Direct answer: at the Azure Retail Prices API on 9 November 2026 (eastus, USD, excluding tax/discounts), Azure SQL Managed Instance General Purpose (GP) compute is $0.152218/vCore-hour ≈ $111.12/vCore-month and Business Critical (BC) is $0.304435/vCore-hour ≈ $222.24/vCore-month. For 8 vCore + 1 TB: GP is about $1,003.03/month (compute $888.95 + storage $114.08) and BC about $2,025.90/month (compute $1,777.90 + storage $248.00). A one-year reservation cuts 8-vCore compute to GP $578/month and BC $1,155.33/month; a three-year reservation cuts it to GP $400/month and BC $800/month, for totals of about $514.08 and $1,048.00/month (48.7% / 48.3% below PAYG total). The first 32 GB/month of storage is free; beyond that GP is $0.115/GB-month and BC $0.25. Zone redundancy adds 60% to compute and storage becomes GP $0.23 / BC $0.50. PITR backup is $0.10 (LRS/ZRS) or $0.20 (RA) per GB-month; long-term retention is $0.025/$0.05. A stopped instance bills storage only; SQL Server licences with Software Assurance can use Azure Hybrid Benefit; new customers get 720 vCore-hours for 12 months.
This guide is for database leads, platform/SRE, finance and procurement teams migrating SQL Server to Azure or choosing between GP/BC, reservations, SQL Database and SQL Server on a VM. It explains vCore/storage/backup billing, 4/8/16-vCore TCO, one- and three-year reservations, zone redundancy, stop/start, AHB, the SQL DB/VM boundary and a 90-day checklist. Prices come from the Azure SQL Managed Instance pricing page, the Azure Retail Prices API and Microsoft Learn (eastus, 9 November 2026). Official price facts, editorial calculations and exclusions are kept separate. This is not procurement advice.
(1) BC compute is 2× GP and storage about 2.17×; pay for BC only when you need low-latency local SSD, a free readable replica or higher IOPS. (2) Reservations discount compute: about 35% for one year and 55% for three years, but storage is not discounted, so total savings are lower. (3) 32 GB of storage and PITR backup equal to database size are included; zone redundancy adds 60% compute, and stopping an instance stops compute, not storage.
GP vs BC: 2× compute, 2.17× storage
MI has two main service tiers: General Purpose for typical performance and I/O latency using remote premium storage, and Business Critical for low I/O latency, fast failover and read scale-out using local SSD, with one free readable replica. BC's vCore price is exactly 2× GP, and its storage price is 2.17× GP. As a result, "BC 4 vCore" costs about the same in compute as "GP 8 vCore"; confirm that the latency and read replica are truly required before choosing BC.
| Item | General Purpose | Business Critical | Basis |
|---|---|---|---|
| vCore price | $0.152218/hour | $0.304435/hour | Gen5; 730 hours/month |
| vCore monthly | 111.12 | 222.24 | 0.152218/0.304435 × 730 |
| Storage | $0.115/GB-month | $0.25/GB-month | First 32 GB/month free |
| Zone redundancy compute | +$0.091331/vCore-hour | +$0.182661/vCore-hour | 60% of base |
| Zone redundancy storage | $0.23/GB-month | $0.50/GB-month | 2× base |
| PITR backup (LRS/ZRS) | $0.10/GB-month | $0.10/GB-month | Above database size |
| PITR backup (RA-GRS/RA-GZRS) | $0.20/GB-month | $0.20/GB-month | Read-access geo-redundant |
| Long-term retention (LRS/ZRS) | $0.025/GB-month | $0.025/GB-month | LTR |
| Long-term retention (RA) | $0.05/GB-month | $0.05/GB-month | RA-GRS/RA-GZRS |
| Additional IOPS | $0.038/IOPS-month | Local SSD per vCore | GP next-gen 300 free IOPS/server |
| Additional memory | $0.010603/GB-hour | — | About $7.74/GB-month |
Sources: Azure Retail Prices API (eastus, 9 November 2026) and the Azure SQL Managed Instance pricing page. BC storage $0.25, GP $0.115; zone redundancy is a separate meter in the API. Excludes tax and CSP/enterprise discounts.
4/8/16-vCore TCO: 500 GB / 1 TB / 2 TB
At 730 hours, first 32 GB free, excluding ZR/backup/IOPS: GP 4 vCore + 500 GB ≈ $498.30/month; GP 8 + 1 TB ≈ $1,003.03; GP 16 + 2 TB ≈ $2,009.75. BC 4 + 500 GB ≈ $1,005.95 (same compute as GP 8); BC 8 + 1 TB ≈ $2,025.90; BC 16 + 2 TB ≈ $4,059.80. For a regular business database without low-latency or read-replica needs, GP is usually the cheaper starting point.
| Configuration | Compute/month | Storage/month | Total/month |
|---|---|---|---|
| GP 4 vCore + 500 GB | 444.48 | 53.82 | 498.30 |
| GP 8 vCore + 1 TB | 888.95 | 114.08 | 1,003.03 |
| GP 16 vCore + 2 TB | 1,777.91 | 231.84 | 2,009.75 |
| BC 4 vCore + 500 GB | 888.95 | 117.00 | 1,005.95 |
| BC 8 vCore + 1 TB | 1,777.90 | 248.00 | 2,025.90 |
| BC 16 vCore + 2 TB | 3,555.80 | 504.00 | 4,059.80 |
Editorial calculation: 730 hours/month; GP $0.152218/vCore-hour, BC $0.304435; storage GP $0.115, BC $0.25, after 32 GB free; excludes ZR, PITR/LTR, extra IOPS/memory, DR replica, tax and discounts.
Reservations: 35% off one year, 55% off three years (compute only)
MI reservations are bought per vCore: one year GP $867/vCore, BC $1,733/vCore; three years GP $1,800/vCore, BC $3,600/vCore. Against PAYG annual compute (GP $1,333.43, BC $2,666.85/vCore), that is about 35% off for one year and 55% off for three years. Storage is not covered, so the total saving on 8 vCore + 1 TB is 31.0% (one year) and 48.7% (three years), not 35%/55%. Reservations suit a stable baseline; if the instance may shrink, migrate or stop, model the commitment period first.
| Purchase (8 vCore + 1 TB) | Compute/month | Storage/month | Total/month | vs PAYG |
|---|---|---|---|---|
| GP PAYG | 888.95 | 114.08 | 1,003.03 | — |
| GP 1-year reservation | 578.00 | 114.08 | 692.08 | 310.95 (31.0%) |
| GP 3-year reservation | 400.00 | 114.08 | 514.08 | 488.95 (48.7%) |
| BC PAYG | 1,777.90 | 248.00 | 2,025.90 | — |
| BC 1-year reservation | 1,155.33 | 248.00 | 1,403.33 | 622.57 (30.7%) |
| BC 3-year reservation | 800.00 | 248.00 | 1,048.00 | 977.90 (48.3%) |
Sources: 1/3-year Reservation meters in the Azure Retail Prices API (eastus, 9 November 2026); monthly compute = per-vCore reservation price × 8 ÷ 12 or ÷ 36; storage at PAYG. Reservations do not cover storage/backup; actual scope, region and exchange rules follow the Azure Reservations page.
32 GB free, backup, ZR and additional IOPS
Each instance gets the first 32 GB/month of storage free; beyond that GP is $0.115 and BC $0.25/GB-month. PITR defaults to 7 days and can reach 35 days; backup storage equal to the database size is free, with the excess at $0.10 (LRS/ZRS) or $0.20 (RA) per GB-month; LTR is $0.025/$0.05. Zone redundancy adds 60% to compute and doubles storage (GP $0.23, BC $0.50). GP next-gen includes 300 free IOPS per server, with additional IOPS at $0.038/IOPS-month (ZR $0.076); additional memory is $0.010603/GB-hour (about $7.74/GB-month). These are outside the main TCO but appear on the bill.
| Add-on | Price/rule | When it occurs |
|---|---|---|
| Storage | GP $0.115, BC $0.25/GB-month | Above 32 GB/month |
| Zone redundancy | Compute +60%; storage $0.23/$0.50 | ZR enabled |
| PITR backup | $0.10 (LRS/ZRS), $0.20 (RA)/GB-month | Above DB size; 7–35 days |
| Long-term retention | $0.025 (LRS/ZRS), $0.05 (RA)/GB-month | LTR configured |
| Additional IOPS | $0.038/IOPS-month (ZR $0.076) | GP next-gen above 300 IOPS/server |
| Additional memory | $0.010603/GB-hour | GP flexible/additional memory |
| DR replica | Instance compute/storage; licence can be saved | Failover group/read replica |
| Stopped instance | Storage only | Compute not billed while stopped |
Sources: Azure SQL Managed Instance pricing page, Azure Retail Prices API and Learn "Azure SQL Managed Instance overview" (9 November 2026). The "free DR replica" refers to licence-cost savings; compute/storage still bill for the deployed instance.
Stop/start, AHB and the free DR replica
Three overlooked cost levers: stop/start — Microsoft states that a stopped instance bills storage only and can be restarted at any time, which suits dev/test and intermittent workloads; Azure Hybrid Benefit — SQL Server licences with Software Assurance reduce compute, with the exact discount depending on licence and region (not quantified here); free DR replica — a secondary replica can be designated for disaster recovery only to save licence cost, while compute/storage still bill. New customers also get 720 vCore-hours for 12 months on GP, useful for validation before migration.
| Lever | Saving | Watch out |
|---|---|---|
| Stop/start | Compute stops; storage only | Restart takes time; not for continuous production |
| 3-year reservation | About 55% of compute | Total saves 48.3%–48.7% (storage not discounted) |
| 1-year reservation | About 35% of compute | Total saves 30.7%–31.0% |
| BC → GP | Compute halves | Only if low latency/read replica is not required |
| Azure Hybrid Benefit | Lower compute | Requires SA; check licence/region |
| Storage/backup cleanup | $0.025–$0.25/GB-month | 32 GB free; DB-size backup free |
| ZR on demand | Saves 60% compute | Enable only for critical workloads |
| 720 vCore-hours | Free for 12 months | New customers/GP only |
Editorial summary; sources: Learn "Azure SQL Managed Instance overview", pricing page and Retail API (9 November 2026). AHB and free DR replica applicability follow the licence agreement and official docs.
MI vs SQL Database vs SQL Server on a VM
The choice is not "which is cheapest" but "how much SQL Server instance capability do you need". MI suits lift-and-shift of a whole instance: cross-database queries/transactions, SQL Agent, CLR, linked servers, VNet isolation and near-100% SQL Server compatibility. SQL Database suits single databases/elastic pools, Serverless/Hyperscale and finer per-database elasticity. SQL Server on a VM suits OS-level control, third-party agents or features MI does not support. Within MI: GP for typical 5–10 ms latency and cost sensitivity; BC for low-latency local SSD, a free readable replica and higher IOPS.
| Scenario | Prefer | Check first |
|---|---|---|
| Whole-instance migration, cross-DB/SQL Agent/CLR | SQL Managed Instance | VNet, compatibility, migration tooling |
| Single DB/elastic pool, Serverless | SQL Database | Per-DB elasticity, Hyperscale |
| OS-level control/third-party agents | SQL Server on VM | Patching, HA, licensing |
| Low-latency local SSD, read replica, high IOPS | BC | 2× GP compute, $0.25 storage |
| Regular business, cost-sensitive | GP | Remote storage, no read scale-out |
| DR/failover | Failover group/DR replica | Compute/storage billed separately |
| Dev/test/intermittent | GP + stop/start | Restart time, storage keeps billing |
Editorial selection framework, not a vendor recommendation; features/compliance/regional availability follow official docs and business requirements.
90-day optimization checklist
Use 90 days to move through "inventory → tier → storage/backup → reservation → review". Weeks 1–2: pull vCore, storage, PITR/LTR, IOPS, ZR, DR replica and actual CPU/IO baselines. Weeks 2–4: confirm whether BC's local SSD/read replica is truly required; use GP where possible. Weeks 4–6: right-size storage, reduce PITR from 35 days to the required window and clean unused LTR. Weeks 6–8: enable stop/start for non-production instances and validate restart time. Weeks 8–10: evaluate one- or three-year reservations and AHB on a stable baseline, remembering storage is not discounted. Weeks 10–12: review DR replicas, ZR, extra IOPS/memory and post-migration bill differences.
FAQ
How is Azure SQL Managed Instance billed?
By vCore-hour + storage + backup: GP $0.152218/vCore-hour ($111.12/vCore-month), BC $0.304435 ($222.24); the first 32 GB/month of storage is free, then GP $0.115 and BC $0.25/GB-month; PITR backup $0.10/$0.20 and LTR $0.025/$0.05 per GB-month. ZR, extra IOPS/memory and DR replicas are extra.
How much more does BC cost than GP?
BC's vCore price is 2× GP and storage about 2.17×, so BC 4 vCore costs about the same in compute as GP 8 vCore. BC buys low-latency local SSD, an extra built-in read-only replica and higher IOPS; if those are not required, GP is cheaper.
How much do reservations save?
About 35% of compute for one year and 55% for three years. On 8 vCore + 1 TB: GP one year $692.08 (31.0% off total), three years $514.08 (48.7%); BC one year $1,403.33 (30.7%), three years $1,048.00 (48.3%). Storage is not reserved, so total discounts are lower than compute discounts.
How do the 32 GB free storage and backup work?
Each instance gets the first 32 GB/month free. PITR defaults to 7 days and can reach 35; backup storage equal to the database size is free, with the excess at $0.10 (LRS/ZRS) or $0.20 (RA) per GB-month; LTR is $0.025/$0.05. Backup cost depends on database size, change rate and retention.
How much does zone redundancy add?
Compute +60% (GP +$0.091331/vCore-hour, BC +$0.182661); storage roughly doubles (GP $0.23, BC $0.50/GB-month). For 8 vCore + 1 TB: GP ZR about $1,650.49/month, BC ZR about $3,340.64/month.
Does stopping an instance save money?
Yes. Microsoft states a stopped instance bills storage only and can be restarted at any time; it suits dev/test and intermittent workloads. Do not rely on stop/start for continuous production: restart takes time and storage keeps billing.
How does Azure Hybrid Benefit work?
SQL Server licences with Software Assurance can be assigned to MI to reduce compute; the exact discount depends on licence type, region and agreement. Confirm AHB coverage in the Azure portal/Cost Management, then compare "PAYG vs AHB vs reservation" combinations.
How do MI, SQL Database and SQL Server on a VM compare?
Choose MI for whole-instance migration, cross-database queries, SQL Agent, CLR, linked servers and VNet isolation; SQL DB for single databases/elastic pools, Serverless/Hyperscale; SQL Server on a VM for OS-level control, third-party agents or unsupported features. Then use GP/BC and reservations to hit the cost target.
Research method and limitations
This article separates "official price facts" from "editorial calculations": GP $0.152218/vCore-hour, BC $0.304435, GP/BC storage $0.115/$0.25, ZR $0.091331/$0.182661 and $0.23/$0.50, PITR $0.10/$0.20, LTR $0.025/$0.05, GP additional IOPS $0.038, additional memory $0.010603/GB-hour, and one-/three-year reservations $867/$1,800 (GP) and $1,733/$3,600 (BC) come from the Azure Retail Prices API (eastus, 9 November 2026); the 32 GB free storage, 7–35-day PITR, backup equal to database size free, BC local SSD/free readable replica, stop/start storage-only billing, AHB, the 720 vCore-hour allowance and GP/BC positioning come from the Azure SQL Managed Instance pricing page and Microsoft Learn (overview, resource limits, vCore service tiers).
Eight limitations: (1) only eastus list prices, excluding tax/CSP/enterprise discounts; (2) 730-hour months, without modelling every month length; (3) the main TCO excludes ZR, PITR/LTR, extra IOPS/memory, DR replicas and networking; (4) reservations are converted linearly per vCore; actual scope/exchange rules follow Azure Reservations; (5) AHB discounts are not quantified; (6) classic GP and next-gen GP storage/IOPS differences are not fully separated; (7) no real CPU/IO/latency benchmark, so the need for BC must be validated with performance data; (8) prices, regional availability and features change, so recheck official pages and bills before purchase.
Sources and basis
- Microsoft Azure, Azure SQL Managed Instance Pricing: azure.microsoft.com/en-us/pricing/details/azure-sql-managed-instance/single. GP/BC vCore, 32 GB free storage, ZR, PITR/LTR, extra IOPS, AHB, reservations. Accessed 9 November 2026.
- Azure Retail Prices API (productName contains SQL Managed Instance, eastus): prices.azure.com/api/retail/prices. $0.152218/$0.304435, $0.115/$0.25, $0.091331/$0.182661, $0.23/$0.50, $0.10/$0.20, $0.025/$0.05, $0.038, $0.010603, $867/$1,800, $1,733/$3,600. Accessed 9 November 2026.
- Microsoft Learn, Azure SQL Managed Instance overview: learn.microsoft.com/en-us/azure/azure-sql/managed-instance/sql-managed-instance-paas-overview. GP/BC positioning, stop/start storage-only billing, free DR replica, AHB, 720 vCore-hour allowance. Accessed 9 November 2026.
- Microsoft Learn, Azure SQL Managed Instance resource limits: learn.microsoft.com/en-us/azure/azure-sql/managed-instance/resource-limits. vCore ranges, maximum storage, tempdb, premium-series/memory-optimized. Accessed 9 November 2026.
- Microsoft Learn, vCore purchasing model (GP/BC service tiers): learn.microsoft.com/en-us/azure/azure-sql/database/service-tiers-vcore. GP/BC HA replicas, free readable replica, local SSD/remote storage and IOPS differences. Accessed 9 November 2026.
Data cut-off 9 November 2026; prices/availability follow Microsoft official pages and bills; this is not procurement, commercial or legal advice.