Microsoft slashes Azure prices in UK

Vendor reduces prices for a range of VMs and storage options

Microsoft has cut prices for a range of its UK Azure products after its cloud prices rose 22 per cent at the start of this year.

Microsoft hiked its UK cloud enterprise price on 1 January, but has quickly followed this up by reducing the price of several Azure virtual machine (VM) families and storage types.

Prices for the F1 to F16 virtual machines have been cut by 23 per cent on Linux VM and 18 per cent on Windows VM, while A1 Basic has been reduced by 42 per cent on Linux and 51 per cent on Windows.

There have also been reductions in storage, with Hot Block Blob storage prices dropping 26 per cent and Cool Block Blob storage down 38 per cent.

All of the new prices are effective immediately, with the reductions differing across different regions.

"We strive hard at Azure to offer you the best value in one of the most cost effective ways in the public cloud," said Venkat Gattamneni, director of product marketing for Microsoft Azure.

"We believe in providing a comprehensive cloud platform that not only enables customers to innovate rapidly, but to also do so at the best possible prices.

"To that end, today we are happy to announce significant price reductions on several Azure virtual machine families and storage types. We hope this will further lower the barrier to entry for our customers and accelerate cloud transformation."

Kelvin Kirby, CEO of Microsoft partner Technology Associates, said the reductions will go some way to offsetting the price increases from last month.

"A lot of customers have been hit by the 22 per cent increase on Office 365 and other licences and so actually this counteracts I think some of that pricing, particularly as we're seeing more and more customers moving into Azure," he said.

"For partners the pricing cut is good news because it will help provide some leverage to, as it were, lever some partners off the fence, so I think that is definitely going to be a good thing, but as long as you can lock that pricing for three years - that's going to be the key. How long is that pricing going to remain intact?

"I think we should expect pricing to continue going downwards for cloud-based storage in the next couple of years.

Despite the reductions coming soon after the 22 per cent rises, Kirby doesn't think the move was Microsoft's response to criticism, but is in line with cloud pricing in general.

"I don't think it's that," he said. "I think Azure pricing has been dropping anyway over the last 18 months - we've seen a few drops actually over time - so I think this is Microsoft responding to economies of scale in their datacentres and being able to offer better prices on storage.

"As Microsoft evolves its technology platform for managing Azure it becomes more efficient, more productive and what we're seeing now is translating that into delivery to customers in terms of lower prices."

The price cuts come after data from Synergy Research suggested that Microsoft ate into AWS' lead in the public cloud market in Q4.