With windows hybrid benefit

Umbrellar Powered by Pax8 help a lot of customers with Azure migrations and management so they can get the most out of their subscriptions. One way you can save dollars on Windows Server is to take advantage of Azure Hybrid Benefit. Read on to find out what it is and how much you can potentially save.

1. Azure Hybrid Benefit is a pricing benefit for those with either:
   Licenses with active Software Assurance purchased via any Volume Licensing agreement (Open Value/Subscription, Enterprise Agreement/Subscription, MPSA, etc) for Windows Server Standard or Enterprise Core licenses, or
2. One- or three-year Server Subscriptions purchased via CSP for Windows Server Standard Core licenses.

Maximise your license investments

Azure Hybrid Benefit helps maximize the value of existing on-premises Windows Server license investments when migrating to Azure.
Eligible Microsoft customers can save up to 40% on Azure Virtual Machines (IaaS), which is nothing to sneeze at.

However, combine that with Azure Reserved Instances, and you could potentially save as much as 80%! There’s no doubt it’s worth looking into if you want to reduce your bottom line.

How you can save

Many Microsoft customers have Software Assurance on Windows Server, meaning they can use the licenses they’ve purchased over time (License + Software Assurance, renewing Software Assurance, etc) when moving to the cloud and/or Azure.  Getting full use of past licenses with Software Assurance is a great way to reduce your spending.

Software Assurance is available for Windows Server (Standard and Datacentre) and SQL Server (Standard and Enterprise) core licenses and is really easy to set up. If you’re already running Virtual Machines (VM) in Azure without Azure Hybrid Benefit, you won’t need to spin up to a new VM. You can also receive free Extended Security Updates (ESU) when moving your environment to the cloud.

Differences between Windows Server and SQL Server

There are some differences between the way Azure Hybrid Benefit works for Windows Server and SQL Server. For now, we’ll just stick to Windows Server. If you’d like more information about SLQ Server, check out Microsoft’s Documentation page.

Rights to use Windows Server licenses:

This relates to on-premises physical or virtual servers OR virtual machines running in Azure.

With Windows Server Standard, you can use licenses either on-prem or in Azure – but not at the same time. The only exception to this rule is on a one-time basis for up to 180 days, to allow migration of those same workloads to Azure.

Windows Server Datacenter

Customers can use licenses both on-prem and/or in Azure. License requirements include:

• A minimum of 16 Core licenses must be assigned to Azure.
• A minimum of 8 core licenses must be assigned to each Azure Virtual machine.
• Additional sets of 8 Core licenses assigned to larger virtual machines.

Activating the Azure Hybrid Benefit

You can enable the Azure Hybrid Benefit on virtual machine creation or for a running virtual machine using the instructions laid out by Microsoft on their documentation page.

It’s worth noting that procuring new licenses for on-premises Windows Server (License + Software Assurance or Subscription licenses under CSP) can still reduce your Azure costs. It’s actually advantageous to purchase new licenses as CSP subscriptions instead of paying for full service in Azure!

Finally, Azure Hybrid Benefit makes the most sense for machines that are on 24/7 or long periods of the year (>9 months is usually the threshold). For more details about Azure Hybrid Benefit and how to get started, go to Microsoft’s Azure Hybrid Benefit page.

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Understanding the Microsoft Azure Hybrid Benefit

• Existing Licenses: Use on-premises Windows Server or SQL Server licenses in Azure.
• Cost Savings: Save on Azure virtual machines by applying your licenses.
• Eligibility: Requires Software Assurance or subscription-based licenses.
• Flexible Usage: Windows Server and SQL Server workloads can be used.
• Coverage: Applies to both Windows and Linux virtual machines.

Microsoft Azure Hybrid Benefit

In today’s cloud-driven world, organizations are increasingly looking to modernize their IT infrastructure while optimizing costs.

One powerful way to achieve this is by leveraging Microsoft Azure Hybrid Benefit.

This program allows businesses to maximize their existing investments in Microsoft software while transitioning to the cloud.

Azure Hybrid Benefit enables significant cost savings and supports a smoother, more efficient cloud migration process.

This guide explores the key aspects of the Azure Hybrid Benefit, including its benefits, eligibility requirements, and best practices for maximizing its value.

What is Microsoft Azure Hybrid Benefit?

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Azure Hybrid Benefit is a licensing benefit offered by Microsoft that allows organizations to bring their existing Windows Server, SQL Server, and certain Linux subscriptions to Microsoft Azure.

Businesses can save significantly on cloud computing costs by using their current licenses in the cloud. This benefit is especially valuable for organizations already using Microsoft software in their on-premises data centers and looking to migrate to the cloud without incurring additional licensing costs.

The Azure Hybrid Benefit program is designed to help businesses save on cloud infrastructure costs, ensure a smooth transition to the cloud, and maintain Azure’s flexibility and scalability.

The program’s core advantage is its ability to leverage on-premises licenses in Azure, allowing organizations to substantially reduce costs.

Core Benefits and Savings

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The Azure Hybrid Benefit program offers numerous cost-saving advantages, making it a compelling option for organizations transitioning to the cloud.

1. Cost Reduction Potential

One of the primary benefits of Azure Hybrid Benefit is its cost-saving potential. For organizations using Windows Server, the savings can be particularly impressive. Microsoft estimates that Windows Server customers can save an average of 36% compared to leading cloud providers. This is a significant reduction, especially for enterprises with large-scale IT environments.

When Azure Hybrid Benefit is combined with other cost-saving programs like Azure Reserved VM Instances, these savings can reach up to 80% over standard pay-as-you-go rates for Windows Server deployments. This combination of Azure Hybrid Benefit and Reserved Instances creates a highly cost-effective solution for businesses migrating to the cloud.

2. License Coverage

The Azure Hybrid Benefit program supports several Microsoft products and services, including:

• Windows Server Datacenter Edition
• Windows Server Standard Edition
• SQL Server Enterprise Edition
• SQL Server Standard Edition
• RedHat and SUSE Enterprise Linux Subscriptions

These products are critical components of many enterprise IT infrastructures, and leveraging existing licenses can substantially reduce the overall cost of cloud migration. The flexibility the Azure Hybrid Benefit provides ensures that the program can benefit a wide range of organizations, regardless of their specific software needs.

Read our article how to migrate to Azure and achieve cost optimization.

How Does the Azure Hybrid Benefit Work?

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Businesses must understand the licensing model and its application to different workloads in Azure to take advantage of the Azure Hybrid Benefit.

1. Windows Server Benefits

The Azure Hybrid Benefit offers an attractive cost-saving opportunity for organizations using Windows Server in their on-premises environments.

Customers can transfer their existing Windows Server licenses to Azure and pay only for the base compute rate of virtual machines (VMs). This base compute rate is equal to the Linux VM rate, which is often significantly lower than the cost of running a Windows Server VM without the Hybrid Benefit.

Businesses must have active Software Assurance or qualifying subscription licenses through commercial licensing agreements to qualify for the Azure Hybrid Benefit for Windows Server.

The benefit allows customers to deploy Windows Server VMs in Azure without incurring additional licensing charges for the operating system, thus lowering the overall cost of running these workloads in the cloud.

2. SQL Server Advantages

SQL Server customers can also achieve substantial cost savings through the Azure Hybrid Benefit. This benefit is particularly valuable for organizations deploying SQL Database and SQL Managed Instance solutions in Azure.

Using the Hybrid Benefit, businesses can reduce costs by up to 30% or more compared to the standard pay-as-you-go pricing model.

For SQL Server Enterprise Edition customers, the Azure Hybrid Benefit offers a special license exchange advantage: for every on-premises core that a business owns, it can receive four vCPUs in Azure for use in the General Purpose SKU of SQL Managed Instances or SQL Virtual Machines.

This allows businesses to fully utilize their existing licenses while optimizing their cloud deployments for performance and cost.

Key Features of Azure Hybrid Benefit

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Several key features make Azure Hybrid Benefit a powerful tool for organizations looking to reduce cloud costs and optimize their infrastructure. These features help streamline the migration process and ensure long-term cost savings.

1. Migration Rights

Azure Hybrid Benefit includes migration rights, allowing organizations to run their workloads on-premises and in Azure simultaneously for up to 180 days during the migration process. This dual-use right is crucial for organizations that need a seamless transition to the cloud, as it allows them to test and migrate workloads without experiencing downtime or service interruptions.

This flexibility ensures that businesses can continue operating in their existing environment while gradually shifting workloads to the cloud, reducing the risk associated with large-scale migrations.

2. Centralized Management

Managing licenses and deployments across an enterprise can be complex. Azure Hybrid Benefit simplifies this process, including centralized management capabilities for SQL Server workloads. Through Azure Cost Management + Billing, businesses can automatically apply the Hybrid Benefit to a variety of SQL Server deployments, including:

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

This centralized management reduces administrative overhead and ensures that organizations fully reap the benefits without manually applying them to each deployment.

Eligibility and Requirements

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Organizations must meet specific eligibility criteria to take full advantage of Azure Hybrid Benefit. Understanding these requirements is critical to ensure businesses can use the benefits effectively and without complications.

1. Software Assurance Requirement

Organizations must have active Software Assurance coverage or qualifying subscription licenses through commercial licensing agreements to qualify for the Azure Hybrid Benefit.

This is a key requirement, as it ensures that businesses have the appropriate licensing rights to use the benefit in Azure.

2. Agreement Types

Azure Hybrid Benefit is available under several different agreement types, including:

• Enterprise Agreements
• Microsoft Azure Enterprise
• Azure Government Enterprise
• Microsoft Customer Agreement

These agreements allow businesses to access the full range of Azure services and take advantage of the cost-saving benefits of Azure Hybrid Benefit.

Strategic Considerations for Optimal Use

To maximize the value of Azure Hybrid Benefit, organizations need to consider several strategic factors, including licensing management, compliance, and workload optimization.

1. Optimal Use Cases

Azure Hybrid Benefit is especially beneficial for certain types of workloads. It is most valuable for:

• Workloads running 24/7: Leveraging Hybrid Benefit can lead to substantial savings for businesses that rely on continuous operations.
• Systems operating more than nine months per year: Workloads with long-running, predictable usage patterns are ideal candidates for the Hybrid Benefit.
• Organizations with existing Microsoft licenses: Companies already using Microsoft software in their on-premises environments can use their current investments to save money in the cloud.
• Large-scale cloud migrations: Organizations planning a significant shift to the cloud can use the Azure Hybrid Benefit to reduce the cost of migrating numerous workloads to Azure.

2. Compliance and Maintenance

To maintain compliance and ensure the full benefit of the Azure Hybrid Benefit, organizations must keep track of:

• Software Assurance status: Organizations need to monitor their Software Assurance term and ensure it is active before applying the Hybrid Benefit.
• License renewal management: It’s important to manage license renewals to ensure the benefit is applicable.
• System inventory maintenance: It is essential to effectively manage Hybrid Benefit by keeping an up-to-date inventory of all systems and licenses.

Read how to manage Azure from a multi-cloud context.

Best Practices for Maximizing Azure Hybrid Benefit

To ensure that businesses get the most out of Azure Hybrid Benefit, there are several best practices to follow:

1. License Management

Organizations should use the benefit correctly to maintain an accurate license inventory, track Software Assurance expiration dates, and conduct regular compliance audits. Strategic license allocation is also key: aligning licenses with workloads to optimize cloud costs.

2. Cost Optimization

For maximum cost efficiency, businesses should:

• Combine Azure Hybrid Benefit with Azure Reserved Instances for further savings.
• Implement proper resource tagging to track usage and optimize costs.
• Regularly monitor usage patterns and strategically place workloads to ensure resources are used most efficiently.

Future Considerations

As organizations continue to migrate to the cloud, it’s essential to plan for long-term infrastructure modernization.

Azure Hybrid Benefit supports this by providing:

• Financial flexibility for cloud adoption
• Support for hybrid cloud deployments
• A gradual migration path, allowing businesses to modernize their infrastructure over time

Strategic Planning

Organizations should regularly evaluate their licensing needs, plan for Software Assurance renewals, and monitor cloud usage patterns to ensure that they are continuously optimizing costs and operations.

FAQ: Understanding the Microsoft Azure Hybrid Benefit

What is the Azure Hybrid Benefit?
It allows you to apply your existing on-premises licenses (Windows Server or SQL Server) to reduce costs when migrating to Azure.

Which licenses are eligible for the Azure Hybrid Benefit?
Licenses with active Software Assurance or subscription-based models for Windows Server or SQL Server are eligible.

How does the Azure Hybrid Benefit reduce costs?
It offers significant discounts on Azure virtual machines, as you don’t need to purchase new licenses for those workloads.

Can I use the Azure Hybrid Benefit for any workload?
The benefit is primarily available for Windows Server and SQL Server workloads for virtual machines and certain Azure services.

Is there a limit to how many licenses I can apply?
There’s no strict limit, but the benefit applies based on the number of eligible licenses you hold and the corresponding Azure instances.

Do I need to purchase additional Azure licenses?
No, if you have eligible on-premises licenses with Software Assurance, you don’t need to purchase new licenses for Azure.

Can I use the Azure Hybrid Benefit for Linux virtual machines?
The Azure Hybrid Benefit can apply to Windows and Linux virtual machines in certain circumstances.

How do I activate the Azure Hybrid Benefit?
You activate the benefit through the Azure portal by selecting the appropriate option when creating new VMs or updating existing ones.

Is the Azure Hybrid Benefit available for all regions?
The Azure Hybrid Benefit can be used in all Azure regions, but availability may vary based on specific services.

What is Software Assurance?
Software Assurance is a Microsoft program that offers benefits such as license mobility, extended support, and reduced pricing for Azure services.

Do I need to renew Software Assurance to keep the benefit?
Yes, Software Assurance must remain active to continue receiving the cost benefits in Azure.

Can I combine the Azure Hybrid Benefit with other discounts?
You can combine the Azure Hybrid Benefit with other Azure pricing options like Reserved Instances for additional savings.

How long can I use the Azure Hybrid Benefit?
You can use the benefit if you have eligible licenses with active Software Assurance or a qualifying subscription.

Does the Azure Hybrid Benefit apply to all virtual machines?
It applies to eligible virtual machines running supported Windows or SQL Server workloads.

Can the Azure Hybrid Benefit help with disaster recovery setups?
Yes, it can be used to reduce the cost of disaster recovery solutions for SQL Server or Windows Server workloads in Azure.

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