Skip navigation

Azure Reserved Virtual Machine Instances

Reserve virtual machines in advance and save up to 80 per cent

  • Exchange or cancel reservations as your needs evolve
  • Easily purchase in a few steps
  • Automated management of Azure RIs with instance size flexibility
  • Budget and forecast better with upfront payment for one-year or three-year terms
  • Get prioritised compute capacity in Azure regions
  • Monthly payment options at no extra cost*

More cloud, less cost

Significantly reduce costs – up to 72 per cent1 compared to pay-as-you-go prices – with one-year or three-year terms on Windows and Linux virtual machines (VMs). When you combine the cost savings gained from Azure RIs with the added value of the Azure Hybrid Benefit, you can save up to 80 per cent2.

Lower your total cost of ownership by combining Azure Reserved Instances with pay-as-you-go prices to manage costs across predictable and variable workloads. In many cases, you can further reduce your costs with reserved instance size flexibility.

What’s more, you can now improve budgeting and forecasting with a single upfront payment, making it easy to calculate your investments. Or, lower your upfront cash outflow with monthly payment options at no additional cost.

Read the FAQ

1The 72 per cent saving is based on one M32ts Azure VM for SUSE Linux Enterprise + 24x7 Support OS in the West US 2 region running for 36 months at a pay-as-you-go rate of ~$2085.61/month; reduced rate for a 3-year reserved instance of ~$592.27/month. Azure pricing as of 6 January 2021. Prices subject to change. Actual savings may vary based on location, instance type or usage.

2The 80-per cent saving is based on the combined cost of Azure Hybrid Benefit for Windows Server and 3-year Azure reserved instance. The estimate does not include Software Assurance costs. Sample annual cost comparison of one D8s v4 Windows Server VMs in US West 2 Region running for 36 months at a pay-as-you-go rate of $106.53/month; reduced rate for a 3-year reserved instance with Azure Hybrid Benefit of ~$548.96/month. Azure pricing as of 6 January 2021. Prices subject to change. Actual savings may vary based on location, instance type or usage.

Simplicity meets flexibility

Select and purchase Azure Reserved VM Instances in three easy steps – specify your Azure region, virtual machine type and term (one year or three years) – that’s it.

While Azure Reserved VM Instances require making upfront commitments on compute capacity, they also provide flexibility should your business needs change. Easily exchange or cancel reserved instances at any time.

  • Exchange reserved instances across any region and any series as your workload or application needs change.
  • Cancel a reserved instance at any time and return the remaining months to Microsoft – up to the yearly limit – for an early termination fee.

Azure Reserved VM Instances can be assigned at the enrolment or subscription level, so you can manage reserved instance usage at an organisational or individual department level. Assignments are easy to change post-purchase also.

Optimise your reservation with instance size flexibility

Your business and applications requirements continuously evolve, so committing to a specific VM size ahead of time – to take advantage of the price discounts that Azure Reserved VM Instances offer – can be limiting.

Simplify the management of reserved instances by choosing to optimise for instance size flexibility. With instance size flexibility, Azure can automatically apply your reserved instances to other VM sizes within the same group and region. You’ll spend less time managing your reservations and you may also reduce costs. Let Azure increase your overall reserved instance usage while you focus on innovative projects that can fuel business growth.

This benefit applies to both Windows and Linux VMs.

Learn more about instance size flexibility

Reserve compute capacity in advance with on-demand capacity reservations

On-demand capacity reservations, now in preview, enable you to reserve compute capacity for one or more virtual machine size(s) in an Azure region or Availability Zone for any length of time. You can create and cancel an on-demand capacity reservation at any time, no commitment is required. The ability for you to access compute capacity – with SLAs* and ahead of actual VM deployments – is particularly important to ensure the availability of mission-critical applications running on Azure. Use capacity reservations to meet your business continuity and disaster recovery needs. Combine capacity reservations with Reserved Virtual Machine Instances to greatly reduce costs.

Learn more

*SLAs will be offered when on-demand capacity reservations become generally available.

FAQ

Reserved Virtual Machine Instances

  • Purchase one-year or three-year term Azure Reserved VM Instances directly in the Azure portal, and pay with a single, upfront payment or on a monthly basis. The monthly payment option is available at no extra cost. However, if you’re in a non-US-dollar market, your monthly payment amount may vary depending on the current month’s market exchange rate for your local currency.

  • Azure Reserved VM Instances for pay-as-you-go subscriptions are not available in Argentina, Brazil, Hong Kong, India, Indonesia, Liechtenstein, Malaysia, Mexico, Russia, Saudi Arabia, South Africa and Turkey.
  • Go to the VM section in the Azure management portal, click on a VM and get the VM size information. Provide this size in the reserved instance purchase. The reserved instance discount is automatically applied to VMs matching the attributes and quantity of the Azure Reserved VM Instance.

    Alternatively, if you are an Enterprise Agreement (EA) or web direct customer, you can download your usage file and refer to Service Type value in the “Additional info” section of the usage file to get the VM size information.

  • Yes. In the reserved instance purchase experience, Microsoft will make recommendations based on your last 30 days of usage and your savings potential.

  • Please refer to your usage file to get details regarding your reserved instance discount. The VMs that get the reserved instance benefit will have the Azure Reserved VM Instance details in the “Additional information” section of the usage file. You can also get the same information from the usage APIs.

    See more information for EA customers.

    See more information for web direct customers.

    To view all purchases, go to the reservation blade in the Azure portal.

  • For Enterprise Agreement (EA) customers, Azure prepayment will be used first to purchase Azure Reserved VM Instances. In scenarios where EA customers have used all of their Azure prepayment, Azure Reserved VM Instances can still be purchased, and those purchases will be invoiced for the single, upfront payment on their next overage bill.

    For customers purchasing via Azure.com, at the time of purchase, the credit card on file will be charged for the full upfront payment of the Azure Reserved Instances.

  • You can assign Azure Reserved VM Instances benefits at the enrolment or subscription levels, and easily change assignments post purchase, as necessary. Assignment allows you to decide whether the reserved instance is applied at the Azure account/enrolment or subscription level. This gives you flexibility for savings. For example, if you want to buy reserved instances to save money for your organisation, you can assign all Azure Reserved VM Instances at the account level. Conversely, if a business unit, such as finance, wants to buy an Azure Reserved VM Instance for just its own use, it can be assigned to a subscription where only that group can take advantage of the savings.

  • The Azure Reserved VM Instances term starts immediately after purchase. Currently, you can’t purchase Azure Reserved VM Instances that start at a future date. The Reserved VM Instances pricing benefit will immediately apply to any existing running VMs that match the data centre location and VM instance, depending on how you scope your Reserved VM Instances to a specific subscription or at the enrolment/account level.

  • Azure Reserved VM Instances provide a single price for each VM size in a region. There’s no requirement to choose an operating system when purchasing a Reserved VM Instance. If Windows Server is deployed on the VM, you can either use the Azure Hybrid Benefit or pay the Windows Server licensing rate. For more information, visit the Azure pricing page.

  • There are two options for adding Windows Server to an Azure Reserved VM Instance. The first option is to use the Azure Hybrid Benefit for Windows Server. If you have Windows Server with Software Assurance on-premises, you can assign these licences to the Azure RI. There will be no charge within Azure for Windows Server. You’ll be responsible for continuing to pay for the Windows Server licence plus Software Assurance (called L/SA), Software Assurance (SA) or on-premises subscription as long as the Azure Hybrid Benefit is used. The second option is to add Windows Server using the Windows Server hourly meter. If you can’t take advantage of the Azure Hybrid Benefit, Windows Server licensing costs will be charged when the VM is active, based on the number of cores the VM is using.

  • Select the ‘Reservations’ menu on the left side of the Azure portal to view all the Azure Reserved VM Instances associated with your account. All the details associated with the Azure Reserved VM Instances that you have purchased will be displayed on the right.

  • An exchange allows you to receive a pro-rated refund based on the unused amount, which applies fully to the purchase price of a new Azure Reserved VM Instance. A cancellation terminates your Azure Reserved VM Instance and you’ll receive a pro-rated refund based on the remaining term of the Azure Reserved VM Instance minus a 12 per cent early termination fee.

  • There’s no limit on the number of exchanges you can make. Additionally, there’s no fee associated with an exchange. The main restriction is the following: the new Azure Reserved VM Instances purchased must be of equal or greater value than the pro-rated credit from the original Azure Reserved VM Instances. Additionally, Azure Reserved VM Instances can only be exchanged within the same Azure service, such as a VM for a VM.

  • You can cancel an Azure Reserved VM Instance at any time (up to $50000 per year). Cancelling allows you to return the remaining months of an Azure Reserved VM Instance back to Microsoft. Currently, we are not charging an early termination fee, but in the future, there will be a 12 per cent early termination fee for cancellations.
  • Within the management portal, view the inventory of Azure Reserved VM Instances. Click on an instance and two buttons will appear in the command bar labelled “Refund” and “Exchange”. Once selected, a support ticket, prepopulated with all of the Azure Reserved VM Instance details, will open. Once submitted, the request will be processed, and an email will be sent to you to confirm completion of the request.

    • Azure Reserved VM Instances can be applied to VM Scale Sets.
    • Azure Reserved VM Instances can be applied to Azure Batch user subscriptions mode.
    • Azure Reserved VM Instances aren’t available for A-series, Av2-series or G-series.
    • Azure Reserved VM Instances don’t apply to promo VMs.
  • You will receive email notifications 30 days prior to expiration, and again on the expiry date. Once the reserved instance has expired, deployed VMs will continue to run and will be billed at the then current pay-as-you-go rate.

  • While Azure Reserved VM Instances offer prioritised capacity, they don’t guarantee that capacity will be available for your VMs. The prioritised capacity will be for a VM SKU in the region, but it doesn’t prioritise capacity for a specific availability set or VM Scale Set. In the event that you need to deploy in a different region or change the size or family of your RI, Azure Reserved VM Instances offer industry-leading flexibility with the ability to exchange your purchase for any other Azure Reserved VM Instance that we offer.

  • Instance size flexibility is a feature associated with Azure Reserved VM Instances. Instance size flexibility automatically applies the Reserved Instance savings to any VM that you use within the same region and within the same Azure RI ‘VM group’. Instance size flexibility can apply your RI purchases for the VMs that are not currently being used. For example, if you’ve purchased a D8s_v3 RI in the East US region, instance size flexibility will look to apply the 8-cores RI benefit to any other Ds_v3 VMs running in the same East US region. That could be a combination of four 2-core VMs (D2s_v3) or two 4-core VMs (D4s_v3), or covering half the cost of a single 16-core VM (D16s_v3). The reserved instance discount is applied on a first come, first served basis. Therefore, if usage for D2s_v3 comes to the billing system before D8s_v3, the RI benefit will apply to D2s_v3.

    As a result, if you need to resize a VM or change the selection of a VM already part of a pre-paid RI, Azure can automatically apply your RI benefit across your existing VMs within the same ‘VM group’ and region. And you do not have to first return the RI to Microsoft or reset the RI period. Please refer to the documentation for a comprehensive overview.

  • An Azure RI ‘VM group’ is simply a list of VMs to which instance size flexibility can be applied. A VM group is not aligned with the existing Azure VM series. Please refer to the documentation for a list of RI VM groups and additional details.

**The 80% saving is based on the combination of Windows Server and three-year Azure Reserved Instance. The estimate does not include Software Assurance costs. Sample annual cost comparison of two D2V3 Windows Server VMs. Savings based on two D2V3 VMs in US West 2 Region running 744 hours/month for 12 months; Base compute rate at SUSE Linux Enterprise rate for US West 2. Azure pricing as of 04/24/2018. Prices subject to change. Actual savings may vary based on location, instance type or usage.

On-demand capacity reservations

  • Purchase on-demand capacity reservations directly in the Azure portal or via APIs. Capacity reservations for your VM are billed at pay-as-you-go rates. You can create and cancel an on-demand capacity reservation at any time, no term commitment is required.
  • The price of your on-demand capacity reservation is the same as the price of the underlying Azure VM associated with the reservation. When using capacity reservations, you will be charged only for the VM size you selected at pay-as-you-go rates, whether the VM has been provisioned or not. Visit the Windows and Linux VM pricing pages for more details.
  • No, you will only get charged once for the on-demand capacity reservation.
  • Yes. You can apply existing or future RIs to on-demand capacity reservations and receive RI discounts. Available RIs are applied automatically to reserved capacity the same way they are applied to Virtual Machines.
  • Both RIs and on-demand capacity reservations are applicable to Azure VMs. However, RIs provide discounted reservation rates for your VMs compared to pay-as-you-go rates as a result of a term commitment: 1- or 3-year terms. Conversely, on-demand capacity reservations do not require a commitment. You can create or cancel a capacity reservation at any time. However, no discounts are applied, and you will incur charges at pay-as-you-go rates after your capacity reservation has been successfully provisioned. Additionally, unlike RIs, which prioritise capacity but do not guarantee it, when you purchase an on-demand capacity reservation, Azure sets aside compute capacity for your VM and provides an SLA guarantee.
  • Typical scenarios include business continuity, disaster recovery and scale-out of mission-critical applications.

Reserve virtual machines in advance and save up to 80 per cent