

------
sytelus
I still don't know why people find these "low" prices exciting. A most minimum
spec VM in cloud still costs $380 _per year_. Considering these providers have
advantage of scale plus load balancing ability, the cost should be 1/10th of
this. I was looking for new host for my site and after I looked at Azure/AWS,
I was floored how expensive these things are. Cloud prices had been riding in
clouds for quite sometime. It has now came down but it's still way up there.
The low margin claims by cloud providers is pure bullshit. The fact is that
all of these people could have lowered their prices for quite sometime but
they just chugged along until there was competitive pressure. Eventually,
someone will become monopolist in this area and they would have free ride and
all of these guys are in game to become that monopoly.

~~~
nl
_A most minimum spec VM in cloud still costs $380 per year._

Not sure where you are getting that. On Azure, it is $16 _12=$192 /year[1]. If
your "in cloud" means other large providers as well, Digital Ocean will do it
for $5_12=$60/year[2].

If you are prepared to go with smaller providers, then a very quick look
around finds providers at $5/year[3].

I've worked on pricing at a large (enterprise) hosting company and I can
assure you the "low margin" claim isn't "pure bullshit".

 _The fact is that all of these people could have lowered their prices for
quite sometime but they just chugged along until there was competitive
pressure. Eventually, someone will become monopolist in this area and they
would have free ride and all of these guys are in game to become that
monopoly._

Don't these two claims conflict with each other? Prices are dropping _because_
of competitive pressure. If someone _will become monopolist in this area_ AND
margins are as high as you seem to think, won't it be simple for another
provider to enter the market with slightly lower prices and take market share
from the incumbent monopolist?

[1] [http://www.windowsazure.com/en-us/pricing/details/virtual-
ma...](http://www.windowsazure.com/en-us/pricing/details/virtual-machines/)

[2]
[https://www.digitalocean.com/pricing/](https://www.digitalocean.com/pricing/)

[3] [http://lowendbox.com/](http://lowendbox.com/)

~~~
berns
No low margins at all. Don't forget the bandwidth pricing. No low margins
there at all. Digital Ocean includes up to 5 TB of free transfer. That would
cost $614 per month at AWS. Not to mention dedicated server providers like OVH
where you can get a modern Xeon and unmetered 300 Mbps bandwidth for $ 137 per
month.

Edit: typo

~~~
nl
Bandwidth pricing is a _very_ murky field.

I've worked on CDN pricing, too, although mostly outside the US market.

Depending on who you are, in some circumstances you can actually make money
from cross connect charges. This is typically the case if you are a telco, but
it depends on your place in the market.

You can see some hints of this in the differing ingress and egress pricing on
AWS.

Anyway: Yes, AWS bandwidth is expensive and most people would be better off
going elsewhere if you are using a lot. But don't be too quick to judge the
margins because we have no way of knowing what Amazon pays under what
circumstances.

------
JeremyMorgan
Very nice!

I think Azure's biggest hurdle so far is the association with Microsoft and
people assuming "well it must be expensive" only to be proven right when they
sign up.

That being said, some parts of Azure are pretty cheap and for small site it's
affordable as it is now. You can get 10 free websites and a couple decent
sized databases for around $40 a month which gives you better service and
scalability than you would get from a hosting provider at $40 a month.

If you're running a business or have some real traffic though, expect to pay
considerably more for the service. It can really expensive, very fast.

~~~
patja
The biggest unexpected fee I found in my comparison shopping was the $39 /
month fee to support IP address SSL on Azure Websites.

~~~
martinald
Yes, definitely. This is a really annoying drawback of Azure websites, because
apart from that it is a really good little service for lighter loads. We've
found great success in using it for API services and the like that get little
traffic, but could do with being separated out from the core website.

It's actually worse than it just being $39/month, because you can't use the
free or shared tiers, which is even more annoying.

Azure peeps: please change this! It makes it very hard to justify using Azure
websites when you could just get your own VM and install an SSL cert on that
with no restrictions for lot less.

------
justinlink
I don't understand why Microsoft doesn't drastically reduce the price of their
Windows instances.

Microsoft is matching all of AWS prices, which means the Windows servers are
more expensive than the Linux servers. Why not set your Windows server prices
as the same as your Linux servers since you don't have to pay the licensing to
yourself. This would make azure the easy choice for those running Windows
servers.

Maybe I'm missing some anti-competition law here or something, but it sounds
funny that Microsoft is price matching Amazon's prices on Microsoft Windows
Servers.

~~~
matthewarkin
They do have to pay licensing, its money that goes from one business unit to
another within the Microsoft Corp, thus to not destroy the Azure budget, they
pass the license costs to you instead of eating it.

~~~
nnq
It's not as if one business unit can't give a "90% discount" to the other if
the grand common leadership thinks it's a good idea... now, that would be
anticompetitive to all other hosting providers, but it would makes sense as a
tactic in the "great war against *nix" that they are 100% loosing on the
server side :)

------
davidbanham
FYI, Azure runs Linux but does so on a Windows host.

Whenever Windows needs a security update, it has to be rebooted.

This means you need to plan for your Linux VM to go down weekly.

~~~
leddt
In my experience (running a Windows vm) the forced reboot is more like every
two months. Also they have a feature called availability sets where you can
load balance two VMs and they guarantee that one of them will always be up.

Edit: Looking back at my email history, it's much less often than that. The
interval between the previous two reboots was 6 months. They also gave about
two weeks notice when it happened.

~~~
shuffle2
I just had this happen recently and there was no warning. Perhaps it depends
on the "level" of services you are using. My instance was just an "extra
small" vm.

~~~
davidbanham
Back when we were using Azure heavily, the answer from the Azure team members
I was talking to was that they had no mechanism to warn me when the machine
was going to go down.

The primary workload we were running was video game servers. The server stores
all state ephemerally in RAM tied to the process. When it goes down, that play
session is over and all players are booted. This was just a constraint of the
software that we had to live with.

What I was looking for was some kind of heads up so that I could at least try
and take down the process gracefully, but that wasn't possible.

As said, this was a while ago. Hopefully the situation is now different.

------
jw2013
It's interesting that MSFT has already reduced Azure's price early this
January to counter the price reductions by AWS back in January. And also in
April 2013, MSFT responded AWS's price drop with 21%-33% Azure price
reduction.

Are we in the era of cloud price-bidding war? And the ultimate beneficiary are
us the users.

~~~
lelandriordan
Yes. MS said that they would match any AWS price change.

~~~
yulaow
We have to hope they never form a sort of cartel or join an informal alliance.
Until now we are really getting a lot of benefits due to this competition

~~~
euank
I can't help but think that they already were in a sort of informal alliance.

It took Google dropping prices for both AWS and Azure to drop... clearly they
were both skimming profits off the top for the last while.

Of course, a company does need to profit and I'm not accusing either of them
of doing anything wrong, I'm just trying to say that these sorts of alliances
form accidentally and naturally; both companies hit a competitive price and
then hardware gets cheaper; software gets better... they could drop prices,
but why cut into profits when there's no need? Inertia is a powerful force. It
takes something actually happening to kick those price drops into action,
generally.

~~~
_delirium
> these sorts of alliances form accidentally and naturally

The airline-ticket market is kind of fascinating to watch from that
perspective. On directly competing routes major carriers often end up with the
same fares and matching each others' moves, but the exact process of who leads
and who follows is complex. There is all kinds of informal signalling where
companies attempt to figure out the others' intentions without directly
colluding. For example, a company might trial a $50 fare increase in response
to increasing costs, and hope others will match it. If others don't, they
might be forced to roll back the increase to avoid losing market share,
admitting the trial was unsuccessful. It's in effect an offer of, "hey
everyone, I think we should raise prices $50 on this route, do you match?",
followed by "ok, I guess not, retracting" if they don't, but not explicit.

------
mason240
They really need to cut prices. I created a card-lookup site for a collectible
card game ([http://www.lotrlcg.com/](http://www.lotrlcg.com/)).

Originally it was written in PHP and was on regular shared hosting through
InMotion Hosting for about $5/month.

I rewrote it in ASP MCV and hosted it through Azure and they are charging
about $20/month - a jump that I was not expecting. The convenience of being
fully integrated into the MS stack is great, but I was planning on moving
everything with project I start. Hopefully the price difference will be good
enough to stay.

~~~
bananas
$5 to $20 doesn't even raise itself above the noise for most people. The net
gain for deployment with web deploy is enough on its own.

------
apapli
I lost count of the times they mentioned Amazon or AWS in this article. This
is going to be exciting, Microsoft are really gunning for them.

Interestingly it looked like the price comparison tables were based on on-
demand pricing. Does azure have something similar to AWS's reserved instance
model?

~~~
bskap
Yes, it's just a percent off the on-demand pricing instead of being priced
separately. Details at [http://www.windowsazure.com/en-us/offers/commitment-
plans/](http://www.windowsazure.com/en-us/offers/commitment-plans/)

------
sadfaceunread
Microsoft has always been terrible at branding. Is it 'Microsoft Azure' or
'Windows Azure' it is both ways multiple places on their site.

~~~
marshray
The change to 'Microsoft Azure' was announced 6 days ago
[http://blogs.msdn.com/b/windowsazure/archive/2014/03/25/upco...](http://blogs.msdn.com/b/windowsazure/archive/2014/03/25/upcoming-
name-change-for-windows-azure.aspx) beginning 3 days from now.

So, yeah, it's in transition.

~~~
chetanahuja
I'll just shamelessly copy my own tweet about the branding problems of Azure

"It took them too long to understand that the Windows brand is tarnished
forever. I propose ditch "Microsoft" too. Just "Azure"."

~~~
hhandoko
I think it's more to do about branding consistency. Azure is far more than
just 'Windows' now, you have: Media Services, CDN, Mobile Services, Cache,
etc.

------
diziet
The lack of beefier instances is a bit tough to handle -- the largest memory
machine is the A7 at 56gb, compared to a cr1.8xlarge at 244.

------
amits89
This is a great strategy by Microsoft and it's part of "1st Mobile & 1st
Cloud" strategy which is being adopted by Microsoft New CEO. As Nokia X came
into market where user will get 7 GB of free cloud & this will increased upto
10 GB if user allow camera access to the cloud. Cut-throat competition is
about to begin in cloud market, each and every player are ready to compete
with attractive offering.

------
simonmd
Yeahhh, if Rackspace would just go ahead and follow AWS,Google and Microsoft,
that would be grreat...

~~~
Patrick_Devine
Does anyone else feel like Rackspace is just getting left behind in the IaaS
business? Their prices and services offered is getting out of whack compared
to everyone else.

------
afhsfsfdsss88
It would just feel so dirty running a *nix vm on a Windows Server
host...DIRTY.

~~~
camus2
makes little sense,but they'll end up running unix themself one day,dont
worry...

~~~
rbanffy
Many decades ago, Microsoft had Xenix. It was a very competent Unix-like OS at
its time.

No. Not really. But it was what was possible to run on PCs at that dark age.

------
mandlar
I really wish they would have included some price cuts on the web site
services.. Or at least give us an extra small instance for standard web sites.
Scott Hanselman said it was "coming soon" back in August:
[http://www.hanselman.com/blog/PennyPinchingInTheCloudWhenDoA...](http://www.hanselman.com/blog/PennyPinchingInTheCloudWhenDoAzureWebsitesMakeSense.aspx)

------
jroseattle
This is a good thing, but I wonder how this will affect people like Digital
Ocean, Rackspace, etc.

Still, this is a really great thing. Competing on price and/or features will
only improve the environment for everyone. Probably not quite a race to the
bottom, but there are deep pockets involved in the AMZN/GOOG/MSFT collective.

I expect all the management tools to start to get a _lot_ better.

------
chetanahuja
Seems like someone at Microsoft is reading this thread. In that case, an
incubator I'm involved with (Tandem Entrepreneurs in the bay area) would like
to get that sweet incubator deal if it's still on. We're already on a similar
deal with AWS.

And ahem, Google cloud folks if you're reading this... you know what to do.

You can email me at my username at gmail

------
dalek2point3
does anyone have a link to the usability of AWS v Google vs Azure? I'm looking
to setup a personal server for all kinds of data wrangling, personal projects,
websites etc. Im wondering what the most cost effective solution might be.

------
allochthon
I feel like this is one of the few times where I've seen capitalism work
clearly and unambiguously along the lines that Adam Smith had in mind. I'm
deriving something approaching mischievous glee.

~~~
encoderer
I don't know, I see it every week a block from my house. Chevron drops the
price of gas twenty cents and before the end of the day the citgo across the
street has dropped theirs 21 cents.

Of course when one raises prices, the others follow right back up.

------
TomGullen
Why are all the cloud services suddenly dropping so dramatically?

Is this a dramatic shift in strategy/tactics from the sector, or is it a
cartel popping?

~~~
amaks
AWS and Azure are getting defensive against Google's price drop:
[http://techcrunch.com/2014/03/25/googles-cloud-platform-
goes...](http://techcrunch.com/2014/03/25/googles-cloud-platform-goes-on-the-
offensive/).

------
dantiberian
Steve Martin comes off as oddly defensive when announcing these changes

    
    
      I’ve yet to meet a developer who travels just to hear about pricing updates,
      so you won’t see us take the stage at Build and use the opening moment 
      to announce a price cut. This isn’t retail; innovation matters. 
      I’ll cover pricing right here, right now.
    

I'm not sure what purpose it serves except for making a stab at Amazon and
Google.

~~~
outside1234
I think he makes a valid point, why waste keynote time on prices? I'd much
rather hear about the innovation.

~~~
dantiberian
It's a valid point but phrased oddly. He could have said something like:

"We have so much amazing stuff to tell you at Build that we won't have time to
cover price drops on Azure. Effective May 1 ..."

------
marek1985
Azure is the right thing...

------
dudus
Ah, image tables, why use <table> when you can just add an image right? And I
bet these tables were drawn in Paint. You can clearly see that in the first
table the borders don't even match (bottom left).

Am I the only one that gets annoyed with this?

------
opendomain
I am a Microsoft fan, but they are doing the cloud all wrong. To setup Azure,
you have to use silverlight. To access the servers, you use remote desktop.
Microsoft office 365 is $100 PER YEAR - much more than I would pay for the
full suite (over 4years of average use) If you want to use SQL server, expect
to pay $$$ - and integration or reporting services are not included. There is
another feature that is actually nice: if allocate one server, you get 5 extra
services automatically, including active directory, block storage, and network
setup. if you do not know each part of the cloud, this helps you out, but it
is done the "Microsoft way" and can be confusing compared to other cloud
services.

~~~
spo81rty
They changed the portal a whole back and silverlight is no longer used. I
hated it too. New one is very nice.

~~~
MartinCron
Please forgive my accidental downvote. I intended an upvote.

