Cloud FinOps using Archera for Microsoft Azure: Effective Cloud Costs Management in the Age of Rapid AI Adoption
Cloud computing and AI tools like ChatGPTs, chatbots, AI agents, and Copilots are rapidly evolving.
As designers, builders, problem-solvers, and creators of technology, we must develop innovative applications that uphold privacy, security, and credibility. Navigating the rapid advancements in Edge, Cloud, Artificial Intelligence (AI), and Machine Learning (ML) technologies presents a significant challenge.
One of the questions I have in my mind when I think about these evolving new technologies is how can we keep pace with these evolving technologies while maintaining our ethical standards and trustworthiness?
I could not make it to the Microsoft Build 2025 developer conference event in-person this week, this year, but checking out some sessions virtually. The event is still ongoing this week and I still have a lot to catch up and learn at #MSBuild 2025 sessions. However, I cannot help but noticed that most of the technical presented and updates so far at this conference has a lot of focused on new trends and upcoming technologies related to AI, especially developing AI agents and a lot more.
See? As a technologist working with tech and sharing knowledge about tech, I need to cope up with what is new and trending in tech. As we all probably guilty of or “not there” yet phase.
If you missed the Day 1 of Microsoft Build, 2025 happening this week, there is a blog update you can read about what is new especially in terms of building with Azure AI Foundry Agent Service that enables us, developers to build generative AI for our apps, multi AI Agents orchestration, and a lot more!
(Did you know that AI agents can talk to each other is possible? Which I first learned about after recently attending and speaking at Global Azure Portugal 2025 – another blog post I plan to share about one of these days)
In this Microsoft Build news blog, it was boldly highlighted, “Empower every developer to shape the future with AI”.
Although I hold a job title of “Senior Azure Consultant“, I toggle between different roles and hats depending on what I do for the past decade. As a developer building with cloud technologies within Microsoft tech stack, I am still learning AI with Azure to cope up with the tech trends, AI evolution, and tech upskilling, how can we really empower developers or each other with all these things that are new?
How can we really build solutions that are smart by synergizing and integrating our technical and problem-solving skills along with the impressive capabilities of AI?
I can share my different and personal perspective on this question in various of ways – of course depending on the hat I will be wearing, but on this article blog, I will be focusing on cloud computing costs, its challenges and its impact – based on my perspective and my own experience in different cloud projects – as a developer, as cloud engineer, as an architect, an Azure advisor, and someone who work with these tech and people building it with me every day.
Coping Up with Evolving Technologies in Different Aspects
As leaders making essential decisions for IT projects, how can we create and develop solutions for ideas and use cases without spending too much money and making mistakes we regret later, or do we need to pay extra money?
Cloud Computing and AI Foundations Are Essential So Is Saving Money From Cloud Costs
If we were to zoom in and focus on adapting cloud computing and AI technologies alone, we would still be a work in progress. As we build, we are still working towards continuous improvement in any IT solution. Technologies and AI tools for the cloud platforms give a lot of opportunities for IT organizations to improve their cloud management and IT operations by utilizing the cloud platforms’ features and tools to strengthen scalability, flexibility, and availability to support all their users globally, especially in this remote and hybrid working generation today.
Microsoft Azure has been part of my career journey as someone who works with cloud management and application development. I work on it and solve problems with it every day—I even wrote a book about this cloud platform because of the challenges many face when building and working on solutions for the cloud.
My book, Learning Microsoft Azure: Cloud Computing and Development Fundamentals (O’Reilly), results from the cloud migration gap and the challenges I have experienced and observed. One of the things I learned from such a cloud migration from on-premises to the cloud was the lack of foundational knowledge of the cloud. The lack of foundational knowledge on building solutions for the cloud, including AI technologies, often leads to wrong choices in implementing cloud services for specific problems and use cases.
In my book which is translated in several languages, I mentioned in one of the chapters about cloud management and DevOps that knowing cost management tools within the platform is essential. Cloud is meant to remove the high costs of capital expenditures (CapEx) from the traditional IT infrastructure and should be more efficient; however, many organizations who aim to modernize and build for cloud, or even hybrid cloud yet still have the challenge and the gap on truly understanding on how pricing models on cloud platform works. When they are already on the cloud, they do not know how to properly manage and flexibly navigate the changes as infrastructure and business use cases evolve and continue to change over time.
Common Challenges in Cloud Cost Management and Cost Optimization on Microsoft Azure
As a cloud platform, Microsoft Azure provides numerous benefits to businesses. However, with these advantages come challenges, particularly in cost optimization.
Many face a known challenge regarding cloud cost optimization and computing expenses: the lack of adequate visibility and control over cloud resource expenditures.
Many cloud users still struggle to track and manage their spending effectively. These challenges lead to unexpected costs and budget overruns. It is understandable that analysis, truly understanding usage patterns, and identifying cost drivers can be complex, making it challenging to implement cost-saving measures. Several cloud cost management tools within Azure can help management.
The Truth: Not All of Us Truly Understand How Cloud Works and How Much it Costs
Cloud is powerful, but it is not cheap. The Pay-As-You-Go pricing models that most major public cloud provider providers allows its users and consumers to only pay for whatever consumed on a cloud resource or service; however, it can either both expensive and cheap depending on the wise decisions made on planning the cloud solution architecture, how the applications built and set-up on Azure, and how quick are the teams on these IT projects are adopting to the evolving changes – not just with the evolving technologies but also the changes required for cloud-hosted applications as the demand by users or business change.
Like any other pricing model for IT products and services, the pricing models for cloud services on Microsoft Azure can be complex. These models may add another layer of complexity and decision-making tasks for the people and teams involved.
The structure of Azure’s pricing looks easy when you have different tiers to choose from based on categories. Still, too many options and other variations of services in diverse use cases can make it more challenging for people working with them to predict costs accurately and budget accordingly. Microsoft Azure is a central cloud platform today with many available services and a massive list of cloud services.
Cloud is powerful, but it is not cheap.
Most Azure services can be used with pricing models, including compute hours, storage capacity, data transfer, and other flexible features. The variety of services available and their various categories of pricing tiers create complexity, making it difficult for organizations to understand the cost of cloud usage and have a good overview of assessing and identifying the cloud cost optimization opportunities that enable them to save money from their monthly Azure subscription costs.
Moreover, Azure’s pricing can be unpredictable due to variable usage patterns, changes in service configurations, and fluctuations in demand. Organizations may find it challenging to forecast their cloud expenses and to plan their budgets effectively. This unpredictability can lead to unexpected costs and make it difficult to achieve cost savings.
One known concern and challenge is the lack of knowledge, background, and expertise about cloud services on a cloud platform such as Microsoft Azure. Many IT organizations are clueless about the cost-saving possibilities that are obtainable. These include Azure Hybrid Benefits, Azure Reservations, the different Pricing Models, and the Pay-per-Use Consumption tiers.
Consumption Pricing Models - Are they Really Cheap and Worth it?
One example of Azure services commonly used in Consumption tiers is Serverless technologies on Azure, such as Azure Functions. These technologies can be very expensive or cheap, depending on how they were built and configured, and the type of service or pricing tiers used on this consumption model. Therefore, educating IT teams on these cloud services can help them make wise decisions on cloud development, choose the exemplary Azure service for a use case, and guide them in effective cloud cost planning and management. Of course, these things are possible by selecting and using the right tool for cloud cost management, where transparency and visibility are standard and default.
Application and Business Requirements Evolves and Changes Over Time
Another common challenge is making decisions and updating the type of cloud services and tiers on Microsoft Azure as the application’s architecture and demands change over time.
Business user requirements change as applications evolve, demanding timely changes—such as upgrades or downgrades to cloud services. When this happens, teams often have to start considering scaling existing cloud resources, transitioning to different service types, or modifying configurations to align with current business requirements or user needs.
Teams must actively monitor performance and costs and review cloud architecture. Data-driven decisions are essential for optimizing cloud costs and performance based on the production environment’s demands. This is when effective collaboration among development, operations, and finance teams is crucial for implementing these changes efficiently.
Organizations can implement various cloud cost optimization strategies to address these challenges. Utilizing cost management tools like Azure Cost Management + Billing provides a unified view of cloud spending and identifies optimization opportunities within the native Azure environment. These tools enable organizations to track expenses, set budgets, and monitor spending proactively.
Microsoft Azure Consumption Commitment (MACC) and Azure Reservations
IT organizations using Microsoft Azure as a cloud platform benefit from some of its features. These benefits can vary depending on whether you are a Microsoft Partner. The ability to commit to options such as Azure Reservations and commitments is another powerful strategy for cost optimization.
For example, organizations can reserve their cloud resources at a discounted rate by utilizing Azure Reservations, while Consumption Commitments provide cost savings for committed usage. There are external Cloud FinOps tools today that allow you to gain more visibility on these commitments with Microsoft Azure while getting paid for underutilized services within the pledges.
Archera's Platform – A FinOps Tool for Better Cloud Cost Visibility and Cloud Cost Management
Archera, a cloud cost management tool, offers cloud commitment insurance, which covers the difference if an organization underutilizes its Microsoft Azure Consumption Commitment (MACC). This feature allows organizations to achieve cost savings with native plans with a commitment of as few as 30 days instead of the typical 1 to 3 years.
Archera integrates seamlessly with Azure Cost Management + Billing, providing a unified view of the money you pay for cloud resources. The tool can also help customers with reservations on any Azure service that allows reservations. The commitments you can purchase with the Archera tool cover services like Azure Functions, Azure Databricks, Microsoft Fabric, and OpenAI, which many companies may not know they can reserve. Organizations can achieve significant cost savings by utilizing reservations and optimizing resource usage.
Additionally, Archera provides awareness and help on visibility of core cloud resources being utilized and underutilized on Microsoft Azure, especially those under customer agreements with Microsoft, such as Azure Reservations.
Many organizations that use Azure are unaware that they can reserve some of their services on Azure. It is hard to see this without a tool showing you the necessary information. Therefore, Archera helps bridge this knowledge gap. Organizations that gain visibility into their Azure reservations can make more informed decisions and optimize their cloud costs effectively.
Archera’s Insured Azure Commitments
Archera’s cost management forecasting platform and spending insurance commitment reminders are good external tools for managing cloud expenses. The platform helps Azure customers become more comfortable with reserving services they wouldn’t have considered. Archera’s 30-day commitments are its most used product, allowing customers to scale up for deployments or other heavy usage periods with protection on the spend. This helps customers become more comfortable with insuring commitments at a low risk.
This FinOps tool for the cloud supports the lifecycle of a MACC. It assists with planning for a MACC, utilizing it in the middle, ramping up as needed, and meeting usage and spending goals. Clients can also use their insured Azure commitment to spend toward Archera’s premiums. As per information gathered, Archera claims they can save clients 15% or more on their MACC agreements by helping them efficiently forecast, plan, utilize, and ensure their cloud service spending.
Archera’s FinOps and cost management platform helps manage Azure rates and discounts. It provides access to Insured Commitments, flexible-term Azure savings plans, and reserved instances that enable users to capture discounts on Azure services without committing to a one—or three-year term. Thousands of customers use Archera to analyse their cloud costs and usage, deliver FinOps insights and reporting, and create usage forecasts integrating historical data and future inputs like increased usage, migrations, and infrastructure transformations.
Archera’s recommended commitment policies consider various combinations of available contracts (including Archera’s Insured Commitments) to find the optimal blend for maximizing savings, flexibility, or a balance. Customers can compare the cost impact of different commitment strategies and discount/credit programs (such as the Microsoft Azure Consumption Commitment) across forecasted scenarios.
The insured cost savings plans and reservations on Archera allow users to obtain discounts on commonly used services on Microsoft Azure, such as Azure VMs, App Services, Azure SQL, SQL MI, and other Azure services offering commitments. Users can receive up to three years of coverage with the flexibility to cancel after 30 days. This option helps mitigate risks and covers use cases unsuitable for one- and three-year commitments, such as migrations, infrastructure changes, and inconsistent or seasonal usage patterns.
If you are curious about Archera and want to begin saving costs from the Azure subscriptions your organization is already paying, feel free to check out this guide on integrating Archera for cost savings on Microsoft Azure.
Conclusion: Utilize the Power of Cloud but Don't Overspend
In conclusion, effective cloud cost management becomes vital as cloud computing and AI evolve. It is not just about learning and coping with cloud and AI technologies; we also need to consider practical factors such as costs—how much will all these powerful technologies cost us?
From my own perspective and as someone working with Azure for many years and teaching cloud engineering to others, carefully choosing and utilizing cloud cost optimization tools built into the Azure platform and external cost optimization tools like Archera for your Azure reservations and commitments can give you an overview, cost management control, and cost savings that you can spend on other cloud resources you need.
Remember, by prioritizing and rethinking your cost optimization plan and strategies, you can maximize the benefits of cloud technologies while minimizing expenses. Cloud costs are an essential factor to consider, especially when you are building with AI on the cloud these days.
Utilize the power of Cloud but Don't Overspend
A Big Question:
What challenges have you faced in managing cloud costs?
Archera is a platform that seems interesting and valuable. It took my curiousity and I am curious to learn more about this cloud cost optimization service for Azure. Have you used Archera’s cost optimization tool before?
In the comments below this article, please feel free to share your challenges, real-life experiences on challenges with your cloud spending on Microsoft Azure. If you have any tips and tools related to cost cloud management.
NOTE:
NOTE: This article is also published on my blog and I wrote this article from my own perspective on cloud cost optimization and is a sponsored content by Archera.
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