Many organizations purchase Software Assurance or subscription-based Windows and SQL Server licenses that entitle them to use Azure Hybrid Benefit. However, if the setting is not applied on eligible resources, Azure continues charging pay-as-you-go rates that already include Microsoft licensing costs. This oversight results in paying twice—once for the on-premises license and once for the built-in Azure license. The inefficiency often goes unnoticed because licensing configurations are not centrally validated or enforced. Enabling AHUB can reduce costs by up to 40% for Windows server VMs and up to 30% for SQL Databases.
Azure bills Windows and SQL-based VMs either as license-inclusive (pay-as-you-go) or license-excluded (when Azure Hybrid Benefit is applied). Without AHB enabled, workloads that already own valid licenses are billed at the higher license-inclusive rate, resulting in duplicated spend.
