Cloud pricing comparison: AWS vs. Microsoft Azure vs. Google Cloud vs. IBM Cloud

Microsoft Azure generally has the lowest on-demand and discounted instance pricing, while AWS runs in the middle of the pack

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The impact of regions on cloud pricing

Different cloud regions have different pricing for each cloud provider. The most expensive regions in Asia Pacific can be 50 percent more than the lowest price regions in the U.S. For example, on an hourly basis, the relative prices between cloud providers may change. In Asia, the price differences are especially pronounced. On an annual on-demand basis, when a local disk is not required, the built-in SUD makes Google the lowest priced option. When a local disk is required, Google is till lowest price, except in Europe where Azure wins.

annual on demand cloud cost comparison no disk RightScale


annual on demand cloud cost comparison local ssd RightScale

Cloud pricing for Linux vs. Windows

Each cloud provider charges a premium for instances running Windows in order to cover the licensing costs for Windows. The options below are all in the U.S. with no local disk. Google is still the lowest priced in the on-demand comparison due to the SUD. IBM is the lowest priced in the discounted comparison because it has a significantly lower premium for Windows than the other three providers.

Keep in mind that the Azure Hybrid Use Discount, which allows you to apply existing Windows licenses from on-prem to Azure, could bring that Azure price for Windows down. However, you will be forgoing the use of that license on-prem unless you have Datacenter Editions.

In looking at the premium paid for Windows, you can see that

  • AWS and Azure have the same Windows premium of $806 annually.
  • Google has a lower premium for Windows of $700 annually.
  • Interestingly, IBM has a far lower premium for Windows of only $303 for on-demand.
  • The premium for Windows on Azure could be reduced by using the Hybrid Use Discount.
annual on demand cloud cost comparison linux windows RightScale

The bottom line on cloud pricing: AWS vs. Azure vs. Google vs. IBM

RightScale research has found that companies waste on average 35 percent of cloud spend, so focusing on optimizing your use of cloud can result in significant savings.

Your costs on cloud instances are going to depend on your particular use case: the instance types you choose, the regions you run in, whether you need local disk for your instances, and your use of discounts.

Developing a multi-cloud strategy is a critical component of cloud cost management efforts. The ability to use more than one public cloud provider not only gives you negotiating leverage, but also allows you to include cost as one of the factors to consider when deploying to the public cloud.

Kim Weins is vice president of cloud cost strategy at RightScale. She has held executive marketing positions at a variety of enterprise software startups and public software companies. She received a B.S. in engineering from Duke University.

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