May 5, 2025

When it comes to managing cloud infrastructure, two giants emerge as the go-to choices for many cloud architects and DevOps teams – Terraform and Azure Resource Manager (ARM) templates. In this blog post, we’ll pit these two against each other in a head-to-head comparison. Whether you’re new to cloud infrastructure management or a seasoned pro, we’ll break it down in a way that’s easy to understand.

 

Meet the Contenders

 

Terraform

Terraform is an open-source infrastructure as code (IaC) tool created by HashiCorp. It allows you to define and provision infrastructure using a simple and readable configuration language. With Terraform, you declare what you want your infrastructure to look like, and Terraform takes care of making it a reality.

 

Azure Resource Manager (ARM) Templates

ARM templates are Microsoft’s answer to infrastructure provisioning. They’re JSON files that define the resources you need in Azure, along with their configuration. ARM templates are the native way to create and manage resources in Azure.

 

Round 1: Language and Syntax

 

Terraform

Terraform uses HashiCorp Configuration Language (HCL) for defining infrastructure. HCL is easy to read and write, even for those who are new to it. It’s a simple configuration language that makes your infrastructure code look more like a configuration file than a traditional script.

 

For instance, here’s a snippet in Terraform:

 

“`hcl

resource “azurerm_virtual_network” “example” {

  name                = “myVirtualNetwork”

  address_space       = [“10.0.0.0/16”]

  location            = “East US”

  resource_group_name = azurerm_resource_group.example.name

}

“`

 

ARM Templates

ARM templates use JSON, which might not be as user-friendly for those who aren’t familiar with it. JSON can get verbose, and maintaining complex templates can become a bit cumbersome.

 

Here’s an equivalent snippet in ARM template JSON:

 

“`json

{

  “$schema”: “https://schema.management.azure.com/schemas/2019-04-01/deploymentTemplate.json”,

  “contentVersion”: “1.0.0.0”,

  “resources”: [

    {

      “type”: “Microsoft.Network/virtualNetworks”,

      “apiVersion”: “2020-06-01”,

      “name”: “myVirtualNetwork”,

      “location”: “East US”,

      “properties”: {

        “addressSpace”: {

          “addressPrefixes”: [“10.0.0.0/16”]

        }

      }

    }

  ]

}

“`

 

Winner: Terraform

In the battle of syntax, Terraform takes an early lead. HCL is more human-readable and user-friendly compared to JSON.

 

Round 2: Ecosystem and Community Support

 

Terraform

Terraform boasts a vibrant community and a rich ecosystem of providers. Providers are plugins that enable Terraform to work with various cloud providers and services. You can find providers for AWS, Azure, Google Cloud, and countless other services. This means Terraform can be your one-stop-shop for managing infrastructure across different clouds.

 

ARM Templates

ARM templates are designed specifically for Azure. They integrate seamlessly with Azure services, but if you ever need to manage resources on multiple clouds, ARM templates won’t be as versatile as Terraform.

 

Winner: Terraform

Terraform wins this round due to its broader ecosystem and multi-cloud support.

 

Round 3: State Management

 

Terraform

Terraform maintains a state file that keeps track of the resources it manages. This state file helps Terraform understand the current state of your infrastructure and make necessary changes to achieve the desired state. The state can be stored locally or remotely in a backend like AWS S3 or Azure Storage.

 

ARM Templates

ARM templates don’t manage state by default. This means you’ll need to implement your own state management solution, which can be a bit more work. Azure does offer Azure Resource Manager templates (Bicep), which provide a more declarative and structured way to define resources. However, state management is still an area where Terraform excels.

 

Winner: Terraform

Terraform’s built-in state management simplifies infrastructure management, making it a more convenient choice.

 

Round 4: Version Control and Collaboration

 

Terraform

Terraform’s configuration files are plain text, making them friendly to version control systems like Git. Collaboration is straightforward as team members can collaborate on the same configuration files simultaneously.

 

ARM Templates

ARM templates are also text-based, so version control is possible. However, managing changes and collaborating on complex templates may require more effort.

 

Winner: Terraform

In terms of version control and collaboration, Terraform provides a smoother experience.

 

Round 5: Extensibility and Customization

 

Terraform

Terraform is highly extensible. You can write your own providers or use community-contributed ones. This flexibility allows you to adapt Terraform to your specific needs.

 

ARM Templates

ARM templates are more tightly integrated with Azure. While you can extend them using custom script extensions, Terraform provides a more open and flexible ecosystem for extending functionality.

 

Winner: Terraform

Terraform’s extensibility gives it the upper hand for customization.

 

Round 6: Learning Curve

 

Terraform

Terraform is known for its gentle learning curve, thanks to its user-friendly HCL syntax. Beginners can get up to speed relatively quickly.

 

ARM Templates

The JSON-based syntax of ARM templates may be less approachable for newcomers. It can take some time to become proficient in writing and maintaining these templates.

 

Winner: Terraform

For those new to infrastructure as code, Terraform is the more beginner-friendly option.

 

Round 7: Cost

 

Terraform

Terraform is an open-source tool, which means it’s free to use. However, you’ll need to consider the cost of hosting your state file, whether it’s on your own infrastructure or in a cloud-based backend.

 

ARM Templates

ARM templates are tightly integrated with Azure, and you don’t have to pay extra for state file storage. However, you’ll still incur the usual Azure service charges when deploying resources.

 

Winner: Tie

Both Terraform and ARM templates have their advantages in terms of cost. The choice depends on your specific requirements and existing infrastructure.

 

Round 8: Azure Integration

 

Terraform

Terraform provides excellent support for Azure resources, and you can manage your Azure infrastructure efficiently using Terraform.

 

ARM Templates

ARM templates are native to Azure and offer seamless integration with Azure services. If you’re all-in on Azure, this can be an advantage.

 

Winner: ARM Templates

For organizations deeply embedded in the Azure ecosystem, ARM templates might be the more straightforward choice.

 

The Verdict

 

In this showdown between Terraform vs CloudFormation Azure, Terraform emerges as the overall winner, thanks to its user-friendly syntax, rich ecosystem, built-in state management, and extensibility. However, it’s important to note that ARM templates have their place, particularly for organizations heavily invested in Azure services.

 

Ultimately, the choice between Terraform and ARM templates depends on your specific needs and preferences. You may even find that a combination of both tools works best for your organization, leveraging Terraform’s multi-cloud capabilities while capitalizing on ARM templates’ native