Application Gateway Optimize the cost of your Application Gateways.

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Azure Application Gateways are one of several types of scalable and secure network services that Azure offers. Typically, you choose an application gateway when you need advanced traffic management and web application firewall capabilities for your web applications.

An Azure Application Gateway provides a dedicated instance of a web traffic load balancer with Layer 7 routing, SSL termination, and web application firewall functionality. This allows you to manage and optimize the traffic to your web applications, ensuring they are secure, fast, and reliable. However, you still need to maintain the application gateway by performing tasks such as configuring rules, updating SSL certificates, and monitoring the gateway’s performance.

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Optimize Application Gateway usage

Identify Idle Application Gateway instances.This query will get the Application Gateways that have empty backend pools.

resources
| where type =~ 'Microsoft.Network/applicationGateways' and resourceGroup in ({ResourceGroup})
| extend backendPoolsCount = array_length(properties.backendAddressPools),SKUName= tostring(properties.sku.name), SKUTier= tostring(properties.sku.tier),SKUCapacity=properties.sku.capacity,backendPools=properties.backendAddressPools
| project id, name, SKUName, SKUTier, SKUCapacity
| join (
    resources
    | where type =~ 'Microsoft.Network/applicationGateways' and resourceGroup in ({ResourceGroup})
    | mvexpand backendPools = properties.backendAddressPools
    | extend backendIPCount = array_length(backendPools.properties.backendIPConfigurations)
    | extend backendAddressesCount = array_length(backendPools.properties.backendAddresses)
    | extend backendPoolName  = backendPools.properties.backendAddressPools.name
    | summarize backendIPCount = sum(backendIPCount) ,backendAddressesCount=sum(backendAddressesCount) by id
) on id
| project-away id1
| where  (backendIPCount == 0 or isempty(backendIPCount)) and (backendAddressesCount==0 or isempty(backendAddressesCount))
| order by id asc

Data ingestion

  • VM states: As VM instances transition through different states (running, stopped, deallocated), they may incur different billing rates. Ensure efficient VM management to minimize unnecessary costs during idle periods.

Storage:

  • Disk size: Storage costs are determined by the size of disks attached to VMs, measured in gigabytes (GB). Larger disk sizes contribute to higher storage costs.

  • Transactions: Transaction-based costs apply to storage and are influenced by the number of transactions per hour. Refer to the storage billing documentation for detailed information on transaction costs.

Virtual network and bandwidth:

  • Virtual network data transfer: Costs are associated with the amount of data transferred across virtual networks, measured in gigabytes (GB). Be mindful of data transfer volumes to optimize costs.

  • Bandwidth: Similar to virtual network data transfer, bandwidth costs are based on the amount of data transferred. Efficient network management helps control bandwidth-related expenses.

Associated services:

  • Azure Monitor: Costs for Azure Monitor are based on the volume of data ingested. Monitor and optimize the data ingested to manage associated expenses effectively.

  • Azure Bastion: Billing for Azure Bastion is determined by the volume of data transferred. Monitor and control data transfer to regulate costs.

  • Azure DNS: Charges for Azure DNS depend on the number of DNS zones hosted and the quantity of DNS queries received. Manage DNS resources efficiently to control costs.

  • Load balancer: If load balancers are utilized, costs are determined by the number of rulesets, hours used, and the amount of data processed. Optimize load balancer configurations for cost-effectiveness.

  • Backup: Backup costs are associated with the chosen backup replication policy and frequency. Regularly assess and adjust backup strategies to align with cost-effectiveness and data recovery needs.

Allocation

A highly effective method for grouping and allocating costs is through the tag inheritance feature in Cost Management. Enabled tag inheritance applies billing, resource group, and subscription tags to child resource usage records.

Once tag inheritance is enabled, tags from billing profiles, invoice sections, subscriptions, and resource groups are automatically applied to child resource usage records for the current month within 24 hours. For detailed instructions, refer to the Cost allocation guidance.

Tagging best practices:

Implementing tag inheritance and following these tagging best practices enhances your ability to efficiently allocate and manage VM costs.

Reporting + analytics

To report on VM costs comprehensively, consider all the services mentioned in the Data Ingestion capability, including but not limited to:

  • Virtual machines: Understand the hourly billing, VM size, regional pricing, and states (running, stopped, deallocated).
  • Storage: Factor in storage costs based on disk size and transactions per hour.
  • Virtual network and bandwidth: Include costs related to data transfer and bandwidth usage.
  • Associated services: Consider costs associated with Azure Monitor, Azure Bastion, Azure DNS, and Load Balancer if used.

Validating VM usage:

Once you’ve identified all the costs associated with a VM, the next crucial step is to validate the VM usage to ensure it is properly sized. This involves:

  • Right-sizing VMs: Review the VM size to ensure it aligns with the actual workload requirements. Consider scaling up or down based on usage patterns.
  • Efficient resource management: Leverage Azure services such as Cost Management and Azure Monitor to gain insights into VM performance metrics, allowing you to identify areas for optimization.

Anomalies

Anomaly detection helps pinpoint unexpected spikes or irregularities in VM spending, enabling timely intervention to optimize costs. Identifying irregularities helps in optimizing resource allocation, ensuring resources are used efficiently.

  1. Utilize Azure Monitor:
    • Leverage Azure Monitor to access detailed insights into VM performance metrics. Set up alerts for key metrics such as CPU usage, memory utilization, and disk activity.
  2. Cost management tools:
    • Leverage the cost management tools, such as Azure Cost Management and Power BI, to analyze spending patterns and detect unusual spikes in VM costs.
  3. Performance metrics:
    • Correlate cost anomalies with performance metrics. Anomalies in resource utilization may directly impact costs.
  4. Resource configuration:
    • Evaluate the configuration of VM resources. Anomalies could be linked to improper resource allocation or sudden changes in demand.


Quantify business value

Unit economics

Estimation + forecasting

Before creating a VM, leverage the Azure Pricing Calculator to simulate costs. This tool allows you to estimate expenses based on your selected VM configurations, helping you make informed decisions and plan budgets effectively.

Understanding and proactively managing the costs associated with VMs and related services are key components of a successful cloud financial management strategy. Regularly review and optimize your resource usage to ensure cost-effectiveness and alignment with your business goals.

Budgeting

Effectively budgeting for VMs in Azure involves considersing different factors, including VM sizes, usage patterns, and potential discounts.

Benchmarking


Quantify business value

Architecting for cloud

Understanding VM sizes (SKUs):

  • Evaluate performance needs: Choose VM sizes based on the specific performance requirements of your workloads. Consider factors such as CPU, memory, and storage capabilities.

Usage patterns:

  • Continuous vs. scheduled usage:
    • Determine if VMs need to run continuously or if there are periods when they can be powered off. Schedule VMs to align with actual workload demands, optimizing costs during idle periods.

Existing commitment discounts:

  • Reserved instances (RIs):
    • Leverage reservations for VMs that have consistent usage patterns to benefit from significant cost savings. Commit to a one-, three-, or five-year term for VMs with ongoing, predictable usage.
  • Azure Hybrid Benefit (AHB):
    • If you have on-premises Windows Server licenses with Software Assurance, consider utilizing Azure Hybrid Benefit for additional cost savings on VMs.

Underlying services:

  • Networking costs:
    • Factor in networking costs associated with data transfer and bandwidth. Optimize network configurations to minimize unnecessary expenses.
  • Backup services:
    • Assess backup requirements for VMs. Utilize Azure Backup to efficiently manage and optimize backup costs based on retention policies and storage needs.
  • Monitoring and alerts:
    • Leverage Azure Monitor for VMs to gain insights into performance metrics and set up alerts. Proactively monitor VMs to identify potential issues and optimize resource usage.

Utilization efficiency

Optimizing the utilization efficiency of VMs in Azure is essential for achieving cost savings and maximizing resource efficiency.

  1. Regular right-sizing reviews:
    • Conduct regular reviews of VM sizes based on performance assessments and Azure Advisor recommendations. Right-size VMs to align with actual usage patterns.
  1. Scheduled shutdowns:
    • Identify and schedule automated VM shutdowns during idle periods. Implement Azure Automation runbooks for efficient management of startup and shutdown routines.
  2. Continuous monitoring and alerts:
    • Implement continuous monitoring using Azure Monitor and set up
  3. Automated tagging with Azure policy:
    • Simplify and standardize tagging by utilizing Azure Policy to automatically apply tags to VMs. This streamlines the allocation process, ensuring adherence to tagging standards.

Workload management

  1. Regular performance reviews:
    • Conduct regular reviews of VM performance metrics. Adjust VM SKU based on changing workload patterns.

  2. Automation implementation:

    • Implement automation for routine workload management tasks. This includes auto stop and start VMs based on schedule.
  3. Continuous monitoring:
    • Establish a continuous monitoring process using Azure Monitor and Log Analytics. Proactively address performance issues to maintain optimal workload management.

Licensing + SaaS

Commitment discounts

Commitment discounts, such as reservations and savings plans, offer significant cost savings for organizations utilizing VMs in Azure.

  1. Evaluate workload stability:
    • Assess VM workloads to understand stability and usage patterns. Stable workloads with predictable usage are prime candidates for Reserved Instances.
  2. Long-term commitments:
    • If your organization can commit to long-term usage, consider Reserved Instances. Evaluate the one or three-year commitment options based on budgetary considerations.
  3. Flexibility and usage variation:
    • For workloads with varying usage or the need for flexibility, explore Azure Savings Plans. Savings Plans provide discounts while accommodating changes in VM size, family, or region.
  4. Cost analysis:
    • Utilize tools like Azure Pricing Calculator and Microsoft Cost Management to perform cost analysis. Compare the potential savings of commitment discounts against on-demand pricing.
  5. Regular review:
    • Periodically review VM workloads and commitments. Adjust commitment discounts as needed to align with evolving usage patterns.

Cloud sustainability


Manage the FinOps practice

FinOps practice operations

FinOps education + enablement

FinOps assessment

Cloud policy + governance

FinOps tools + services

Chargeback + invoicing

Intersecting disciplines


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