Azure Cloud Pricing Falls Somewhere Between VPS and Dedicated

As you may have heard by now, Microsoft has just unveiled the official pricing for its forthcoming Azure cloud computing platform. Ever since its introduction at PDC08, Microsoft has been very coy about the pricing for Azure. They’ve always defaulted to the party line that Azure pricing will be “competitive” with other cloud offerings.

Today we learn exactly what “competitive” means.

According to the Azure Team Blog, pricing will be about $.12/compute hour, $.15/GB/month for storage, and $.10in/$.15out/GB for bandwidth. There will be additional flat monthly charges for using Microsoft’s “SQL Azure” (or SQL Server in the cloud). I won’t repeat all of the pricing details- they are easy to find on the web now- but I will provide some analysis of how Azure seems to compare to other “traditional” hosting options.

In my experience, there are 3 basic hosting types:

  1. Shared – You get a single website on server hosting many other people’s web sites. (Cheapest option, least control – pricing usually $5 - $15/month)
  2. Virtual Private Server (VPS) – You get a single Windows VM on a server hosting other people’s VMs. (More expensive than shared, less expensive than dedicated, complete control over OS configuration – pricing usually $99/month and up depending on server config)
  3. Dedicated – You get a single dedicated server that only hosts your web sites (Most expensive and most configurable option – pricing usually $200/month and up depending on power of server, quality of service)

With the introduction of Azure, there is now a 4th hosting type for .NET developers to consider:

  • Cloud – You get a single website on a “cloud fabric” that can be configured to run on 1 or more virtual “instances” (Most scalable and (perhaps) reliable hosting, little control over environment)

How does the cloud pricing compare to other hosting types? Let’s do the math for a “typical” website running a single Azure instance:

Hosting:  about $90/month ($.12/hr * 24 hours * 30 days)
Bandwidth: about $3/month (assuming 10 – 15 GB bandwidth)
Storage: < $1/month (assuming up to 6GB of storage)
SQL: $10/month (assuming 1GB “SQL Azure Web Edition”)

So that brings that the grand total for Azure hosting to roughly $100/month.

Of course, with Azure, there is no “flat rate.” Everything is based on actual consumption (except for SQL Azure), so if you use less bandwidth or less storage, your bill will be…relatively unchanged. That’s because the real bulk of your bill is tied-up in the “computing hour” charges, which will be at least $90 per month for a single Azure instance.

Where Azure’s “consumption pricing” starts to be an advantage is if you have “peak” processing times when you need additional instances of your application running for a short period of time. With Azure, you’ll only be billed for the additional instances for the time they are running, unlike traditional hosting that usually charges you for (at the very least) a full month’s service for additional hosting instances.

Azure’s Threat to Shared Hosting

Soon after the announcement of Azure at PDC08, the halls were buzzing with people wondering how this “hosting in the cloud” would affect “traditional” .NET hosting providers. Would Microsoft put great hosting companies like DiscountASP.NET out of business? How could shared hosting compete with all that cloud computing has to offer?

Now that we have pricing, I think it’s clear that shared hosting providers are safe. In fact, all existing hosting providers are probably safe from losing much business to the cloud as Azure seems to fit somewhere in-between Shared and VPS services:

  • Azure provides little control over the hosting environment, like Shared Hosting
  • Azure runs your “instance” in a dedicated virtual environment, like VPS Hosting
  • Azure is priced competitively with VPS, but it is significantly more expensive than Shared Hosting

What do you think of Azure’s pricing model? Is $100/month the price you would expect to pay to have your site run in a cloud environment? Or for that price, would you rather have the control that a VPS offers? Sound-off and then prepare for the official Azure launch this November at PDC 2009.


  • Todd,

    Actually, VPS hosting has become incredibly cheap (compared to a few years ago). I use and pay less than $40/month for a small business level plan. There are other companies out there that offer similarly priced plans as well (1&1 comes to mind).

    I hear Azure will be available to students through DreamSpark and small businesses through BizSpark, but there doesn't seem to be anything for hobbyists and bloggers who don't fit into those categories. With pricing what it is, I think I'll stick with my VPS and give Azure another look in a year or two.


  • @Kevin - I think VPS hosting pricing is a factor of configuration and "quality." The more powerful the configuration and the more engaged the support staff, the more you pay.

    I'm sure there are many VPS providers out there that will sell hosting for $40/month, but there are also many that sell shared hosting for < $5/month.

    In my experience, you start to find "tier 1" quality at around $99/month for VPS and $10 - $15/month for shared. And since Azure is being provided by MSFT, I consider it Tier 1 service, too.

    In the end, though, VPS priced or not, it's good to hear another perspective on Azure's pricing!


  • is there any sense in a hybrid ? i.e. GUI on discountASP shared but using Azure table storage? ..that means no azure compute time but very cheap storage, right?

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