Hybrid benefits

Introduction

Azure Hybrid Benefit (AHB) is a cost-saving feature provided by Microsoft Azure that allows users to use their existing on-premises Windows Server or SQL Server licenses with Software Assurance when running workloads in Azure. By applying these licenses, users can significantly reduce the overall cloud costs.

The Hybrid benefits feature in Cost Analyzer enables virtual machines (VMs) and virtual machine scale sets (VMSS) to utilize existing Windows Server licenses, reducing operational costs.

This feature provides visibility into resources where licenses are applied and highlights potential resources where licenses can be applied, helping administrators optimize license usage and manage costs efficiently.

Resources with benefits applied

• Within the Hybrid benefits section, the Resources with benefits applied tab provides a consolidated view of all Virtual Machines (VMs) and Virtual Machine Scale Sets (VMSS) leveraging Azure Hybrid benefit. The listed resources are linked to eligible existing Windows Server or SQL Server licenses, applied either at the time of deployment or subsequently.

• The tab displays the actual cost incurred by each resource during the previous month and specifies the license type applied. This visibility enables administrators to effectively track license usage and associated cost impact.

• The full dataset can also be exported in Excel format to facilitate offline analysis, reporting, and compliance reviews.

Potential resources

• The Potential resources tab lists Virtual Machines (VMs) and Virtual Machine Scale Sets (VMSS) that are not currently utilizing Azure Hybrid benefit. These resources may be eligible to leverage existing Windows Server or SQL Server licenses to reduce costs and improve license utilization.

• This view enables administrators to identify cost optimization opportunities and address licensing gaps proactively. The complete dataset can also be exported in Excel format to support offline analysis, reporting, and governance activities.

Ignore a potential resource

Administrators can choose to ignore a potential resource either until a specified date or indefinitely. This capability allows teams to defer licensing decisions when immediate action is not required.

Steps to ignore a potential resource are as follows:

1. In the Potential resources tab, select the resource to exclude, and then click Actions > Ignore.

3. Choose one of the following options:
   • Ignore always to exclude the resource indefinitely.
   • Ignore until to exclude the resource until a specified date.
4. (Optional) Enter a justification to document the reason for ignoring the resource. This information is visible to other team members for transparency and tracking purposes.
5. Click Continue to confirm the selection.

While a resource is marked as ignored, it is excluded from Potential resources tab. However, it will still be available under the Ignored hybrid benefits potential resources list and can be accessed from Actions -> View ignored, ensuring ongoing visibility and enabling reassessment at any time.

Cost intelligence view

• The Cost intelligence view structures resource data into distinct categories and visual sections, providing users with a detailed overview of cost distribution and utilization. It highlights key optimization opportunities by identifying areas of high or low resource efficiency.

• Through these categorized insights, users can easily monitor spending patterns, evaluate cost performance, and take data-driven actions to optimize resource usage and reduce overall expenses.

How to access this view?

1. Navigate to the following path within a cost management group: Optimization -> Hybrid benefits -> Resources with benefits applied / Potential resources
2. Click the View resource details icon next to a recommended resource to access its Cost intelligence view.

Key capabilities

1. Cost review

• The Cost review section offers interactive charting tools for examining cost trends across various time frames. Users can analyze spending behavior, detect inefficiencies, and leverage insights to optimize resource utilization and manage cloud expenditure effectively.

2. Rightsizing

The Rightsizing section offers visual insights into resource utilization and highlights the current and recommended SKU, with the option to apply the recommended SKU instantly.

3. Reservation

The Reservation section visualizes resource usage and shows the current and recommended SKU, including available one-year and three-year reservation commitments.

4. Related resources

The Related resources section lists all resources linked to a given Azure resource, along with their amortized costs for the past 30 days, providing insights into spending and resource relationships.

5. AI Agents

The AI Agents section supports multiple AI agents to automatically assess resources, uncover usage patterns, and deliver recommendations for optimized performance, cost efficiency, and resource utilization.

With these AI Agents, users can:

• View AI-generated resource summaries to gain an overview of resource utilization and configuration.
• Explore rightsizing opportunities to optimize Azure resources for performance and cost efficiency.
• Discover opportunities to reduce the carbon footprint of Azure resources and support sustainability goals.
• Identify modernization opportunities to ensure Azure resources remain up to date with best practices.
• Analyze and troubleshoot unexpected cost spikes to understand and address anomalous spending.
• Review the impact of moving a resource to a different data center for performance, latency, or cost considerations.
• Estimate potential cost savings by applying Azure Hybrid benefit to eligible resources.
• Evaluate the impact of processor choices (AMD vs Intel) on resource performance and cost.
• Assess OS change risks and implications for Azure resources before implementing updates.