Microsoft Azure Goes for the Gold

The first ones are free. After that you have to pay.

That’s the message Microsoft (NASDAQ: MSFT) has been putting out for months regarding its Windows Azure cloud-computing platform. Now, the second part kicks in.

Microsoft began charging customers for use of its Azure platform Monday, Feb. 1, after making the service free to vendors who want to develop and sell services hosted in the software giant’s cloud.

Now, the question is will customers decide to pay for the services and remain loyal to the software giant’s play in the cloud-computing space? Or will they stiff Microsoft and move on?

“We are announcing the general availability of Windows Azure and SQL Azure in 21 countries,” Doug Hauger, general manager of Windows Azure business and marketing, said in a blog post on The Microsoft Blogon Monday. “Starting today customers and partners across the globe will be able to launch their Windows Azure and SQL Azure production applications and services with the support of the full service level agreements (SLAs).”

In other words, vendors can now start charging their customers for services provided via the Azure cloud as Microsoft, in turn, starts billing the vendors.

In January, Microsoft transitioned the Azure platform, which had been in a community technology preview (CTP) mode for months, to a production system, although it didn’t charge for Azure’s use last month.

Microsoft gave an example of early Azure usage in the blog post, citing a forecasting firm named Lokad. In the example, Hauger said, a large European e-commerce company that is one of Lokad’s customers, “already has more than 300,000 product references in store, with plans to upgrade to 1 million product references during 2010.”

According to Hauger’s post, Lokad’s initial success is based on Azure’s ability to transparently scale to the kinds of levels customers need at an attractive price, regardless of whether the demand for the service is rising or falling.

Microsoft announced pricing for Azurecustomers during the company’s Worldwide Partner Conference 2009 in New Orleans in July.

Basic Azure services cost $0.12 per hour, $0.15 per gigabyte of storage, and $0.10 per 10,000 storage transactions. Beyond that, there is a bandwidth charge of $0.10 per gigabyte in and $0.15 per gigabyte out.

Microsoft also offers services C la carte. Using SQL Azure database services, a database of up to a 1 GB costs $9.99, while up to 10 GBs costs $99.99.

Additionally, use of Microsoft’s .NET Services will cost $0.15 per 100,000 message operations.

Microsoft also promises compute connectivity SLAs at 99.95 percent, and a 99.9 percent guarantee for storage, the company said in July.

Based on feedback from the CTP, Microsoft added additional pricing options, according to a post on the Windows Azure Team Blogin early January.

“We are also introducing updated pricing for the Windows Azure platform AppFabric, which helps developers connect cloud and on-premises applications,” the company said. “Service Bus will now be priced at $3.99 per connection-month, and Access Control will be $1.99 per 100,000 transactions.”

Microsoft is not alone when it comes to cloud-computing offerings, of course.

Amazon (NASDAQ: AMZN), Google (NASDAQ: GOOG) and (NYSE: CRM), among others, are all competing with Microsoft in creating cloud platformsand applications.

A company spokesperson declined to comment beyond the blog posts on the move to begin charging customers for the cloud services.

Stuart J. Johnston is a contributing writer at, the network for technology professionals.

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