Note
Access to this page requires authorization. You can try signing in or changing directories.
Access to this page requires authorization. You can try changing directories.
When designing your architecture, balance connectivity requirements with financial constraints while maintaining secure, performant network infrastructure. For an overview of Virtual Network capabilities, see What is Azure Virtual Network?. Key considerations include:
- Do your allocated budgets enable you to meet connectivity and performance goals?
- What's the spending pattern for network services across your workloads?
- How can you maximize network investment through better resource selection and utilization?
A cost-optimized Virtual Network strategy isn't always the lowest cost option. Balance performance and connectivity requirements with financial efficiency. Tactical cost-cutting can create performance bottlenecks or security gaps. To achieve long-term efficiency and financial responsibility, create a strategy with risk-based prioritization, continuous monitoring, and repeatable processes.
Start with the recommended approaches and justify the benefits for your connectivity requirements. After you set your strategy, use these principles through regular assessment and optimization cycles. For comprehensive guidance on cost management, see Microsoft Cost Management documentation and the Azure pricing calculator.
Understanding Virtual Network billing components
Azure Virtual Network costs include several components that directly affect your monthly expenses:
| Cost Component | Description | Billing Model |
|---|---|---|
| Virtual Network | Base virtual network infrastructure | Free (up to 1,000 VNets per subscription) |
| VNet Peering (Same Region) | Data transfer between peered VNets in same region | Priced per GB (inbound and outbound) |
| Global VNet Peering | Data transfer between peered VNets in different regions | Zone-based pricing (per GB) |
| Accelerated Connections | Enhanced connection performance for network-intensive workloads | Hourly rate per network interface (NIC) (varies by SKU) |
| Virtual Network TAP | Traffic mirroring for monitoring | Priced per network interface (NIC) per hour |
| VPN Gateway | Hybrid connectivity to on-premises | Hourly compute + data transfer |
| NAT Gateway | Outbound internet connectivity | Hourly + data processing charges |
| IP Addresses | Public IP addresses | Hourly charges per IP |
Understanding these billing components helps you make informed decisions about network architecture and traffic routing patterns.
Develop network planning discipline
Cost optimization for Virtual Network requires understanding your connectivity patterns and aligning infrastructure investments with business priorities. Set up clear governance and accountability for network decisions. For more on governance frameworks, see Azure governance documentation.
| Recommendation | Benefit |
|---|---|
| Develop a comprehensive network inventory that catalogs all virtual networks, peering connections, gateways, and their business criticality levels. | A complete inventory enables data-driven decisions about network topology and helps prevent both over-provisioning expensive connections and creating inefficient traffic patterns. Prioritize network investments based on actual workload communication needs. |
| Establish clear accountability for network architecture decisions with defined roles for networking, operations, and finance teams. | Clear accountability ensures network decisions consider both performance requirements and budget constraints. Collaborative decision making prevents siloed choices that might create unnecessary costs or performance issues. |
| Create realistic budgets that account for both immediate connectivity needs and planned growth in workloads and data transfer volumes. | Proper budgeting enables predictable network costs and prevents reactive decisions when workloads scale. Plan for network expansion as your Azure footprint grows. |
| Implement network planning best practices that define connectivity patterns and standardized policies for different workload types. | Structured network planning provides consistent approaches to evaluate connectivity needs while ensuring efficient traffic flows. This helps identify optimal peering strategies and prevent over-complicated network topologies. |
Choose the right connectivity model
Azure Virtual Network offers different connectivity patterns with unique cost structures and performance characteristics. Choose the model that aligns with your workload distribution and communication requirements. For details on Virtual Network capabilities, see Virtual Network concepts and best practices.
| Recommendation | Benefit |
|---|---|
| Use hub-and-spoke topology with centralized shared services in hub virtual network and workload-specific spoke VNets connected via peering. | Hub-and-spoke reduces complexity and centralizes common services like firewalls, VPN gateways, and monitoring. You pay peering costs only between hubs and spokes, avoiding mesh peering charges. This topology scales efficiently as you add new workloads. To implement hub-and-spoke, see Hub-spoke network topology in Azure. |
| Implement regional VNet peering instead of global peering when workloads can be colocated in the same Azure region. | Regional peering costs less than global peering. You reduce latency while minimizing data transfer expenses. Design workload placement to maximize same-region communication when performance requirements permit. |
| Use Azure Private Link for connecting to Azure PaaS services instead of routing traffic through public endpoints. | Private Link eliminates virtual network peering charges for PaaS access and improves security. You pay Private Link endpoint charges but avoid unnecessary peering costs and data transfer over public networks. This approach optimizes both cost and security. For more information, see What is Azure Private Link?. |
| Implement subnet peering when only specific subnets need connectivity between virtual networks. | Subnet peering reduces costs by limiting peering scope to necessary subnets rather than entire virtual network address spaces. You pay for data transfer only on required communication paths. This granular approach prevents paying for unused peering capacity. To configure subnet peering, see How to configure subnet peering. |
Design for network efficiency
Optimize your network architecture to minimize unnecessary data transfer and peering connections while maintaining required connectivity and performance. Your architectural decisions directly affect network costs. For architectural guidance, see Azure Well-Architected Framework and Azure Architecture Center.
| Recommendation | Benefit |
|---|---|
| Minimize cross-region traffic by deploying workload components in the same region when latency and data residency requirements permit. | Same-region communication eliminates expensive global peering charges. You reduce data transfer costs significantly while often improving application performance through reduced latency. |
| Consolidate virtual networks where security and management requirements allow, reducing the total number of peering connections needed. | Fewer virtual networks mean fewer peering connections to maintain and pay for. You simplify network management while reducing per-connection overhead. Ensure consolidation doesn't compromise security boundaries or management separation requirements. |
| Use network security groups (NSGs) and Azure Firewall efficiently to prevent unnecessary traffic flows that incur peering charges. | Blocking unnecessary traffic at source prevents paying for data transfer that provides no business value. You optimize both cost and security by implementing traffic filtering close to traffic sources. |
| Design application architecture to minimize chatty communication patterns between regions and optimize for batch operations when possible. | Reducing the number and size of network calls decreases data transfer costs. You can often optimize application design to bundle requests, cache data locally, or process data closer to its source. |
Optimize gateway and connectivity costs
Gateways and specialized network services add significant costs. Use them judiciously and right-size based on actual traffic patterns.
| Recommendation | Benefit |
|---|---|
| Share VPN gateways across multiple virtual networks using gateway transit in hub-and-spoke topologies instead of deploying gateways in every virtual network. | Gateway consolidation eliminates duplicate gateway costs while maintaining hybrid connectivity. A single gateway can serve multiple spoke VNets through peering with gateway transit enabled. You pay one gateway hourly charge instead of multiple. To configure gateway transit, see Configure VPN gateway transit in virtual network peering. |
| Right-size VPN gateways based on actual throughput requirements rather than over-provisioning for peak capacity. | Gateway stock keeping units (SKUs) have significant price differences. You can start with lower SKUs and scale up if needed, avoiding unnecessary costs for unused capacity. To ensure adequate performance, monitor gateway metrics. |
| Use NAT Gateway for outbound internet connectivity instead of public IPs on individual virtual machines (VMs) when you have many outbound connections. | NAT Gateway provides cost-effective, scalable outbound connectivity with better performance than individual public IPs. You pay per-hour plus data processing charges, which is often more economical than many public IP addresses. For more information, see What is Azure NAT Gateway?. |
| Evaluate Accelerated Connections based on actual performance requirements for network-intensive workloads. | Accelerated Connections (SKUs A1-A8) improve connection performance but add hourly charges that vary by SKU. Only enable on workloads that genuinely need enhanced connection performance. Test performance with standard networking first before upgrading. |
Monitor and optimize over time
Network usage patterns change as workloads evolve. Set up continuous monitoring and regular optimization cycles to maintain cost efficiency.
| Recommendation | Benefit |
|---|---|
| Configure cost alerts when Virtual Network spending approaches predefined budget thresholds using Microsoft Cost Management. | Proactive notifications prevent budget overruns and enable timely adjustments to network architecture. You can respond to cost increases before they significantly affect other initiatives and maintain predictable network spending. |
| Monitor data transfer patterns using Azure Monitor and Network Watcher to identify expensive cross-region or cross-VNet traffic. | Understanding actual traffic flows enables data-driven optimization decisions. You can identify opportunities to relocate workloads, implement caching, or optimize application communication patterns. To monitor traffic, see What is Azure Network Watcher?. |
| Conduct quarterly network topology reviews to identify unused peering connections, oversized gateways, or unnecessary network services. | Regular reviews ensure network investments remain aligned with business requirements. You can decommission unused connections, right-size gateways based on actual usage, and identify consolidation opportunities. |
| Track network cost allocation per workload or business unit to drive accountability and identify optimization opportunities. | Cost visibility by workload enables teams to understand their network effect and make informed decisions. You can implement chargebacks or showbacks to drive cost-conscious behavior and justify network optimization initiatives. |
| Implement lifecycle management for network resources, automatically tagging and reviewing resources to prevent sprawl and decommission obsolete infrastructure. | Automated lifecycle processes prevent network resource accumulation that doesn't serve active workloads. You free budget from zombie resources and maintain a clean, efficient network topology. |
Best practices checklist
Use this checklist to validate your Virtual Network cost optimization strategy:
- ☑ Free VNet foundation: Virtual networks themselves are free. Focus optimization on data transfer, peering, and gateway costs.
- ☑ Hub-and-spoke topology: Implement centralized architecture to minimize peering complexity and share expensive resources.
- ☑ Regional consolidation: To avoid expensive global peering charges, keep communicating workloads in the same region.
- ☑ Gateway sharing: Use gateway transit to share VPN/ExpressRoute gateways across multiple VNets.
- ☑ Private Link for PaaS: Connect to Azure services via Private Link instead of peering when possible.
- ☑ Right-sized gateways: Match gateway SKUs to actual throughput needs, not theoretical maximums.
- ☑ Subnet peering: Use subnet level peering when only specific subnets need connectivity.
- ☑ Traffic filtering: Implement NSGs and firewall rules to prevent unnecessary data transfer.
- ☑ Cost monitoring: Track VNet-related costs with Microsoft Cost Management alerts and regular reviews.
- ☑ NAT Gateway: Consolidate outbound internet connectivity through NAT Gateway instead of multiple public IPs.
- ☑ Network Watcher: Use traffic analytics to identify expensive communication patterns and optimization opportunities.
- ☑ Lifecycle management: Regularly review and decommission unused peering connections and network resources.