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Azure Arc Licensing Benefits: Windows and SQL Server Licensing - Part 3 of 5

Azure Arc, windows and sql licensing

Welcome back to our comprehensive series on Azure Arc! In Part 1, we introduced you to Azure Arc’s transformative capabilities, and in Part 2, we explored deployment strategies to integrate your infrastructure seamlessly. Today, in Part 3, we’ll dive into how Azure Arc can optimize your Windows and SQL Server licensing costs through Pay-As-You-Go (PAYG) and Azure Hybrid Benefit, especially beneficial for those with Software Assurance.

Let’s uncover how Azure Arc not only unifies your hybrid environment but also enhances your licensing strategy to drive significant cost savings.

Understanding the Licensing Landscape

Managing licenses for Windows Server and SQL Server across on-premises, cloud, and edge environments can be complex and costly. Traditional licensing models often don’t provide the flexibility needed for dynamic, modern workloads. organisations face challenges like:

  • Underutilized Licenses: Paying for licenses that aren’t fully utilized due to fluctuating workloads.
  • Compliance Management: Ensuring all deployments meet licensing agreements to avoid penalties.
  • Budget Constraints: High upfront costs for acquiring licenses hindering scalability.

Azure Arc addresses these challenges by providing flexible licensing options that align with your hybrid strategy.

Azure Hybrid Benefit with Azure Arc

What is Azure Hybrid Benefit?

Azure Hybrid Benefit is a licensing offer that helps you significantly reduce the costs of running workloads in the cloud. It allows you to use your existing on-premises licenses with Software Assurance to pay a reduced rate when migrating or extending to Azure services.

Key Advantages

  • Cost Savings: Save up to 85% compared to pay-as-you-go rates for Windows Server and SQL Server.
  • License Mobility: Use licenses both on-premises and in Azure, perfect for hybrid deployments.
  • Investment Maximization: Leverage existing investments in Windows and SQL Server licenses.

Leveraging Azure Hybrid Benefit with Azure Arc-enabled Servers

Azure Arc extends the Azure Hybrid Benefit to your on-premises and multi-cloud servers. Here’s how:

  1. Connect Your Servers to Azure Arc: Onboard your Windows Servers and SQL Servers to Azure Arc for unified management.
  2. Apply Azure Hybrid Benefit:
    • In the Azure Portal, navigate to your Arc-enabled server.
    • Under Settings, select Configuration.
    • Enable Azure Hybrid Benefit by confirming you have active Software Assurance.
  3. Monitor Compliance and Usage:
    • Use Azure Policy and compliance tools to ensure you meet licensing requirements.
    • Regularly review your usage to optimize license allocation.

Benefits:

  • Unified Billing: Consolidate your licensing costs through Azure.
  • Flexibility: Easily move licenses between on-premises and cloud environments as your needs change.
  • Simplified Compliance: Azure tracks license usage, simplifying audits and reporting.

Pay-As-You-Go Licensing with Azure Arc

Understanding Pay-As-You-Go (PAYG) Licensing

PAYG licensing allows you to pay for Windows Server and SQL Server licenses on an hourly or monthly basis through your Azure subscription. This model is ideal for:

  • Variable Workloads: Environments where workloads scale up or down frequently.
  • Short-Term Projects: Temporary deployments where purchasing perpetual licenses isn’t cost-effective.
  • Budget-Friendly Options: Avoiding large upfront investments and paying only for what you use.

Implementing PAYG Licensing on Azure Arc-enabled Servers

For Windows Server:

  • Automatic Detection: When you connect a Windows Server to Azure Arc, Azure can detect it doesn’t have an activated license.
  • Enable PAYG:
    • In the Azure Portal, go to your Arc-enabled Windows Server.
    • Under Settings, select Extensions + applications.
    • Install the Windows Server PAYG Extension.
  • Billing: Azure begins billing for the Windows Server license as part of your subscription.

For SQL Server:

  • SQL Server Extension: Install the Azure Arc-enabled SQL Server extension on your server.

  • Enable PAYG Licensing:

    • During configuration, opt into Pay-As-You-Go licensing.
    • This activates the SQL Server licensing meter in Azure.

  • Cost Management: Monitor costs in the Cost Management + Billing section in Azure.

Advantages:

  • Scalable Costs: Align licensing costs directly with usage.
  • No Software Assurance Required: PAYG licensing doesn’t require existing licenses or Software Assurance.
  • Up-to-Date Software: Access to the latest features and security updates.

Maximizing Software Assurance with Azure Arc

Software Assurance provides benefits like license mobility, version upgrades, and support. With Azure Arc:

  • Extended License Mobility: Use your Software Assurance to cover workloads on-premises and across clouds.
  • Unified Updates: Streamline updates and patches through Azure Update Management.
  • Enhanced Support: Benefit from Azure’s support ecosystem for hybrid scenarios.

Practical Steps:

  1. Assess Your Current Licenses: Identify licenses with active Software Assurance.
  2. Plan Your Hybrid Deployment: Decide which workloads to extend to Azure using Azure Arc.
  3. Apply Azure Hybrid Benefit: Enable the benefit on your Arc-enabled servers to start saving.

Real-World Example

Scenario: Financial Services Firm Optimizes Licensing Costs

A financial services company operates critical applications on SQL Server across its on-premises datacenters and in the cloud. They faced high licensing costs and complex compliance requirements.

Solution with Azure Arc:

  • Enabled Azure Hybrid Benefit: Leveraged existing SQL Server licenses with Software Assurance across all environments.
  • Implemented PAYG Licensing: Used PAYG for additional temporary servers during peak processing times, avoiding unnecessary license purchases.
  • Centralized Management: Monitored all server licenses and compliance through the Azure Portal.

Results:

  • Cost Reduction: Achieved up to 50% savings on licensing costs.
  • Simplified Compliance: Streamlined audit preparations with unified reporting.
  • Operational Flexibility: Scaled workloads efficiently without licensing delays.

Conclusion

Azure Arc empowers organisations to optimize licensing costs and simplify management for Windows Server and SQL Server across hybrid environments. By harnessing Azure Hybrid Benefit and PAYG licensing, you can:

  • Significantly Reduce Costs: Utilize existing investments and pay only for what you need.
  • Enhance Flexibility: Adapt quickly to changing workload demands.
  • Simplify Compliance Management: Use Azure’s tools to maintain compliance effortlessly.

Incorporating these licensing strategies with Azure Arc not only maximizes the value of your existing licenses but also aligns your IT spending with actual usage, driving efficiency and fiscal responsibility.

Learn More

Deepen your understanding with these Microsoft Learn resources: