Overview

In the ever-evolving landscape of cloud computing, it is crucial to stay informed about changes that may affect your usage and business. We are writing to notify you about some important updates related to Azure Reserved Virtual Machine Instance (RI) for M-series.

What is happening?

As we continue to offer a wide selection of SKUs for M-series VMs, on December 6, we will be updating the instance size flexibility ratios for this product to optimize reservation discount within instance size flexibility groups and their respective SKUs. 

How do instance size flexibility ratios work?

When you purchase a RI, you can choose to optimize for instance size flexibility or capacity priority.  When you choose instance size flexibility, it allows the RI discount to apply to all VM sizes (SKUs) within that instance size flexibility group. The discount application varies based on the VM size selected when purchasing RIs, the sizes of VMs in use, and the ratio, which represents the relative footprint for each VM size within the instance size flexibility group. See an example of instance size flexibility group, SKUs included in that group and their ratios in the table below.

Figure 1. Example of instance size flexibility group

Why is this important?

If you have reservations for M-series VMs, optimized for instance size flexibility, you may notice changes in your reservation coverage. Although there are no price changes, your reservation utilization could change due to the changes in ratios.

Change in instance size flexibility ratios will impact the total units/VMs covered by RI, it will either increase or decrease RI coverage. Coverage for each VM SKU is measured by RI Normalization ratio, which is provided in the usage file under the additional info attribute, which can be downloaded from Cost Management (see more details on this process here).

If the RI Normalization ratio increases, the RI Coverage will decrease, resulting in overages/additional costs. If the ratio decreases, the RI will cover more VMs.

What do I need to do?

Prior to December 6, please review the list of SKUs with updated instance size flexibility ratios to understand if your VMs will be impacted. If you don’t have reservations for SKUs (VM sizes) listed in that list, these changes will not affect you.

Starting December 6, start to review your RI utilization to understand how the updated ratios may have impacted your coverage. You can find step by step guidance on how to review your utilization in the Azure Portal leveraging this MS Learn Page.

• If your reservations are underutilized, you can run more VMs of that instance, exchange unused reservations to a VM family that is not covered by an RI or you could trade-in unused reservations to an Azure savings plan for compute to increase savings. You can also find additional guidance leveraging Azure Advisor to identify additional ways to save within your environment. 
• If your reservations are 100% utilized, it is recommended to review your cost savings recommendations in Azure Advisor to identify additional ways to save within your environment such as purchasing additional RIs or savings plans. Please note that it can take up to a few days for Azure Advisor recommendations to update based on the updated ratios.

If you want to learn more about how to manage your billing account and subscriptions, please visit the Cost Management + Billing documentation.

If you are having cost management or invoice related issues because of this change, please contact support.

Additional Resources:

• Save with Azure reservations - Microsoft Cost Management | Microsoft Learn
• Prepay for Azure virtual machines to save money - Azure Virtual Machines | Microsoft Learn
• Save money with Azure Reserved Instances - Training | Microsoft Learn
• Azure Reserved Virtual Machine Instances | Microsoft Azure
• Azure Advisor – Azure Best Practices | Microsoft Azure
• Microsoft Cost Management | Microsoft Azure
• How to optimize your Azure compute spend with savings plan and reserved instances - Microsoft Community Hub