0Pricing
Azure Fundamentals · Lesson

Reserved Instances and Azure Hybrid Benefit

Cut compute costs by committing to one- or three-year Reserved VM Instances, and apply the Azure Hybrid Benefit to reuse existing Windows Server and SQL Server licences.

Introduction to Azure Reservations

Azure Reservations are one- or three-year commitments to specific Azure resource configurations in exchange for significant discounts compared to pay-as-you-go pricing. Reservations are paid upfront or monthly, and the discount is automatically applied to any matching resource you have running — you do not need to change anything about how you deploy the resources. Reservations are the primary cost optimisation tool for stable, predictable workloads.

Reserved Virtual Machine Instances

Reserved VM Instances (RVIs) provide up to 72% savings over pay-as-you-go VM pricing. When you purchase an RVI, you specify the VM series (e.g., D-series v5), region (e.g., East US), and OS (Windows or Linux). Azure automatically applies the reservation discount to any running VM of that specification during the reservation term. You can choose instance size flexibility to allow the discount to apply across different sizes within the same VM family.

# Purchase a 1-year Reserved VM Instance via Azure CLI
az reservations reservation-order purchase \
  --apply-scope Shared \
  --billing-scope /subscriptions/<sub-id> \
  --display-name MyVMReservation \
  --location eastus \
  --quantity 1 \
  --reserved-resource-type VirtualMachines \
  --sku Standard_D2s_v5 \
  --term P1Y \
  --billing-plan Upfront

All lessons in this course

  1. How Azure Pricing Works
  2. Azure Pricing Calculator and TCO Calculator
  3. Azure Cost Management and Budgets
  4. Reserved Instances and Azure Hybrid Benefit
← Back to Azure Fundamentals