Centrally managed Azure Hybrid Benefit FAQ

The centralized Azure Hybrid Benefit management experience is part of Cost Management + Billing. It automatically applies qualifying SQL Server licenses under Azure Hybrid Benefit to the following Azure resources. The total number of normalized cores (NC) created by SQL license assignment for a specific scope is applied. For more information about NC, see How Azure applies assigned SQL licenses to hourly usage.

• SQL databases
• SQL elastic pools
• SQL managed instances
• SQL virtual machines

• Azure Data Factory – SQL Server Integration Services (SSIS)
• Azure Dedicated Host

The new scope-level Azure Hybrid Benefit experience is available automatically to the following agreements:

• Enterprise agreements, including:
  • Microsoft Azure Enterprise - MS-AZR-0017P
  • Azure Government Enterprise - MS-AZR-USGOV-0017P
• Microsoft Customer Agreement - Microsoft Azure Plan - MS-AZR-0017G

Other agreement types aren't supported yet. For more information, see Prerequisites.

SQL Server Enterprise and Standard Edition core licenses with Software Assurance or core subscription licenses. For more information, see Azure Hybrid Benefit for SQL Server.

In general, your procurement or software asset management department needs to be involved in the decision about how many licenses to assign. Their involvement is needed because the number depends on how many eligible SQL Server licenses are available. You might need to buy more licenses. The decision involves a few steps:

1. Review the information available in the Azure portal about how many SQL Server licenses are applied to Azure SQL resources with resource-level Azure Hybrid Benefit selections.

2. Confirm with your procurement or software asset management department the number of licenses available to assign to Azure. Available licenses are either not in use on-premises or they are in use with a workload actively migrating from on-premises to Azure. Licenses can be used in both places for up to 180 days during migration. Review the Transition scenario examples.

3. If there are only enough licenses available to cover your existing Azure Hybrid Benefit license usage, you might decide to assign that number for continuity. If there are more licenses available, you might decide to assign more licenses to cover all Azure SQL usage and even expected usage growth. By optimizing assigned licenses to cover your steady or growing usage, you can save your organization more money. Finally, if there aren't enough licenses available to cover your existing Azure Hybrid Benefit license usage, you have two choices:

   • Assign fewer licenses, which might increase your Azure bill.
   • Engage within your organization to either free-up or acquire more licenses so that you can assign the right amount.

After you assign a license and set a review date, the license assignment automatically expires 90 days after the review date. The license assignment becomes inactive and no longer applies 90 days after expiration.

Microsoft sends email notifications:

• Ninety days before review date
• Thirty days before review date
• Seven days before review date

Before the license assignment expires, you can set the review date to a future date so that you continue to receive the benefit. When the license assignment expires, you're charged with pay-as-you-go prices. To change the review date, use the following steps:

1. Sign in to the Azure portal and navigate to Cost Management + Billing.
2. Select a license assignment that you want to change the review date for.
3. Select the review date.
4. Fill the review date and select Save.

No notification is sent on the review date.

Expiration notification emails are sent 30 days before expiration and again on the expiration date. The sending email address is azure-noreply@microsoft.com. You might want to add the email address to your safe senders or allowlist.

Emails are sent to different people depending on your purchase method:

• Customers with EA subscriptions
  • Notifications are sent to the EA notification contacts, EA admin, reservation owners, and the reservation administrator.
• Customers with Microsoft Customer Agreement (Azure Plan)
  • Notifications are sent to the reservation owners and the reservation administrator.

The new approach of centrally managing Azure Hybrid Benefit at a scope-level supports SQL Server in Azure Virtual machines. However, it’s essential that you have enabled automatic registration of the self-installed SQL server images with the IaaS extension before you assign SQL licenses. The experience includes a feature that informs you about current usage of Azure Hybrid Benefit. And, the usage of SQL licenses that aren’t discounted. Assigning the number of SQL Server licenses at the level of the current usage ensures that you don't experience unexpected pay-as-you-go charges. Because the unregistered SQL VMs aren’t recognized as SQL resources, registering them with the IaaS extension after you begin assigning licenses at a scope-level could lead to the license assignments being insufficient to cover the newly recognized SQL VMs. In that case, those new SQL VMs from registration might incur unexpected pay-as-you-go charges.

For more information about how to enable automatic IaaS registration, see Register SQL VMs in Azure with the SQL IaaS Agent extension.

To get more information about the total number of unregistered SQL Server VMs in each subscription, you can use the SQL license usage PowerShell script.

The SQL Server part of your bill is a function of Azure SQL resource usage (vCores) and how much Azure Hybrid Benefit is used (licenses that cover the vCores). When your Azure SQL resource usage is steady and remains consistent and you centrally assign the same number of licenses to the scope, your bill doesn't change. If some usage is currently pay-as-you-go and you assign more licenses, your bill gets smaller. It's smaller because you're getting more of a discount, assuming that your usage is stable.

Azure applies the software discount every hour to the SQL Server resources in the selected scope. If the SQL Server license assignments are sufficient to cover all SQL Server resources in that scope, then the license charge is zero for that hour. If coverage is insufficient to cover all SQL resources in the selected scope, some resources are charged for SQL Server at the pay-as-you-go price. The monthly bill shows the cumulative SQL Server software cost for each resource in the scope. If a specific resource is consistently discounted during the entire billing period, its total SQL Server software cost is zero. If new deployments result in the aggregate core size of the SQL Server resources exceeding what the assigned licenses can cover, you get an increase of the monthly pay-as-you-go cost.

For more information about how the scope-level license experience applies Azure Hybrid Benefit to SQL Server resources, see What is centrally managed Azure Hybrid Benefit??

When beginning to centrally manage Azure Hybrid Benefit at a scope-level, we recommend that you talk to the people that manage resources in the associated scopes. The option to use Azure Hybrid Benefit for those resources becomes unavailable. In the Azure portal, the option is disabled. The API continues to include the option, but it's inoperable because scope-level management takes precedence. The billing admin within the new scope-level management experience manages the discounts associated with Azure Hybrid Benefit.

When you use the new experience in the Azure portal, you're simply assigning qualified SQL Server licenses to Azure, as is your right. Your commitment is to use the capability compliantly. For example, only assign licenses to Azure that aren't already in use elsewhere.

If you try the new approach for centrally managing the benefit at a scope-level and decide it isn’t for you, you can opt out by removing the associated license assignments. When you remove all your license assignments for a given scope, then you're fully opted out of the capability for that scope. That means the resource-based Azure Hybrid Benefit selections are available again to the users that deploy and manage SQL resources. If Azure Hybrid Benefit was enabled for a resource before transitioning it to the scope-level managed license experience, the state is preserved for the resource. If you decide to opt out of the scope-level managed license experience, the original discounts take effect immediately.

You can track your usage of the assigned SQL Server licenses in Cost Management > Reservations + Hybrid Benefit. For more information, see Track assigned license usage.

The scope-level managed license experience is optimized for SQL Server core licenses with Software Assurance and core subscription licenses. It doesn’t currently support Windows Server or the Server + Client Access Licenses version of SQL Server. Concerning the latter, you can continue to use License Mobility through Software Assurance. Also, don’t hesitate to reach out to your Microsoft account team to see how they can help.

You can enable Azure Hybrid Benefit for each individual resource, for example an Azure virtual machine. Managing Window Server licenses at a scope level isn't currently supported.

Next steps

Learn more about Azure Hybrid Benefit:

• What is centrally managed Azure Hybrid Benefit?