Azure Dedicated Host pricing

You will pay the Pay-as-you-go rate for every hour the host is provisioned, and you will pay for the entire host regardless of the number of VM instances that are running on the host. Any additional charges, such as software licences, are charged separately.

The software licences are billed separately at individual VM level based on the usage. Eligible customers can leverage the Azure Hybrid Benefits to save on licences.

As the hardware is dedicated to you, the outsourcing software management terms applicable to Windows server and SQL server licences acquired prior to 1 October 2019 permit you to allocate your existing licences to Azure Dedicated Host, just as you would license a server in your own data centre. Eligible customers can also use the Azure Hybrid Benefit for savings on Azure Dedicated Host deployments. Learn more on the Azure Hybrid Benefits page.

In general, you can run different VM sizes on the same dedicated host. For example, you can deploy D2s v3 and D16s v3 VMs to the same host. However, there are some exceptions (e.g. the NVasv4_Type1 Dedicated Host SKU.) In any case, you cannot deploy VMs from different VM series (e.g. Dsv3 and Esv3). Please refer to the documentation for more details and up-to-date information.

The outsourcing software licensing terms applicable to Windows Server and SQL Server licences acquired before October 1, 2019, allow you to allocate your existing licences to Dedicated Host. If you’re eligible for Azure Hybrid Benefit, save more on Dedicated Host deployments. If you purchased new licences after October 1, 2019, you may allocate them to Azure only via Azure Hybrid Benefit. You’ll need Software Assurance or subscriptions with equivalent rights to apply those licences to Dedicated Host. Read the licensing FAQ for details.

Azure Hybrid Benefit applies to Windows Server Standard/Datacentre licences and SQL Server Standard/Enterprise Core licences with Software Assurance or subscription licences with equivalent rights.

Yes, you'll get three years of free extended security updates for Windows Server and SQL Server 2008/2012 and 2008/2012 R2 running in Dedicated Host after the end of support.

Yes, you do. Under Azure Hybrid Benefit programme, when you apply your existing Windows Server Datacentre licences or SQL Server Enterprise edition licences with Software Assurance to all the physical cores available to you on any given Dedicated Host server, you are granted unlimited virtualisation rights. For example, if you have 32 existing Windows Server Datacentre licences with Software Assurance on premises, you can use the same 32 licences to install on a Dedicated Host as many Azure VMs running Windows Server as you want, subject to the physical capacity of the underlying server. You should license only the available physical cores on each Dedicated Host that you plan to provision (for example, 32 cores for a Dsv3 Type 1 Dedicated Host).

The available physical cores are calculated by dividing the available vCPUs in the host (listed on the pricing page) by the vCPU:core value for each VM series (see the Azure compute unit documentation). Most Azure VMs available on Dedicated Host offer a vCPU:core ratio equal to 2. For example, an Esv3 series Type 1 Dedicated Host has 32 available physical cores and a vCPU:core ratio equal to 2 and can host up to 64 vCPUs.

With unlimited virtualisation rights you can substantially reduce your Windows Server and SQL Server licensing costs. Instead of licensing each Azure VM based on the number of vCPUs each VM has or using Azure Hybrid Benefit on each VM that you deploy on Azure Dedicated Host, you can license the entire set of available physical cores on each dedicated host. For example, if you have 32 existing Windows Server Datacentre licences purchased before October 1, 2019, and you need to deploy 32 Dsv3 VMs each with 2 vCPUs on Azure Dedicated Host Type 1, you'd need:

• 256 Windows Server Datacentre licences if you took advantage of Azure Hybrid Benefit while applying the benefits at the VM level.
• 40 Windows Server Datacentre licences if you applied the outsourcing rule and licensed the entire number of physical cores that Azure Dedicated Host Type 1 has.
• Only 32 Windows Server Datacentre licences if you use Azure Hybrid Benefit unlimited virtualisation rights on the same host.

Additionally, you can use concurrently on Azure Dedicated Host and your on-premises licensed servers the same licences for up to 180 days.

For SQL Server, you'll need the Enterprise edition and active Software Assurance or subscription licences to be eligible for unlimited virtualisation. For Windows Server, you'll need the Datacentre edition, and, if you use licences acquired after October 1, 2019, you’ll also need active Software Assurance or subscription licences to be eligible for unlimited virtualisation on Dedicated Host.

Windows Server Datacentre licences purchased before October 1, 2019, have unlimited virtualisation rights based on licence-only rights. Licences acquired after that date have unlimited virtualisation rights only by virtue of Azure Hybrid Benefit.

When allocating SQL Server or Windows Server licences to a Dedicated Host using Azure Hybrid Benefit, you only have to license the available physical cores on the host (for example, 32 cores for an Esv3 series Type 1 Azure Dedicated Host).

When allocating Windows Server licences purchased prior to October 1, 2019, to the host, without using Azure Hybrid Benefit, you must license all of the physical cores of the host (for example, 40 cores for an Esv3 series Type 1 Azure Dedicated Host).