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You will pay the Pay as you go rate for every hour the host is provisioned, and you will pay for the entire host regardless of the number of VM instances that are running on the host. Any additional charges, such as software licenses, are charged separately.

The software licenses are billed separately at individual VM level based on the usage. Eligible customers can leverage the Azure Hybrid Benefits to save on licenses.

Because the hardware is dedicated to you, the outsourcing software management terms applicable to Windows server and SQL server licenses acquired prior to October 1, 2019 permit you to allocate your existing licenses to Azure Dedicated Host just as you would license a server in your own data center. Eligible customers can also use the Azure Hybrid Benefit for savings on Azure Dedicated Host deployments. Learn more on the Azure Hybrid Benefits page.

In general, you can run different VM sizes on the same dedicated host. For example, you can deploy D2s v3 and D16s v3 VMs to the same host. However, there are some exceptions (e.g., the NVasv4_Type1 Dedicated Host SKU.) In any case, you cannot deploy VMs from different VM series (e.g. Dsv3 and Esv3). Please refer to the documentation for more details and up to date information.

The outsourcing software licensing terms applicable to Windows Server and SQL Server licenses acquired before October 1, 2019, allow you to allocate your existing licenses to Dedicated Host. If you’re eligible for Azure Hybrid Benefit, save more on Dedicated Host deployments. If you purchased new licenses after October 1, 2019, you may allocate them to Azure only via Azure Hybrid Benefit. You’ll need Software Assurance or subscriptions with equivalent rights to apply those licenses to Dedicated Host. Read the licensing FAQ for details.

Azure Hybrid Benefit applies to Windows Server Standard/Datacenter licenses and SQL Server Standard/Enterprise Core licenses with Software Assurance or subscription licenses with equivalent rights.

Yes, you'll get three years of free extended security updates for Windows Server and SQL Server 2008/2012 and 2008/2012 R2 running in Dedicated Host after the end of support.

Yes, you do. Under Azure Hybrid Benefit program, when you apply your existing Windows Server Datacenter licenses or SQL Server Enterprise edition licenses with Software Assurance to all the physical cores available to you on any given Dedicated Host server, you are granted unlimited virtualization rights. For example, if you have 32 existing Windows Server Datacenter licenses with Software Assurance on premises, you can use the same 32 licenses to install on a Dedicated Host as many Azure VMs running Windows Server as you want, subject to the physical capacity of the underlying server. You should license only the available physical cores on each Dedicated Host that you plan to provision (for example, 32 cores for a Dsv3 Type 1 Dedicated Host).

The available physical cores are calculated by dividing the available vCPUs in the host (listed on the pricing page) by the vCPU:core value for each VM series (see the Azure compute unit documentation). Most Azure VMs available on Dedicated Host offer a vCPU:core ratio equal to 2. For example, an Esv3 series Type 1 Dedicated Host has 32 available physical cores and a vCPU:core ratio equal to 2 and can host up to 64 vCPUs.

With unlimited virtualization rights you can substantially reduce your Windows Server and SQL Server licensing costs. Instead of licensing each Azure VM based on the number of vCPUs each VM has or using Azure Hybrid Benefit on each VM that you deploy on Azure Dedicated Host, you can license the entire set of available physical cores on each dedicated host. For example, if you have 32 existing Windows Server Datacenter licenses purchased before October 1, 2019, and you need to deploy 32 Dsv3 VMs each with 2 vCPUs on Azure Dedicated Host Type 1, you'd need:

• 256 Windows Server Datacenter licenses if you took advantage of Azure Hybrid Benefit while applying the benefits at the VM level.
• 40 Windows Server Datacenter licenses if you applied the outsourcing rule and licensed the entire number of physical cores that Azure Dedicated Host Type 1 has.
• Only 32 Windows Server Datacenter licenses if you use Azure Hybrid Benefit unlimited virtualization rights on the same host.

Additionally, you can use concurrently on Azure Dedicated Host and your on-premises licensed servers the same licenses for up to 180 days.

For SQL Server, you'll need the Enterprise edition and active Software Assurance or subscription licenses to be eligible for unlimited virtualization. For Windows Server, you'll need the Datacenter edition, and, if you use licenses acquired after October 1, 2019, you’ll also need active Software Assurance or subscription licenses to be eligible for unlimited virtualization on Dedicated Host.

Windows Server Datacenter licenses purchased before October 1, 2019, have unlimited virtualization rights based on license-only rights. Licenses acquired after that date have unlimited virtualization rights only by virtue of Azure Hybrid Benefit.

When allocating SQL Server or Windows Server licenses to a Dedicated Host using Azure Hybrid Benefit, you only have to license the available physical cores on the host (for example, 32 cores for an Esv3 series Type 1 Azure Dedicated Host).

When allocating Windows Server licenses purchased prior to October 1, 2019, to the host, without using Azure Hybrid Benefit, you must license all of the physical cores of the host (for example, 40 cores for an Esv3 series Type 1 Azure Dedicated Host).