Microsoft’s data and analytics platform, Fabric, reveals cohesive pricing, intensifying competition with Google and Amazon

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Today, Microsoft has delivered on its commitment to introduce a more straightforward and cost-effective pricing structure for its Microsoft Fabric suite, a comprehensive platform for analytics and data workloads.

The pricing hinges on the total computing and storage a customer utilizes, as confirmed by VentureBeat. It will not necessitate clients to pay separately for distinct buckets of computing and storage for each of Microsoft's various services.

This strategic maneuver increases the competitive pressure on rivals like Google and Amazon, who are in a fierce battle with Microsoft for market dominance. These competitors offer analogous analytics and data products based on their own cloud systems, but they charge customers separately for each discrete analytics and data tool used on their clouds. While Google has developed its own fabric solution called Google DataPlex to prevent bucket charges, Google's analytics services aren't as comprehensive, says Forrester analyst Noel Yuhanna.

The pricing chart, revealing uniform pricing for computing and storage across Fabric, is expected to be unveiled tomorrow on Microsoft's blog. An example of the pricing for U.S. West 2, covering part of the West Coast, was procured early Wednesday by VentureBeat and is included at the end of this article.

The pricing reform follows Microsoft's announcement last week about integrating its varied data and analytics tools into the single Fabric suite. The suite combines six distinct tools, such as Azure Data Factory, Azure Synapse Analytics, and Power BI, into a unified experience and data structure. The service is provided as software as a service (SaaS) and is intended to assist engineers and developers in more efficiently extracting data insights and presenting them to business decision-makers.

Fabric revolves around a centralized data lake known as Microsoft OneLake that houses a singular copy of data. OneLake is constructed around the open-source Apache Parquet format, enabling a unified approach to store and retrieving data across databases. All Fabric workloads are automatically connected to OneLake, like all Microsoft 365 applications are linked to OneDrive.

This is where the cost savings come into play. OneLake eradicates the need for developers, analysts, and business users across a company to generate data silos by setting up and configuring their own storage accounts for the diverse tools they employ.

For instance, when a user of Microsoft's business intelligence tool Power BI wants to run analysis on a Microsoft Synapse data warehouse, they no longer send a SQL query to Synapse. Power BI "simply accesses OneLake and fetches the data," says Arun Ulagaratchagan, Microsoft's Corporate VP of Azure Data, in a conversation with VentureBeat on Tuesday.

"This does two things for customers," he elaborates. "Firstly, it results in a substantial performance acceleration, as if there's no SQL query being executed, it simply runs data sharing the same open format across both Synapse and Power BI."

He continues, "Secondly, it results in significant cost savings for customers. As there are no SQL queries being made and thus no charges for them, this lake-centric and open architecture concept is highly attractive to customers because they don't need to be concerned about vendor lock-in or costs accumulating."

Any unutilized compute capacity on one workload can be used by any of the other workloads.

Fabric also introduces some innovative features. Microsoft will soon add Copilot, a chatbot utilizing generative AI, to every product interface within Fabric. This will empower developers and engineers to use natural language to query data or to generate data flows, pipelines, code, and construct machine learning (ML) models.

Additionally, Fabric supports a multi-cloud environment. Through a feature called "Shortcuts", OneLake can virtualize data lake storage in Amazon S3 and Google storage (coming soon).

Microsoft also introduced Data Activator, a no-code solution that enables business analysts to automate actions based on data. For instance, a sales manager can receive a notification if a particular client falls behind on their payments.

In unveiling Fabric last week, Microsoft indicated that pricing would be introduced in a separate stage (with the formal release expected tomorrow). This approach benefits customers financially as Microsoft no longer obliges them to pay several separate fees for each of the individual tools. For example, customers would be charged once if they used Power BI, again if they used Microsoft’s analytics tools, and yet again if they used Microsoft’s warehousing tools.

Microsoft further stated that a single security model would be implemented for OneLake, where all applications enforce a singular security management system on the data as they process queries and jobs.

Ulagaratchagan revealed that he had proposed the concept of Fabric to 100 of Fortune 500 companies over recent years, and chief data officers told him they were “tired of paying what they perceive as an integration tax.”

Clients seeking simplicity and speed

This so-called "integration tax" was not just imposed by separate products from Microsoft, but also by the multitude of other vendors selling data and analytics products that enterprise companies require.

“This is why we introduced Microsoft Fabric: To provide customers with a comprehensive analytics platform that spans from the database to the business user making decisions, and to give every developer an opportunity to sign up within seconds and gain tangible business value within minutes,” said Ulagaratchagan.

Amalgam Insights analyst Hyoun Park stated that Microsoft's move puts pressure on Amazon and Google, its two biggest competitors in the cloud who have also been charging customers fees for separate buckets of services they offer.

“For Amazon, that could be 200 different buckets, which is part of what makes cloud cost so challenging,” Park mentioned.

An integrated package of capabilities

Fabric also increases the pressure on some major vendors that only offer one part of the analytics and data stack, Park suggested. For instance, it poses a challenge to Snowflake, a data warehouse that uses its own proprietary data formats and requires customers to transform their data to use in other applications. Similarly, it raises concerns for business intelligence vendors like Qlik, TIBCO, and SAS.

“Part of the innovation here is that Microsoft is offering all of these as an integrated package of capabilities,” Park said. “And as simple as that sounds, it’s not something that most data and analytics vendors can provide.”

On the flip side, the more ambitious global offering may make it more challenging for Microsoft to sell, according to Park.

By amalgamating products into one, Microsoft's Fabric is no longer targeting distinct products to different roles within an organization. Microsoft will now need to sell to the executive suite. Until now, engineers might have sought to buy Microsoft’s Data Factory product, analysts might have advocated for Microsoft’s Power BI product, and developers may have desired Microsoft Synapse.

“This is definitely pitched towards executive sales because no one below the C-suite can authorize this,” Park observed.

However, he noted that Microsoft is well-equipped to make that pitch.

Anticipated pricing changes

Here's what Microsoft announced about pricing:

Rather than provisioning and managing separate compute for each workload, with Microsoft Fabric, a bill is determined by two variables: The amount of compute provisioned and the amount of storage used.

Compute: A shared pool of capacity that powers all capabilities in Microsoft Fabric, from data modeling and data warehousing to business intelligence. The pay-as-you-go model is applied (per-second billing with a one-minute minimum).

Storage: A singular location to store all data. Pay-as-you-go ($ per GB / month).

By purchasing Fabric capacity, customers will receive a set of capacity units (CUs). Capacity units (CUs) are units of measure representing the required pool of compute power. Compute power is needed to run queries, jobs, or tasks. The consumption of CUs is highly correlated with the underlying compute effort required for the tasks performed during the processing time by the capability. Each capability and the associated queries, jobs, or tasks have a unique consumption rate.

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