Gartner Research

How to Purchase Microsoft Azure and Optimize Spend

Published: 25 April 2023

Summary

Microsoft continues to evolve its Azure purchasing programs and negotiated discounts as limited means to reduce costs. Sourcing, procurement and vendor management leaders purchasing Azure services should leverage increased reservation options and Azure Hybrid Benefits to fully optimize costs.

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Overview

Key Findings
  • Azure services are sold through different programs (e.g., MCA, EA), each with its own distinct rules. This makes it challenging for many customers to determine the best program for buying Azure.

  • Microsoft typically negotiates discounts only on commitments over $500,000 per year, but there are many other ways to reduce overall Azure costs.

  • Azure services have indirect and hidden costs that, if not fully assessed at first and throughout their life cycle, could considerably increase the total contract value of a client’s cloud consumption.

Recommendations

Sourcing, procurement and vendor management leaders negotiating contracts for Microsoft Azure services:

  • Optimize Azure consumption by selecting

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