Tracking Azure Hybrid Benefit

Photo by Ian Battaglia on Unsplash

We continue with our series of blog posts on Azure Hybrid Benefit (AHB) with this post and video (below) on the important of tracking within AHB. My colleague Niamh Ni Shuilleabhain and I will summarize what AHB is, outline why tracking your AHB is important and how you can identify where the benefit is applied within your estate.

An overview of Azure Hybrid Benefit

There are 3 flavours for Azure Hybrid Benefit, namely;

· AHB for Windows Server

· AHB for SQL Server

· AHB for Linux

If you have invested in on-premises licenses for Windows Server or SQL Server, and Software Assurance is attached to those licenses, Microsoft will allow you to leverage the investment you have made in those licenses in Azure.

In doing so, you can eliminate the software rental fee associated with Windows Server and SQL Server in Azure; other costs still apply such as storage and compute costs, however, overall we estimate that the cost saving can be anything between an estimated 20–40% per Azure VM (the cost for Software Assurance is still a factor and needs to be carefully examined moving forward.)

For Linux, if you have subscription licenses for Red Hat or SUSE, AHB for Linux allows you to bring those licenses to Azure and by doing so you remove the ‘license included’ cost associated with those operating systems.

Why is Tracking in Azure Hybrid Benefit Important?

AHB as a framework has been around for a few years, however, many organisations fail to realise the importance of tracking their AHB, which includes;

1. Compliance Control. AHB is a trust-based model that may result in known and unknown risk taking that could result in unforeseen financial cost if audited. Therefore, it’s still very important to know how many licenses you own, what type of licenses they are and whether you can bring them to Azure.

2. Cost Optimisation. If you are using AHB for Windows SQL Server, do you know what resources you have used them against and are you getting the maximum benefit for the licenses that you own against the resources you have assigned them to, for example, ensuring that you have AHB against ‘always on’ and/or high utilisation resources.

In our day-to-day engagements with clients, we do encounter organisations that are not proactively tracking their AHB. It would be our recommendation that tracking is carried out monthly or quarterly, so that you limit any compliance risk to a shorter timeframe and benefit from cost optimisation expeditiously. The frequency of tracking in AHB is essential to the realisation of the benefit. It is not a ‘one and done’ exercise — it must be carried out frequently and on an ongoing basis so that you are managing out the risk and continually optimising cost.

Licensing for AHB

· Have clarity on how many licenses you have, what type of licenses you own and what licenses you can use for AHB.

· From an entitlement perspective, SQL Server core licenses can be used, not Server-side licenses.

· Dual-use rights both permanent & temporary — benefit dependent on the type of product and how it will be used in Azure.

Ways and Means of Tracking

There are various methods of tracking within AHB including automation — when you understand some of the root causes of your license imbalances, being able to automate reporting and allocation through some of the native capabilities within the Azure portal is advantageous.

Additionally, some businesses will have software asset management methodologies and tools in situ that can help you track and manage some of this risk and optimisation on an ongoing basis. Your SAM and Azure teams should work in tandem to make sure that you do not fall out-with Microsoft’s existing license terms.

How To Identify Azure Hybrid Benefit Utilisation

Windows Server & Linux

For Windows Server or Linux, it is reasonably straightforward to see where this benefit has been utilised. Within your Azure portal, there is a view for ‘Virtual Machine’ or ‘Virtual Machine Skills Sets;’ there is a column that can be added within this view for ‘OS Licensing Benefit.’ Once this has been added in, you can start to see where this benefit has been applied within your estate.

This also provides a view on the profile of the machine you are assigning the benefit to, where the benefit has been assigned (or not) and understand how the entitlement stacks up against entitlement you may own. This provides a foundation to cost optimisation opportunities, by being able to utilise the AHB for Windows Server or Linux in a more effective way.

SQL Server

For SQL, again within the Azure portal there is a column called ‘License Type’ you can quickly add in and by doing so you can view where AHB has been allocated or where perhaps you are using PAYG licensing models or ‘license included’ licensing for SQL Server. This Azure SQL view will give you an insight into where AHB has been applied to SQL Server VMs, SQL Databases and SQL Managed Instance Resources.

The portal will not give you any data on where you are assigning AHB for Data Factory Instances or where SQL Server is running on Linux. In this event, you will need custom scripting to capture the data or depending on the existence of any SAM or discovery tools and their features, these may have some native capabilities to track that benefit if there is integration with Azure.

Interestingly, Microsoft have launched a new feature, where instead of having to apply AHB at the individual resource level, their ‘Centrally Managed’ Azure Hybrid Benefit allows customers to enable AHB at an account or billing level — for example, you can set up a pool of your licenses that you have entitlement for (subscriptions or perpetual active SA licenses) and apply those to specific resources.

More Useful Tools for Tracking

Utilising Azure Resource Graph can be a great way of creating a standard set of queries to allow you to track the benefit (and a host of other metrics) that will allow you to make sure that you are optimising the benefit on an ongoing basis.

Cost Management is also another great tool within Azure that will allow you to track AHB allocation.

Azure Monitoring Alerts makes sure you are keeping track of how the benefit is being applied by setting up trigger notifications if AHB has gone beyond a certain level.

Some SAM tools in the marketplace are also starting to capture some of these new metrics that perhaps wouldn’t have been captured in the on-prem world. Examine the SAM tools you are already using and see if some of those features are included.


We are seeing Microsoft become more vocal on the various methods of tracking your AHB and by doing so, are reinforcing to customers the compliance message, as well as using AHB to its maximum benefit.

On paper, Azure Hybrid Benefit can appear relatively straightforward, however if not properly understood and managed, it can become uncontrollable. Having licensing expertise at not only the implementation stage of Azure, but on an ongoing basis can prove to be invaluable when ensuring an accurate starting point and an optimised position ongoing.

Further Information

As Microsoft license experts, we have deep expertise in the application and management of Azure Hybrid Benefit and are happy to help with any Microsoft license queries you may have. Please go to our website or contact us with any questions.

About the Author:

Karl is a Principal Licensing Consultant at Version 1, providing Microsoft license expertise to organisations globally and ensuring customers get the best value from their Microsoft assets.



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Karl O’ Doherty

Principal Licensing Consultant assisting organisations reduce software license cost & manage software license compliance