SQL Server: What exactly is for fee and when I must to pay?

Hi Takeshi Tokugawa,

Sql Server licensing depends on the edition used, not on how it is deployed. Below are the details:

• Sql Server Express: Free and allowed for production/commercial use but limited to 10 GB database size and limited CPU/memory.
• Sql Server Developer: Free but only for development and testing but not allowed for production.
• Sql Server Standard or Enterprise: Paid license is required for production use.

For more details, please refer to the following documentation:

https://learn.microsoft.com/en-us/sql/sql-server/editions-and-components-of-sql-server-2022?view=sql-server-ver17

Thanks and regards,
Anjan Kumar Chippa

For Microsoft SQL Server there are free scenarios and paid scenarios, depending on edition, environment, and licensing model.

1. Free usage scenarios

For small apps, development, and testing, SQL Server can be used without paying for a SQL Server license in these cases:

1. SQL Server Developer edition (non‑production only)
   • Intended for: development, testing, proof of concept.
   • Feature set: same as Enterprise edition.
   • Cost: SQL Server license is free; only the underlying VM/host costs are paid.
   • Restriction: cannot be used in production.
   On Azure VMs, Developer edition is explicitly described as freely licensed:
   • “If you want to develop, test, or build a proof of concept, then use the freely licensed SQL Server Developer edition… A SQL Server Developer edition VM only incurs charges for the cost of the VM, because there are no associated SQL Server licensing costs.”
2. SQL Server Express edition (lightweight production allowed)
   • Intended for: lightweight production workloads.
   • Limits (typical): <4 cores, <1 GB memory, <10 GB per database.
   • Cost: SQL Server license is free; only pay for the OS/VM/host.
   • Production use is allowed as long as the workload fits within the technical limits.
   From the guidance:
   • “If you want to run a lightweight workload in production (<4 cores, <1-GB memory, <10 GB/database), use the freely licensed SQL Server Express edition. A SQL Server Express edition VM also only incurs charges for the cost of the VM.”
3. Free passive DR/standby replica (with conditions) If there is a paid, licensed primary SQL Server instance covered by Software Assurance, one passive secondary can be free for disaster recovery, including on Azure VMs, if all of the following are true:
   • License mobility through Software Assurance is in place.
   • The passive instance does not serve data to clients or run active workloads; it only synchronizes and stays warm standby. Allowed activities: CheckDB, full/log backups, resource monitoring, and brief DR tests every 90 days.
   • The active license with Software Assurance allows one passive secondary with up to the same compute as the primary.
   • In Azure, the secondary VM is marked as using the Disaster Recovery license.
   If the secondary serves reports or any client workload, it must be fully licensed.
4. Stopped instances / VMs in some pay‑as‑you‑go models For SQL Server enabled by Azure Arc with pay‑as‑you‑go billing:
   • “Do I get charged if my virtual machine is stopped? No. When the VM is stopped, the usage data isn't collected. Therefore, you'll not be charged for the time the VM was stopped.”
   • “Do I get charged if my SQL Server instance is stopped? No. The usage data collection requires an active SQL Server instance. Therefore, you'll not be charged for the time the SQL Server instance was stopped.”
   Billing is hourly; if the instance runs for part of an hour, that hour is billed.

2. Paid usage scenarios

Payment is required when using paid editions or paid licensing models in production or beyond the free limits.

1. Paid editions in production (Standard, Enterprise, Web) For non‑lightweight production workloads, use:
   • Web: small websites.
   • Standard: small to medium workloads.
   • Enterprise: large or mission‑critical workloads.
   These editions are not free. Licensing options include:
   • Pay per usage (pay‑as‑you‑go): typically in cloud environments (Azure VMs, Azure Arc pay‑as‑you‑go). The per‑second or per‑hour cost includes the SQL Server license and depends on vCPUs.
     • “Paying the SQL Server license per usage (also known as pay as you go) means that the per-second cost of running the Azure VM includes the cost of the SQL Server license… The per-second licensing cost depends on the number of VM vCPUs.”
   • Bring your own license (BYOL): use existing SQL Server licenses (per‑core or Server+CAL) with or without Software Assurance, subject to the licensing terms.
   For SQL Server enabled by Azure Arc, the table shows that for production you can:
   • Subscribe via pay‑as‑you‑go.
   • Bring your own license with Software Assurance or subscription.
   • Bring your own license without Software Assurance (with some limitations, e.g., no unlimited virtualization).
2. Pay‑as‑you‑go via Azure Arc (on‑premises / VPS) If SQL Server instances (including those in Docker on a VPS) are connected to Azure Arc and configured for pay‑as‑you‑go:
   • Charges apply hourly for cores in use.
   • “For organizations that prefer a consumption model, Arc offers pay-as-you-go licensing for SQL Server 2012 and later. You pay hourly for the cores in use, letting you save costs by avoiding full licensing charges.”
   • Intermittent connectivity does not stop billing; usage is reconciled when connectivity resumes.
3. Minimum core licensing Pay‑as‑you‑go does not change base licensing terms:
   • “Pay-as-you-go billing doesn't change the licensing terms of SQL Server. Therefore, it's subject to the four-core limit as defined in the SQL Server licensing terms.”

3. Applying this to Docker on a VPS

Running SQL Server in Docker on an Ubuntu VPS falls under SQL Server as downloadable software, not a managed cloud database. Licensing is about:

• Which edition is used (Developer, Express, Standard, Enterprise, Web).
• Which licensing model is chosen (free edition, BYOL, or Arc pay‑as‑you‑go).

In general:

• If using Developer edition in Docker for development/testing only → no SQL Server license cost.
• If using Express edition in Docker and the workload stays within Express limits → no SQL Server license cost, even in production.
• If using Standard/Enterprise/Web in Docker in production → must either:
  • Have valid SQL Server licenses (per‑core or Server+CAL) that cover the cores used, or
  • Enable Azure Arc pay‑as‑you‑go and pay hourly for cores.

The VPS cost itself is separate from SQL Server licensing.

4. Summary

Pay is required when:

• Using Standard/Enterprise/Web editions in production (on‑prem, VPS, or cloud), unless covered by free rights (e.g., passive DR under Software Assurance) or free editions.
• Using pay‑as‑you‑go licensing (Azure VMs or Azure Arc) while the SQL Server instance is running.

Free usage is allowed when:

• Using Developer edition strictly for non‑production.
• Using Express edition within its resource limits, including in production.
• Using one passive DR replica that meets the Software Assurance and passive‑only conditions.

References:

• Frequently asked questions for SQL Server on Azure VMs
• Frequently asked questions - SQL Server enabled by Azure Arc
• Pricing guidance for SQL Server on Azure VMs
• Manage licensing and billing of SQL Server enabled by Azure Arc
• Cloud-native licensing and cost management with Arc-enabled servers