Optimize Costs in Azure SQL Managed Instance

The economic instability and uncertainty of the future has many organizations trying to find ways to cut costs in different areas of their business models. The search for a way to reduce spending is often never-ending even as the economic climate improves, and cost-aware customers desire a solution that maintains the quality of their current business processes.   

Azure SQL Managed Instance encompasses multiple capabilities that offer different ways organizations can optimize their workload costs without compromising quality and performance, allowing them to operate efficiently at a lower cost. SQL Managed Instance allows the migration of workloads from an on-premises environment to a fully managed PaaS cloud environment. Organizations can optimize costs in SQL Managed Instance with cost-saving benefits and capabilities, right-sizing, and realizing PaaS-associated savings.

Azure SQL Managed Instance encompasses multiple capabilities that offer different ways organizations can optimize their workload costs without compromising quality and performance, allowing them to operate efficiently at a lower cost. SQL Managed Instance allows the migration of workloads from an on-premises environment to a fully managed PaaS cloud environment. Organizations can optimize costs in SQL Managed Instance with cost-saving benefits and capabilities, right-sizing, and realizing PaaS-associated savings.

Cost-saving benefits and capabilities

Optimizing costs in SQL Managed Instance isn’t a one-size-fits-all situation—there are several cost-saving benefits and capabilities to take advantage of depending on your unique business needs. By taking advantage of these benefits, or better yet, using two or more simultaneously, you can achieve significant cost savings while optimizing your business operations.

One of these benefits is reserved capacity pricing, which allows you to commit to a reservation for compute resources for a period of one or three years to get a significant discount on compute expenses and effectively budget and forecast. By choosing the size of the reservation based on the total amount of compute used by your managed instance, you can lock in discounted pricing with an upfront or monthly payment.

Azure Hybrid Benefit is another benefit of SQL Managed Instance for customers that have an existing SQL Server license and active Software Assurance. By applying Azure Hybrid Benefit to your existing license, you’re only paying for the underlying Azure infrastructure, which can represent significant savings, up to 55%, over pay-as-you-go pricing on Azure. Azure Hybrid Benefit also provides a virtualization benefit that gives you up to four vCores of SQL Managed Instance for every 1 core of on-premises SQL Server. This is a key differentiator of SQL Managed Instance, as other providers do not allow you to use an existing license.

Another way to save on licensing costs is using a secondary SQL Managed Instance deployment as a standby for disaster recovery. If the secondary instance doesn’t have any workloads connected to it, you can designate the replica as a standby instance. In this scenario, you are not paying for SQL costs on the replica, only the compute, storage, and backups.

Finally, dev/test subscriptions reduce the cost of running and managing workloads in development and testing environments. Your instance is charged for the compute, storage, and backup storage, but not for the SQL License, resulting in up to 55 percent savings. Dev/test subscriptions can get lost in the sea of options, but the Azure Pricing Calculator gives you the opportunity to calculate your estimated hourly or monthly costs for SQL Managed Instance in a variety of different scenarios, including using dev/test subscriptions.

Rightsizing for your workload

Rightsizing with SQL Managed Instance according to your specific workload needs eliminates excess capacity and thus excess spending. One way to right size is choosing the appropriate SQL Managed Instance tier for your organization. The General Purpose tier is designed for the majority of workloads with typical performance requirements, while the Business Critical tier offers the highest resilience by using several isolated replicas and is ideal for workloads requiring mission critical performance and availability. Choosing the adequate tier for your needs ensures you are optimizing costs and not paying more than you need to.

The vCore-based purchase-model for SQL Managed Instance helps you right size by providing flexibility and control over your workloads. You can change compute, memory, and storage based on your workload needs, and adjust them as needed. The premium series and premium series memory-optimized hardware configurations available on SQL Managed Instance are accelerated by Intel® Xeon® Scalable processors. thus delivering higher performance for significantly less cost in comparison to the Standard series configurations, also available on SQL Managed Instance. It’s imperative to weigh the benefits and costs of configurations, then choose the one that best suits your needs.

Managing costs going forward

Optimizing costs when getting started with using SQL Managed Instance is crucial, but costs also need to be managed as your business moves forward. There are a few different ways to accomplish this, as well as tools provided by Azure to assist in cost management.

There are a few choices you can make to control and manage costs, including downgrading to the General Purpose service tier and choosing the correct hardware configuration for your organization, which was discussed above. These decisions influence the CPU and number of vCores you’re getting. When it comes to being cost conscious, it’s a good practice to downgrade and reduce in these areas as you can. Reserved storage size can also be reduced if possible in order to cut costs. You can also choose between four different backup storage options: locally-redundant backup storage (LRS), geo-redundant backup storage (GRS), geo-zone-redundant backup storage (GZRS), or zone-redundant backup storage (ZRS). Each of these backup options have different price points and capabilities, allowing you to choose the best option specifically according to your business needs.  You can learn more about specific resource limits and options you can make when deploying SQL Managed Instance at Resource limits - Azure SQL Managed Instance.

The instance start/stop feature allows you to save on billing costs by stopping your General Purpose managed instance when it’s not in use. When the instance is stopped, you’re no longer billed for compute and licensing. An instance can be stopped either manually or according to a predetermined schedule. This feature is currently in preview and restricted to dev/test subscriptions within the November 2022 feature wave, which you can enroll your managed instance in here.

Read scale-out is another feature that can assist in cost management, but it’s only available in the Business Critical tier of SQL Managed Instance. It allows you to offload read-only workloads to a secondary replica instead of running them on the primary replica. Another option is offloading to an auto-failover group readable replica, which is cheaper than migrating to the Business Critical service tier, but in this case the workload on the secondary will have a bigger delay on information availability. Any reporting or similar read activity that would normally slow your workload down and impact performance is now isolated in the secondary replica, leaving your primary read-write workload unaffected. As a result, your business can continue to run uninterrupted with no lost revenue.

Azure Advisor and the Azure portal are additional tools that can also help you manage your business costs. Azure Advisor is a personalized cloud consultant intended to optimize your Azure deployments and can be accessed through the Azure portal. It aligns to the five pillars of the Well-Architected Framework (WAF), including cost optimization. Using Azure Advisor, you can monitor and analyze your costs, then optimize and reduce your SQL Managed Instance environment with the cost recommendations based on identified idle and underutilized resources. By visiting the SQL Managed Instance section of the Azure portal, you can easily manage costs and apply different filters for various scenarios that apply to your business model.

The value of PaaS

SQL Managed Instance provides all the benefits of a fully managed Platform as a Service (PaaS), inherently reducing capital and operating expenses. A research study commissioned by Microsoft and conducted by Enterprise Strategy Group claimed customers realized significant operational savings between 40%-60% by migrating on-premises infrastructure to the cloud—a portion of which can be attributed to the benefits of PaaS. PaaS-associated savings also include built-in intelligent features at no additional costs, like automated backups, point-in-time restore, automatic plan correction, threat detection, and vulnerability assessment. These features provide an extra layer of security for your organization without costing an extra penny—in fact, those extra security features can even save you thousands if they help prevent a security breach.

Prioritizing cost optimization in your SQL Managed Instance environment enables you to do more with less and take your organization to the next level. There are so many available options that can assist you in reducing and optimizing costs that support a variety of scenarios and needs. It’s all about finding the benefits and tools that make the most sense for your organization and its requirements.

Learn more about optimizing your costs with Azure SQL Managed Instance by watching our on-demand webinar, “Optimize your costs with Azure SQL Managed Instance.”