Azure Local pricing calculator
Work out what an Azure Local cluster (formerly Azure Stack HCI) costs per physical core, and compare the four ways to license its Windows Server VMs: the Windows Server subscription, Azure Hybrid Benefit, an OEM licence, or Datacenter licences you already own. Microsoft’s own per-core prices in pounds or dollars, with every rule sourced.
Microsoft retail prices, checked 2026-09-14. GBP figures are Microsoft’s own GBP meters. Your agreement may differ.
- Adding external SAN storage later starts a 30-day trial, then billing moves to the L2 rate automatically and Azure Hybrid Benefit no longer applies.
- Billing runs until the Azure Local resource is deleted. A cluster that is switched off but not deleted keeps billing until it has been disconnected for more than 31 days (version 2504 and later).
- Every node must connect to Azure at least every 30 days. Fully disconnected sites need disconnected operations (L3): a one-year, all-cores commitment arranged through Microsoft account teams (retail meter $1.67 per core per day), not included here.
A host fee on every core, and Windows Server on top
Azure Local has two separate charges. The host fee pays for the platform and is charged on every physical core in every node, every day the cluster is registered. Windows Server guest VMs are licensed on top of that. You can pay for them monthly through the Windows Server subscription, or cover them with licences you already have (Azure Hybrid Benefit or your own Datacenter licences), or with an OEM licence bought with the hardware. Microsoft’s pricing page lists them as separate rows, and they are easy to misread as alternative tiers.
Storage decides the rate, and whether Hybrid Benefit is allowed
Microsoft splits connected clusters into two billing tiers. L1 is hyperconverged: every node uses its own drives through Storage Spaces Direct, up to 16 nodes. L2 covers hyperconverged clusters with external SAN storage attached, disaggregated (SAN-only) designs and Azure Local multi-rack deployments. A two-rack rack aware cluster on local storage is still L1. L2 has roughly double the host fee and excludes Azure Hybrid Benefit. An L1 cluster that later gains external storage gets 30 days at its current rate, then moves to L2 on its own.
Four ways to license the Windows Server VMs
| Route | Azure charges | What you need | Catches |
|---|---|---|---|
| Windows Server subscription | Host fee + $0.775 (£0.5706) per core per day | Nothing else; no CALs | Charged on every physical core, however few VMs run Windows |
| Azure Hybrid Benefit | None: host fee and subscription waived | Datacenter with SA (EA) or CSP subscription, one core licence per physical core | L1 only; cannot be switched off; 180-day on-premises overlap |
| OEM licence | None on L1; a host fee with external storage | Bought with new catalogue nodes, every node | Windows Server Datacenter 2025 or earlier supported guests (no next-version rights); no reassignment; one node without it bills the whole cluster |
| Your own Datacenter licences | Host fee only | Datacenter core licences per node (8 per CPU, 16 per server minimums) plus CALs | New Windows Server versions need new licences or SA |
The clocks that catch people out
Three dates change a bill more than the core count does: when the free trial ends, when the Hybrid Benefit overlap runs out, and what happens after a cluster is switched off. Billing does not stop at shutdown; it stops when the Azure resource is deleted, or after more than 31 days disconnected.
Monthly Azure fees for common clusters
Computed by the calculator above in pounds, per average month (365/12 days), free trial not deducted.
| Cluster | Cores | L1 host fee | L1 + Windows Server | L2 host fee | L2 + Windows Server |
|---|---|---|---|---|---|
| 2 nodes · 1 × 16-core | 32 | £237 | £792 | £237 | £792 |
| 3 nodes · 2 × 24-core | 144 | £1,064 | £3,564 | £1,064 | £3,564 |
| 4 nodes · 2 × 32-core | 256 | £1,892 | £6,335 | £1,892 | £6,335 |
| 8 nodes · 2 × 64-core | 1024 | £7,569 | £25,341 | £7,569 | £25,341 |
Azure Local pricing FAQs
How much does Azure Local cost per core?
Azure Local charges a host fee on every physical core, billed daily. With local storage only (L1) it is $0.33 (£0.243) per core per day, about $10.04 (£7.39) a month. With external SAN storage or a disaggregated design (L2) it is $0.667 (£0.4911) per core per day, about $20.29 (£14.94) a month. The first 60 days after registration are free. These are Microsoft’s retail meters, checked 2026-09-14.
Is Windows Server included in the Azure Local host fee?
No. The host fee covers Azure Local itself. Windows Server guest VMs need their own licensing. The Windows Server subscription costs $0.775 (£0.5706) per physical core per day, on top of the host fee; Microsoft’s pricing page shows $23.25 for a 30-day month. An L1 core with the subscription therefore costs about $33.61 a month. The alternatives are Azure Hybrid Benefit, an OEM licence, or Windows Server Datacenter licences you already own.
Can I use Azure Hybrid Benefit on Azure Local?
Yes, if you have Windows Server Datacenter with active Software Assurance through an Enterprise Agreement, or a CSP subscription. You exchange one core licence for each physical core in the cluster, and Microsoft waives both the host fee and the Windows Server subscription. It works only on L1 clusters (local storage, cloud connected), cannot be switched off once activated, and gives 180 days to use the licences on-premises and on Azure Local together while you migrate. It is not available for Azure Local deployed as Microsoft 365 Local.
What is the Azure Local OEM licence?
A licence bought from the hardware vendor with new Premier Solutions, Integrated Systems or Validated Nodes. It covers Azure Local and Windows Server Datacenter 2025 (or earlier supported) guest VMs for the life of that hardware, with no renewal. Microsoft documents it for hyperconverged deployments. Every physical core on every node must be covered; it cannot move to other hardware and has no next-version rights. If any node in the cluster lacks it, the whole cluster is billed monthly. The price comes from the hardware vendor.
What does an OEM licence cost with external SAN storage?
Microsoft currently gives two answers. Its Azure Local pricing page says an OEM licence with external storage pays the L1 monthly service fee ($9.90 per core per month). Its public price list has a separate “L2 - OEM License Step-up” meter at $0.667 per core per day, the full L2 rate. The calculator uses the higher figure by default and lets you switch.
Are hyperthreads or unused cores billed?
Every physical core in each node is billed while the cluster is registered, whether or not your VMs use it. Hyperthreads (logical processors) are not counted, and there is no minimum or maximum core count.
Can I run Azure Local on existing or refurbished servers?
Yes, if the servers match a solution in Microsoft’s Azure Local catalogue. The Azure-billed and Azure Hybrid Benefit routes work on reused hardware. The OEM licence does not: it is sold only with new catalogue hardware at the point of sale.
Does billing stop when I shut an Azure Local cluster down?
Not straight away. On version 2504 and later, a cluster that is shut down or decommissioned without deleting its Azure resource keeps billing until it has been disconnected for more than 31 days. Delete the resource to stop billing. A running cluster must connect to Azure at least every 30 days.
Is Azure Local the same as Azure Stack HCI?
Yes. Microsoft renamed Azure Stack HCI to Azure Local, and some of its price-list meters still carry the Azure Stack HCI name at the same rates. The billing model above applies to current Azure Local releases.
Why do your monthly figures differ slightly from Microsoft’s pricing page?
Microsoft bills per core per day. Its pricing page multiplies by 30 days, so it shows $9.90, $20.01 and $23.25. This calculator uses the average month of 365/12 days (about 30.4), which is closer to what a year of bills adds up to. Term and annual totals always use the daily rate.
Related tools and pages
Sources
- Microsoft — Azure Local pricing (checked 14 Sep 2026)
- Azure Retail Prices API — Azure Local and Windows Server for Azure Local meters (checked 14 Sep 2026)
- Microsoft Learn — Azure Local billing and payment (updated 25 Jun 2026)
- Microsoft Learn — Azure Hybrid Benefit for Azure Local (updated 25 Jun 2026)
- Microsoft Learn — Azure Hybrid Benefit for Windows Server (Azure Local tab) (updated 3 Sep 2025)
- Microsoft Learn — OEM license and billing FAQ for Azure Local (updated 6 Apr 2026)
- Microsoft Learn — OEM license overview for Azure Local (updated 22 Apr 2026)
- Microsoft Learn — Activate Windows Server VMs on Azure Local (updated 29 Jun 2026)
- Lenovo Press LP2424 — Azure Local OEM licence ordering (CTO only) (19 Apr 2026)
- Microsoft Product Terms — Windows Server (8 per processor, 16 per server) (checked 14 Sep 2026)
Prices are Microsoft’s public retail meters and change without notice; enterprise agreements and CSP partners may price differently. The calculator excludes disconnected operations (L3, a one-year commitment bought through Microsoft account teams), Azure Virtual Desktop fees, hardware and support. OEM licence and Windows Server licence prices come from your hardware vendor or reseller.
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