Azure VMware Solution: Clarification on Licensing Model and Billing Records — License-Included PayGo Transition

Question

Azure VMware Solution: Clarification on Licensing Model and Billing Records — License-Included PayGo Transition

Amir DIMRRY (MatchPoint IT LTD) 20 Microsoft External Staff

Problem description

I am seeking clarification on the current licensing and billing status of my Azure VMware Solution private cloud. Specifically, I want to confirm whether it is operating under License-Included PayGo, Reserved Instances, or another entitlement, and understand why there are no visible consumption or billing records in the Cost Management + Billing portal for this resource.

Environment

Azure VMware Solution private cloud in the region not specified; cluster size: three hosts (AV36); Portable VCF (BYOL) configuration: Not configured.

What I've already tried

I reviewed the Azure portal's private cloud blades, checked the Portable VCF page which shows 'Not configured,' inspected the Overview/Properties for licensing or billing metadata with no findings, examined Cost Management + Billing for any consumption records related to this cloud, and engaged support support. Additionally, I used Azure CLI commands to show the private cloud's SKU name, which is 'av36', and checked the billing records, which do not show any consumption for this resource.

Current status

I am looking for guidance on whether any action is required from my side regarding the upcoming SKU retirement, and how to determine the current licensing model and billing status of my private cloud.

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1 answer

Your answer

Answer 1

Hello @Amir DIMRRY (MatchPoint IT LTD)

The av36 SKU alone isn't enough to determine whether your three hosts are currently using license-included PayGo, a license-included Reserved Instance, or Portable VCF (BYOL). The key details are when you deployed the hosts and whether an AVS reservation currently covers them.

Microsoft's current licensing guidance states that new Azure VMware Solution deployments since November 1, 2025 must use Portable VCF purchased from Broadcom. However, existing license-included deployments have transition periods. In particular, license-included PayGo deployments must transition to Portable VCF by October 31, 2026, while hosts covered by an active license-included Reserved Instance can remain covered until the applicable RI transition deadline/expiration.

Since your Portable VCF (BYOL) page shows Not configured, first verify the billing arrangement before configuring a VCF key.

Check the Azure portal > Reservations and determine whether an Azure VMware Solution reservation exists for the subscription/billing scope and whether its quantity covers all three AV36 hosts. Reservation scope matters because the reservation can be scoped to a resource group, subscription, management group, or shared billing scope.
Confirm the original deployment/addition dates of the three hosts. This is particularly important for determining whether the environment qualifies as an existing license-included deployment.
In Cost Management + Billing > Cost analysis, expand the scope beyond the AVS resource and check the billing subscription/account that contains the reservation. With reservations, matching usage can have an effective price of zero, so looking only for charges against the private-cloud resource can be misleading.
If there is no applicable AVS reservation and these are legacy license-included PayGo hosts, plan the Portable VCF transition before October 31, 2026. Portable VCF is registered per private cloud under Manage > Portable VCF (BYOL). Once you register the Broadcom entitlement details, switch existing applicable hosts to Portable VCF pricing.

Do not configure Portable VCF simply because the portal says “Not configured.” First establish whether the three hosts are currently covered by a license-included RI or legacy PayGo entitlement. Existing VCF-included hosts can remain covered under qualifying license-included reservations or legacy PayGo conditions during the transition period.

The absence of visible consumption records is therefore worth investigating separately with the billing scope/RI information. If Cost Management still shows no AVS usage or reservation application at the billing-account level, I'd ask Microsoft Support to confirm the private cloud's backend billing meter/SKU, entitlement type, host deployment dates, and reservation benefit assignment rather than making a licensing change based solely on the portal blades.

Sharing these references with you:

Portable VCF licensing reference for Azure VMware Solution

Configure Portable VCF for Azure VMware Solution

Azure VMware Solution license-included service retirement

Azure VMware Solution Reserved Instances

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Amir DIMRRY (MatchPoint IT LTD) 20 Reputation points Microsoft External Staff

2026-09-06T07:05:55.36+00:00

Thanks for the detailed explanation.

I checked the items you suggested and here is what I found:

Reservations

I checked the Azure Reservations blade for the relevant scope and there are currently no reservations displayed at all. I could not find any Azure VMware Solution reservation associated with this subscription/scope.

AVS deployment date

The private cloud MDILabsAVS was created on August 13, 2025.

Cost Management

In Cost Analysis I can see charges for several related Azure resources (Bastion, Virtual Network Gateway, NAT Gateway, Public IPs, VM, VMSS, etc.).

However, I do not see any cost or consumption records associated with the AVS private cloud itself.

Previously, I also queried the Consumption API and was unable to find any usage records for the AVS private cloud resource.

Based on the information above:

No AVS reservation is visible.

Portable VCF currently shows "Not configured".

The private cloud was created before November 1, 2025.

I am still unable to determine whether the environment is License-Included PayGo, License-Included RI, or another entitlement type.

Given these findings, would you recommend opening a Microsoft Support case to confirm the backend billing meter/SKU and entitlement type, or is there another place you would suggest checking first?

Thanks again for your help.
Allan Solomon Mejia 7,915 Reputation points

2026-09-06T15:41:01.92+00:00

Thanks for checking those details. Based on what you've found, I think you've reached the point where opening a Microsoft Support case is appropriate.

The August 13, 2025 deployment date is significant. Microsoft's current AVS licensing guidance states that existing license-included hosts can remain covered under the legacy model, including qualifying PayGo nodes deployed before the licensing transition cutoff. Microsoft also states that license-included PayGo SKUs must transition to Portable VCF (BYOL) by October 31, 2026.

Therefore, Portable VCF (BYOL) = Not configured does not, by itself, prove that these hosts are currently unlicensed. Portable VCF is registered separately when the private cloud is using a Broadcom VCF entitlement.

At this point, open an Azure technical support request for Azure VMware Solution and ask Microsoft to confirm the private cloud's backend billing meter/SKU and current VCF entitlement model.

Include the private cloud resource ID, subscription ID, deployment date, host type/count (three AV36 hosts), screenshots showing Portable VCF (BYOL): Not configured, confirmation that no applicable AVS reservation is visible, and the Cost Management/Consumption API findings.

Don't configure Portable VCF or make licensing changes simply to test this. Configuring Portable VCF changes the private cloud to the BYOL pricing model, so it is better to have Microsoft establish the existing entitlement first.

Help make this community better for everyone: if this answer assisted you/resolved your issue, please accept it or upvote it. If not, share more details in a comment so we can continue the discussion and find the right solution.