Fordway Blog

Reducing licencing costs with Azure Hybrid Benefit

[fa icon="calendar"] Feb 8, 2018, 11:42:56 AM / by Richard Green

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In my previous post, I talked about the benefits of using Azure Instance Reservations to save money on the cost of IaaS virtual machines (VMs). There’s also an opportunity to save money by reducing duplication on your Windows Server licences.

Most people running an IaaS VM will also be running either Microsoft Windows or Linux, with some application software on top such as SQL Server. When you commit to a Microsoft Azure IaaS VM running Microsoft Windows, the cost of that virtual machine includes the Windows license. However, if you’re an enterprise client of Microsoft’s with an Enterprise Agreement you will probably already have some Windows Server licenses through that agreement. So why pay for them again in Azure? The only reason to do this would be if you intend to do away with the Enterprise Agreement and license everything through retail channels.

Instead, you can apply your Enterprise Agreement licenses to your IaaS VMs deployed in Azure. It’s done through a lesser known option called Azure Hybrid Benefit, often referred to as Hybrid Usage Benefit (HUB).

By using HUB, the price of the Azure IaaS VM ceases to include the Windows Server license element – you pay purely for the compute. And there are more benefits. You can also use the HUB option with SQL Server IaaS VMs deployed to Azure, which means you no longer pay the list price in Azure for either the Windows Server or the SQL Server application license.

Whether you can use Azure Hybrid Benefit depends on your Subscription. If you created your Azure Subscriptions using your Enterprise Enrolment Portal, your Subscription is already on-track to be used with HUB. If you created a standalone Subscription using the consumer Azure Portal and the Subscription is a Pay As You Go type then you need to go back to the drawing board: HUB only applies to Enterprise Agreement Subscriptions.

The really good news is that you can combine this with Azure Reserved Instances. You are now only paying for the compute costs and have reduced those by committing to that VM for a specific period. The Microsoft Azure site reports that you can save up to 82 percent by combining the two, although this number only applies to certain VM sizes and OS and SQL Server combinations.

To find out what your existing Enterprise Agreement licencing covers, go to the Azure Hybrid Benefit page. If you enter your licence numbers, whether they are Standard or Datacenter and what VM size you plan to deploy, the calculator will tell you how many VMs you can run.

However, there is a catch. If you have existing VMs deployed in Azure, HUB cannot be applied retrospectively (unlike Reserved Instances) as it is applied at the time at the VM is deployed. But there is a solution. In Azure, the VM itself (ignoring the storage) is a logical configuration element. By deleting the existing VM and deploying a new one using the HUB template you can attach the existing VHD file. This will bring the VM back to life in its original form and take advantage of HUB. This isn’t exactly graceful as it will mean bringing down potentially user-facing production servers, but when you work out the savings it could be worth the time and effort. Just ensure that you test it in development first.