The cost of living squeeze that is currently gripping parts of the world is putting pressure on household budgets. There is no shortage of commentary recently about the value of the Pound compared to the US Dollar, in fact, globally currencies are weaker against the strong US Dollar.
You can also see this squeeze on the public cloud. You may not be aware, but your cloud spend is converted from US Dollars to Sterling on a monthly basis. Microsoft set an internal rate monthly which is then used for the rest of the month to calculate your bill. The currency you are billed in is determined by the billing address on your account.
For example, at the start of October, was around £0.93 for $1 USD, last month this was £0.82, which is an increase of around 11%. So, with this, what can we do to soften the blow that comes with currency fluctuations?
Let’s discuss some of the things we normally consider when it comes to cost management and see how these tasks are affected by situations like this.
- Purchasing reserved instances
- Deploying new services or projects
- Performance-based scaling rules
Purchasing reserved instances
Normally, the advice would be to buy reservations to take advantage of lower month-to-month costs by committing to the length of time that service will be deployed. However, at the minute, I would strongly consider holding off until the situation settles down, this may only be a month or two.
Once the situation is again stable, make a call at buying your reservations at a lower cost, which will save you some money on the initial outlay of the reservation.
Deploying new services or projects
The promise of the cloud provides us with the ability to build and scale services on demand, as we see fit. But check your workloads, if they are performing well, consider tuning your scaling rules to cater for the current situation and push back any new builds which may add significant amounts of usage for a month or so.
Performance-based scaling rules
Many Azure services come with the ability to set rules based on the performance of that resource which will enable that resource to scale up and down. Scaling down when demand matches those rules is always a good idea, you can save significant amounts of money with several services when you go to minimum demand outside of core hours.
Don’t just think of scaling up, don’t forget you can scale down too.
Hopefully, the instability in currencies against the US Dollar is temporary, if the situation continues long term, then you will need to review your budgets, and even consider re-platforming to more scalable, cloud-native solutions which will help you stay under your budget.
Of course, you can track your cloud costs at a granular level using our Cloud Management Portal, as well as set flexible budgets with the ability to be notified via Teams or Slack. You can also speak to your account manager about how we can help you modernise your infrastructure to help reduce your footprint and potentially save money at the same time.