Azure Savings Plan
An Azure savings plan, or savings plan for compute, is a commitment to a fixed hourly spend on eligible Azure compute services across regions, for a one or three year term, in exchange for a lower rate than pay-as-you-go. It is more flexible than a reservation because the discount applies to any eligible usage up to the committed hourly amount.
Key Takeaways
- A commitment to a set hourly spend on eligible compute.
- Applies across regions and eligible compute services.
- More flexible than a reserved instance, which is tied to a specific instance and region.
- Available in one or three year terms.
How an Azure savings plan works
The customer commits to spend a fixed amount per hour on eligible compute for one or three years. Usage up to that hourly commitment is charged at the lower savings-plan rate, and usage above it is charged at pay-as-you-go. Because the benefit applies to any eligible compute across regions, it suits workloads that shift or scale.
Why it matters for Microsoft CSPs
Partners help customers optimize Azure cost, and savings plans are a key lever. Partners also have to bill and reconcile the committed spend accurately, so it appears correctly on customer invoices alongside variable usage.
Azure savings plan vs reserved instance
A reserved instance commits to a specific instance type in a specific region and gives the deepest savings on stable workloads. A savings plan commits to an hourly spend across regions and services, which is more flexible for dynamic workloads.
How Work 365 supports this
Work 365 bills and reconciles Azure, including committed spend, against contracts for accurate customer invoices. See Azure Billing.
Related terms: Azure Reserved Instance, Azure Billing, Azure CSP Billing, Azure Plan.
Related Work 365 Resources
- Blog: Optimize Azure Billing and Cost Management
- Blog: How to Bill Azure Reserved Instances Without Revenue Leakage
- Blog: Managing Azure Growth and Billing with Work 365
- Product: Azure Billing
FAQ
How long is an Azure savings plan?
One or three years.
How is a savings plan different from a reserved instance?
A savings plan commits to hourly spend across regions and services; a reservation commits to a specific instance and region.
