How Misconfigured Backup Strategies Led to Skyrocketing Data Transfer Costs

Cloud cost mistakes don’t always come from overprovisioning or scaling issues—sometimes, they stem from simple network misconfigurations that go unnoticed until the bill arrives.

In this Common Cloud Cost Mistakes issue, we explore how a client’s misconfigured Private Link DNS settings and manual cross-region backup strategy led to huge egress charges—all while thinking they were using private networking. The result? Skyrocketing cloud costs and an issue no one noticed until it was too late.

How Private Link DNS Misconfiguration Led to Massive Costs

1️⃣ The Backup Setup

• Backing up on-prem workloads to Azure Storage Accounts using a third-party backup agent ✅
• ExpressRoute was in place, so they expected backups to go over private networking ✅
• They had a second backup copy going to a different Azure region (Disaster Recovery) ✅
• The backup agent was misconfigured and could not resolve the Private Link DNS name of Azure Storage ❌
• Because of this, the agent used the public internet instead of a Private Link ❌
• When replicating data to another region, they were again using the internet instead of Azure’s backbone ❌

2️⃣ What Went Wrong?

❌ DNS Misconfiguration Broke Private Link Resolution

• Private Link requires DNS resolution to point storage traffic to its private endpoint rather than the public one.
• Because the backup agent couldn’t resolve the Private Link DNS name, it defaulted to using the public endpoint, sending all backup traffic over the internet instead of the ExpressRoute.

❌ Backup Replication to the Next Region Also Used the Internet

• Instead of leveraging Storage Account Replication (GRS) or private networking, they manually copied backups over the public internet from one region to another, triggering high egress fees.

❌ No Cost Monitoring or Anomaly Alerts

• Nobody noticed the increasing egress charges because cost alerts were not configured.

3️⃣ The Cost Impact

💸 Public Internet Egress Charges: Backup data left Azure via the public internet instead of using ExpressRoute or Azure’s backbone.

💸 Cross-Region Transfers Over Public Internet: Instead of using GRS or RA-GRS, they manually copied backups between Azure regions, triggering huge egress fees.

💸 Traffic billed at Standard Outbound Rates: Every terabyte of backup data was charged as if it were being sent outside of Azure, even though it was just copied between services.

4️⃣ How This Should Have Been Done (Best Practices)

✅ Fix Private Link DNS Resolution

• Ensure DNS zones are correctly configured so the backup agent resolves storage accounts to the Private Link address instead of the public endpoint.

✅ Use Storage Account Replication Instead of Manual Transfers

• Instead of copying backups manually between regions, use Geo-Redundant Storage (GRS), which automatically replicates data at no extra transfer cost.

✅ Configure Private Endpoints Correctly

• If a backup agent needs to access Azure Storage, ensure it can resolve the Private Link DNS entry.
• Validate Private Link connectivity with Azure Private DNS zones to avoid traffic defaulting to the public internet.

✅ Use ExpressRoute for All Backup Traffic

• ExpressRoute Global Reach could have ensured traffic stayed within private networking, even across Azure regions.

✅ Enable Cost Monitoring & Anomaly Alerts

• Implement Azure Cost Alerts to immediately flag unexpected egress charges before they balloon into six-figure bills.

Avoid Costly Backup Mistakes

🚨 This DNS misconfiguration issue forced backup traffic over the public internet, leading to massive unnecessary data transfer costs.

🚨 Cross-region replication should have been done using built-in Storage Replication (GRS), not manual copying.

Cost misconfigurations like this can happen anytime, and without proper monitoring, they often go unnoticed for weeks. Ensure your cloud infrastructure is optimized not just for performance but also for cost efficiency.

Have you experienced an unexpected cloud cost spike? Please share your story in the comments, and let’s discuss how to navigate these challenges together!

Erol