Considerations of using cloud service

October 05, 2020

1 min read

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(True) Azure provides flexibility between capital expenditure (CapEx) and operational expenditure (OpEx)

Capital expenditures generate benefits over a long period. These expenditures are generally nonrecurring and result in the acquisition of permanent assets. Building an application could qualify as a capital expenditure. Example, Azure Reserved Instances (Azure RI) help Azure’s most active customers save on long-term VM usage reserving VMs in advance at a discounted price by committing to a one or three-year benefits.
Operating expenditures are ongoing costs of doing business. Consuming cloud services in a pay-as-you-go model could qualify as an operating expenditure. Example, you pay for a service or product as you use it i.e. pay-as-you-go pricing.

(False) Economies of scale are reserved for private clouds

The concept of economies of scale is the ability to reduce costs and gain efficiency when operating at a larger scale in comparison to operating at a smaller scale. Cloud providers such as Microsoft, Google, and Amazon are large businesses, and are able to leverage the benefits of economies of scale, and then pass those benefits on to their customers.

(True) When an Azure virtual machine is stopped, you continue to pay storage costs associated to the virtual machine

Deallocated VM

While an Azure VM is in the “Stopped (Deallocated)” state, you will not be charged for the VM compute resources. However, you will still need to pay for any OS and data storage disks attached to the VM.