INTRODUCTION – Managing Costs & SLA Service Cycles
Within this course, you will delve into the prominent factors affecting the cost of clouds and discover ways and tools to predict and manage them effectively. You will learn a great deal about service-level agreements (SLAs) in Microsoft Azure and how these impact decisions in the application-design strategies.
You’ll also discover how you can access and use preview services for planning. Thus it should leave you with knowledge and tools by the end of this module with which you will streamline spending on the cloud, design considerations for SLA, and make informed decisions regarding services.
Learning Objectives
- Learn about the Azure service lifecycle and how to access new upcoming capabilities.
- Calculate a composite SLA by using multiple individual SLAs.
- Identify SLA determinants beyond selecting service tiers.
- Understand that SLA serves a purpose and is important in cloud environments.
- Know most cost components and best practices of cost reduction.
- Estimate the monthly workload charges by using the Azure Pricing Calculator.
- Explain Azure purchasing options for its products and services.
- Use the Total Cost of Ownership Calculator to compare business costs on-premises with similar workloads in Azure.
KNOWLEDGE CHECK 1
1. Your company is planning on migrating to Azure cloud services. However, before this happens management requires some comparisons of the costs involved in using cloud services as opposed to an on-premises solution. What would be the first step you could take to provide this comparison information?
- Run the Total Cost of ownership Calculator. (CORRECT)
- Setup some resources in Azure as this is a free service.
- Assume that the cost of running workloads on Azure are similar as running workloads on-premises.
Correct: The Total Cost of Ownership (TCO) Calculator will absolutely help you to assess the migration to the cloud. This is a tool for calculating a cost comparison of workloads running costs in an on-premises datacenter and on Azure. Because it is certified by an external independent research company, any information gleaned from the use of the tool will have this added stamp of reliability before guiding your decision-making process.
2. You work for a large manufacturing company and are planning on moving to Azure cloud services. You want to avail of the best pricing Microsoft has to offer on their Azure services. Which Azure service should you purchase?
- Buy Directly from the web
- Through a Cloud Solution Provider (CSP)
- An Enterprise agreement (CORRECT)
Correct: Enterprise customers, as larger organizations, enter into an Enterprise Agreement (EA) with Microsoft. The agreement requires them to spend a certain amount per year on Azure for the next three years, usually payable annually. As an EA customer, you enjoy the highest levels of personalized pricing that provide optimum value, which is specific to how much and what services customers intend to use.
3. Your company’s development team create virtual machines for testing on a regular basis. These test machines are only used during certain times. In your opinion what is the most efficient way to save costs on virtual machines when they are not in use?
- Use virtual machines that are only chargeable when accessed remotely.
- Delete the virtual machines when they are not in use because once they are deleted, they will not incur any charges.
- Deallocate the virtual machines when they are not in use. (CORRECT)
Correct: When you deallocate VMs, all the data are preserved; however, the associated hard disks and data remain stored. Your costs for CPU or network consumption are removed, thereby keeping your costs lower and your associated resources available for future use.
4. True or False?
Azure Advisor helps you identify unused or under-utilized resources and can recommend unused resources that you can remove.
- True (CORRECT)
- False
Correct: Azure Authority identifies optimized unused or under-utilized resources within your cloud environment. It goes further in giving recommendations to sever these resources, hence better aligning the configuration with actual workloads and minimizing unnecessary costs incurred.
5. If you have a free trial subscription to Azure and you reach your credit limit during the trial period, what will happen to your resources?
- You can carry on and access existing resources, but you will not be able to create new resources.
- Your existing Azure resources are removed from production and your Azure virtual machines are stopped and deallocated. (CORRECT)
- The oldest resources will be deleted once the credit limit has been reached allowing you to create new resources.
Correct: Once you have exhausted the free credits included with your Azure account, any resources you had deployed will be taken out of production, and all of your Azure virtual machines will be stopped and deallocated. However, the data within your storage accounts would still be there but read-only. To regain full functionality, you can upgrade your account to a pay-as-you-go subscription.
KNOWLEDGE CHECK 2
1. True or False?
A service-level agreement (SLA) is a formal agreement between a service company and the customer. On Azure, this agreement defines the performance standards that Microsoft commits to for you, the customer. However, in order to view an SLA, you must have an Azure Subscription.
- True
- False (CORRECT)
Correct: To review service SLAs, there is no need for any individual or organization to have an Azure subscription. These public SLAs are available on the Service Level Agreements page on azure.microsoft.com, thus allowing anyone to delve into SLA specifics for Azure services.
2. Downtime refers to the time duration that the service is unavailable, how much cumulative downtime per year will an SLA percentage of 99.95 give?
- 3.65 days
- 52.56 minutes
- 8.76 hours
- 4.38 hours (CORRECT)
Correct: An SLA percentage of 99.95% actually translates to an approximate maximum possible annual cumulative downtime of 4.38 hours. It helps one to know how much is the anticipated availability and associated downtime for services complying with such SLA level.
3. Azure cloud services continue to release new features. Prior to release these new services go through various stages of testing such as pre-release and Beta. Which of the following will allow all Azure customers an opportunity to test the beta and other pre-release features?
- General availability
- Public Preview (CORRECT)
- Private Preview
Correct: Currently, all customers who are entitled with the relevant Azure Active Directory license are invited to this phase to trial the new feature and test its potential, after which they provide feedback before general availability.
4. Which of the following define performance targets such as uptime?
- Usage Meters
- Service Level Agreements (CORRECT)
- Support plans
Correct: Service Level Agreements (SLAs) define the performance targets and guarantee uptime for an Azure product or service. These agreements express the service provider’s commitment to reliability and availability and inform customers regarding the expected level of service performance.
TEST PREP
1. Following your company’s migration to Azure, you have discovered that some of your development teams are creating resources for test purposes without considering the costs involved. You need to implement restrictions on the number and type of resources that they can create simultaneously.
What solution can you implement to help with this issue?
- You cannot limit resource creation.
- Create a subscription for the development team and apply spending limits to that subscription. (CORRECT)
- Assign a company budget to the development team as part of their overall annual budget.
Correct: If a subscription is exceeded, then all current active resources will be deallocated before it leads to further costs. You can choose to either raise the limit on spending or provide less provision of resources to remain under budget.
2. In your opinion is the following statement correct or incorrect?
Select Yes if you believe it to be correct and No if you believe it to be incorrect.
Incoming and outgoing network traffic to and from a VM in chargeable in Azure.
- A: Yes (CORRECT)
- No
Correct: When you provision a resource, Azure creates meters to track usage of that resource. Azure uses these meters to generate a usage record that is later used to help calculate your bill. The meters can track overall CPU time or incoming (ingress) and outgoing (egress) network traffic to the VM.
3. In your opinion is the following statement correct or incorrect?
Select Yes if you believe it to be correct and No if you believe it to be Incorrect.
Azure Reservations offer discounted prices on certain Azure services and to receive these discounts you must pay in advance.
- Yes (Correct) (CORRECT)
- No (Incorrect)
Correct: While definite services are available at Azure Reservations that provide discounts of up to 72% as compared to pay-as-you-go plans, certain amounts of cash need to be paid in advance against particular reservations. For such reservations, however, you will have to give a future use definition of services and resources usage over a required time frame.
4. Downtime refers to the time duration that the service is unavailable, how much cumulative downtime per year will an SLA percentage of 99.99 give?
- 4.38 hours
- 8.76 hours
- 3.65 days
- 52.56 minutes (CORRECT)
Correct: A 99.99% SLA percentage permits an annual cumulative downtime of about 52.56 minutes. The level of availability guarantees excellent reliability with little downtime in expectation.
5. Azure cloud services continue to release new features. Prior to release, these new services go through various stages of testing such as pre-release and Beta. Which of the following will receive support but Service Level Agreements will not apply?
- Public Preview (CORRECT)
- Private Preview
- General availability
Correct: During this period, all businesses or customers with a properly assigned Azure Active Directory (Azure AD) license will be invited to test the new capability. Microsoft Support Services will be available, but remember that the normal SLAs do not apply during evaluation. So do not assume the same level of support and uptime guarantees as for standard service.
6. Which of the following steps do you need to take to create a report with the TCO Calculator?
Check all that apply
- Subscribe to Azure
- Define your workloads (CORRECT)
- Adjust assumptions (CORRECT)
- View the report (CORRECT)
Correct: Adhere to defining your Workloads at first for the Usage of Total Cost of Ownership (TCO) Calculator. Here you define and detail regarding the present workloads, like how many servers, applications, etc., and what exact hardware and software configurations are used in your current on-premise environment. This number would become a baseline for analysis costs of running such workloads in your datacentre against Azure.
Correct: Step 2: Altering Assumptions is the second step when utilizing the Total Cost of Ownership TCO Calculator. This is the stage at which you revise and personalize the various assumptions-from energy costs to labor expenses to other factors that constitute operational costs-to make them be as representative as possible of your own environment. The aim of this step is to provide a more valid comparison of the costs induced by running workloads on Azure versus the ones of the existing on-premises infrastructure.
Correct: The process of TCO Calculator at Step 3-the reviewing of the report.
7. If your organization subscribes to Microsoft Visual Studio, which type of Azure subscription may offer credits for your Azure account and reduced rates on Azure services?
- Free trial
- Member offers (CORRECT)
- Pay-as-you-go
Correct: Your existing membership to certain Microsoft products and services might provide you with credits for your Azure account and reduced rates on Azure services. Visual Studio subscribers may be eligible for credits for your Azure account and reduced rates on Azure services.
8. Which of the factors affect cost?
Select all that apply.
- Resource usage (CORRECT)
- Azure Marketplace (CORRECT)
- Resource type (CORRECT)
- Azure subscription types (CORRECT)
- Usage meters (CORRECT)
You only pay for what you use in Azure.
The Azure marketplace lets you buy third-party solutions and services.
Many factors, including the resource type and any customization of the resource, will affect costs for Azure resources.
Some types of Azure subscriptions offer usage entitlements, which can really affect the ultimate price.
Your usage meters record your consumption, and then that is processed to a bill.
9. Which of the following statements are correct?
Select all that apply.
- Azure Reservations offers discounted prices on certain Azure services. (CORRECT)
- You can use Azure Advisor to monitor your usage. (CORRECT)
- When you use spending limits, your extra costs roll over to the following month.
Correct: Azure Reservations gives you access to discounts of up to 72% off pay-as-you-go rates. By committing future payments, you will lock in discounted prices on certain services and resources.
10. Which of the following are benefits of migrating from IaaS to PaaS?
Select all that apply.
- It can be less expensive to run. (CORRECT)
- You don’t need to worry about software updates, security patches, or optimizing physical storage for read and write operations. (CORRECT)
- You still get to manage the underlying operating system.
Correct: Moving to PaaS will certainly help save on operational costs.
Correct: Migrating to PaaS translates that you no longer have to manage software updates, security patches, or optimize physical storage for read and write operations.
11. Where can you access the SLAs for different Azure services?
Select all that apply.
- On the Service-level agreements section of the azure.Microsoft.com website (CORRECT)
- Correct: You can read the SLAs to learn about uptime guarantees and downtime credit policies on the Service-level agreements section of the azure.Microsoft.com website. Click on this link to have a look
- On the Azure Portal
- On Azure documentation (CORRECT)
Correct: The SLAs reveal uptime guarantees and the downtime credit policies in their corresponding section on the Azure website. For more details, do the needed clicking: azure.microsoft.com.
12. How much downtime do you think 99.9% and 99.99% represent approximately, in terms of hours and minutes, in a year?
- 9 hours for 99.9% and 53 min for 99.99% (CORRECT)
- 4.5 hours for 99.9% and 26 min to 99.99%
- 13.5 hours for 99.9% and 78 min for 99.99%
- 18 hours for 99.9% and 104 min for 99.99%
Correct: Uptime of 99.9% is associated with downtime durations of 9 hours. Uptime of 99.99% can be represented by 52 minutes of downtimes.
13. Which of the following do you think would happen if the Special Orders application went down?
Select all options that apply.
- Customers can’t place orders. (CORRECT)
- Staff can’t check orders status. (CORRECT)
- Tailwind Traders may lose customers. (CORRECT)
- Other operations will fail.
It would inhibit customers from being able to place orders if the Special Orders application went down.
If the Special Orders application went down, there would be no way for the employees to inquire into different orders.
Tailwind Traders stands to lose clients because of the unavailability of the Special Orders application.
14. In the scenario detailed in the table below, does the composite SLA meet the required SLA of 99.9 percent?
| Service | SLA |
|---|---|
| Azure Virtual Machines (2x) | 99.9 percent |
| Azure SQL Database | 99.9 percent |
| Azure Load Balancer | 99.9 percent |
Follow these steps to get to your answer.
1. What are the individual workloads in the Special Orders application?
2. What is the SLA for each workload?
3. Do the math?
- Yes
- No (CORRECT)
Correct: The composite SLA, as explained below, does not meet the required SLA of 99.9%.
CONCLUSION – Managing Costs & SLA Service Cycles
So this module has given a full course on the fundamentals of the various cloud pricing determinants and covers tools for estimating costs and cost management. In addition, SLAs on Microsoft Azure provide useful insight at this point as far as their relevance or contribution into the design considerations of applications is concerned. Besides, appreciably, if you understand how to access preview services, it is another asset for successfully planning and streamlining your cloud strategies.