Picking the right infrastructure‑as‑code tool for Azure can feel like choosing the right lane on a highway. In terms of azure software development, both Terraform and Bicep have their strengths and quirks.
Here’s how to decide which tool to start with and when to switch.
More than a multi-cloud decision
Most comparisons start and end with “Terraform is multi-cloud; Bicep is Azure-only.” That distinction matters. But it’s not the only thing that influences your choice. From my experience, the real decision comes down to:
- State management – do you want a local state file and the advanced features it brings, or would you rather let Azure track state for you?
- Execution location – do you need to run code locally and call other APIs, or are server-side deployments with built-in policy checks enough?
- Ecosystem maturity – do you rely on a rich registry of modules and tools, or are you happy writing more of your own?
- Feature adoption speed – do you need day-one access to new Azure services, or can you wait for provider updates?
Understanding these dimensions will help you avoid costly rewrites. DevOps adoption is exploding. Analysts predict the market will exceed $25 billion by 2028. So the tool you choose today can shape your culture tomorrow.
Primer on the tools
If you’re new to these tools, here’s the gist:
- Terraform is an open-source IaC tool from HashiCorp. It uses HashiCorp Configuration Language (HCL) and works with thousands of providers across clouds, virtualisation platforms, and SaaS tools.
- Bicep is Microsoft’s domain-specific language introduced in 2020 as a more readable alternative to ARM templates. It transpiles into JSON behind the scenes but removes the verbosity.
Choosing the right tool is part of a long‑term DevOps strategy.
State: the silent deal-breaker
State management is the biggest functional difference I’ve encountered. Terraform keeps a local or remote state file that maps real-world resources to your configuration. This file lets you import existing resources, move resources between modules, and automatically delete items removed from code. However, it must be secured and shared correctly; mismanaging the state leads to painful drift and sleepless nights.
Bicep takes a simpler path. It compiles into ARM templates and relies on Azure’s deployment engine to track state. There is no local state file to manage or sync. That simplicity means Bicep doesn’t know whether it created a resource, so incremental deployments never delete resources on their own.
| Aspect | Bicep | Terraform |
| State file | None – Azure tracks deployment state | Required – must be secured and shared |
| Deleting resources | Never deletes automatically | Deletes removed resources when applying |
| Drift detection | Manual reconciliation | Built-in detection and imports |
Sharing a Terraform state file across a distributed team led to friction. Bicep removed that burden but required manual cleanup of unused resources.
Execution and extensibility
Bicep compiles your .bicep files into a single ARM deployment and hands it to Azure. All the heavy lifting happens on Azure’s side. This server-side execution enables pre-flight policy checks and quota validation. Until recently, Bicep could only handle Azure resources. With the Bicep extensibility feature (public preview), you can now call providers like Microsoft Graph to create Entra ID applications and other non-Azure objects.
Terraform works differently. When you run terraform plan or terraform apply, the tool reads your files locally, calculates a plan from the state file and makes API calls directly. Because execution happens on your machine or CI server, you can insert delays, run scripts, or interact with any API you need. This flexibility allows multi-cloud workflows but adds complexity.
- Bicep – Server-side deployments with automatic policy checks. Limited to Azure resources unless you use the new extensibility feature.
- Terraform – Local or CI-based execution. Supports loops with dynamic values, calls to any provider, and custom provisioners.
Cloud scope and lock-in
Bicep is unapologetically Azure-only. It uses Azure terminology and doesn’t abstract provider differences. This focus is a blessing if you live entirely in Azure. New services and resource types are available on day one, and features like managed identities and what-if deployments work out of the box.
Terraform is cloud-agnostic. You can manage Azure, AWS, Google Cloud, Kubernetes clusters, GitHub, Datadog, and more from the same HCL syntax. This breadth is perfect for hybrid environments or organisations wanting to avoid vendor lock-in. However, the Azure provider sometimes lags behind, so you might wait a few weeks for a new resource to appear.
| Scenario | Use Bicep when… | Use Terraform when… |
| Single-cloud | You’re all-in on Azure and need day-one support for new services | You plan to mix clouds or include on-premises workloads |
| Hybrid workloads | You stick to Azure Arc or native hybrid services | You orchestrate resources across clouds, hypervisors or SaaS |
| Lock-in concerns | You’re comfortable betting on Azure | You want the option to switch providers |
| Ecosystem needs | You’ll write your own modules and enjoy built-in integrations | You need a rich registry of modules and community tools |
When to pick Bicep or Terraform
Each tool shines under different conditions. Bicep often wins when:
- You’re fully invested in Azure and want day-one access to new services.
- Small teams or prototypes need simplicity; state file management feels like overkill.
- You prefer incremental deployments with no surprise deletes during refactoring.
Terraform earns its keep when:
- You manage hybrid or multi-cloud architectures across Azure, AWS, VMware, Kubernetes or SaaS.
- Large teams need advanced state features like imports and isolation.
- Mature testing and governance are critical; you rely on Terratest, policy-as-code and a rich ecosystem of modules.
Pick and move: my approach
Rather than treating Bicep and Terraform as mutually exclusive, I treat them as complementary. Here’s how I pick and move:
- Prototype in Bicep. When exploring a new Azure service, generate a template from the portal, tweak it, and deploy quickly.
- Scale in Terraform. When the project grows beyond Azure or when you need state-driven workflows, rewrite your Bicep modules into Terraform.
- Mix and match. Use Terraform for core infrastructure and Bicep for bleeding-edge services like OpenAI or Graph.
- Stay flexible. The cloud evolves quickly. Don’t be afraid to move code between tools as your needs change.
Final thoughts
There’s no one‑size‑fits‑all answer to Bicep versus Terraform. Understand how each handles state, execution, and cloud scope. Start with the tool that fits your current project, and be ready to switch as your needs evolve.
