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# What are Azure Reservations?
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Azure Reservations help you save money by committing to one-year or three-years plans for virtual machines, Azure Blob storage or Azure Data Lake Storage Gen2, SQL Database compute capacity, Azure Cosmos DB throughput, or other Azure resources. Committing allows you to get a discount on the resources you use. Reservations can significantly reduce your resource costs up to 72% on pay-as-you-go prices. Reservations provide a billing discount and don't affect the runtime state of your resources.
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Azure Reservations help you save money by committing to one-year or three-years plans for virtual machines, Azure Blob storage or Azure Data Lake Storage Gen2, SQL Database compute capacity, Azure Disk Storage, Azure Cosmos DB throughput, or other Azure resources. Committing allows you to get a discount on the resources you use. Reservations can significantly reduce your resource costs up to 72% on pay-as-you-go prices. Reservations provide a billing discount and don't affect the runtime state of your resources.
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You can pay for a reservation up front or monthly. The total cost of up-front and monthly reservations is the same and you don't pay any extra fees when you choose to pay monthly. Monthly payment is available for Azure reservations, not third party products.
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-**Reserved Virtual Machine Instance** - A reservation only covers the virtual machine compute costs. It doesn't cover additional software, networking, or storage charges.
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-**Azure Storage reserved capacity** - A reservation covers storage capacity for standard storage accounts for Blob storage or Azure Data Lake Gen2 storage. The reservation does not cover bandwidth or transaction rates.
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-**Azure Disk Storage reservations** - A reservation only covers premium SSDs of P30 size or greater. It does not cover any other disk types or sizes smaller than P30.
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-**Azure Cosmos DB reserved capacity** - A reservation covers throughput provisioned for your resources. It doesn't cover the storage and networking charges.
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-**SQL Database reserved vCore** - Only the compute costs are included with a reservation. The license is billed separately.
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-**SQL Data Warehouse** - A reservation covers cDWU usage. It doesn't cover storage or networking charges associated with the SQL Data Warehouse usage.
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- Azure Database for PostgreSQL
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- Azure Database for MariaDB
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- Azure Data Explorer
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- Premium SSD Managed Disks
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For Windows virtual machines and SQL Database, you can cover the licensing costs with [Azure Hybrid Benefit](https://azure.microsoft.com/pricing/hybrid-benefit/).
title: Understand how a reservation discount is applied to Azure Disk Storage
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description: Learn how Azure reserved disks discount is applied to your premium SSD managed disks.
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author: roygara
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ms.service: cost-management-billing
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ms.devlang: na
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ms.topic: conceptual
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ms.tgt_pltfrm: na
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ms.workload: na
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ms.date: 01/13/2020
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ms.author: rogarana
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---
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# Understand how your reservation discount is applied to Azure Disk Storage
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After you purchase Azure disk reserved capacity, the reservation discount is automatically applied to disk resources that match the terms of your reservation. The reservation discount applies to disk capacity only, disk snapshots are charged at pay-as-you-go rates.
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For more information about Azure Disk reservation, see [Save costs with Azure Disks Reservation](../../virtual-machines/linux/disks-reserved-capacity.md).
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For information about Azure Disk reservation pricing, see [Azure Disk pricing](https://azure.microsoft.com/pricing/details/managed-disks/).
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## How the reservation discount is applied
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The Azure disk reservation discount is a "use-it-or-lose-it" discount and is applied to managed disk resources on an hourly basis. If you don't have any managed disk resources that meet the terms of your reservation in a given hour, then you lose a reservation quantity for that hour, unused hours do not carry forward.
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When you delete a resource, the reservation discount automatically applies to another matching resource in the specified scope. If no matching resources are found in the specified scope, then the reserved hours are lost.
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## Discount examples
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The following examples show how the Azure Disk reservation discount applies, depending on your deployments:
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Suppose that you have purchased 100 P30 disks (~1 TiB per disk) of reserved capacity in the US West 2 region for a 1-year term. Assuming that the cost of this sample reservation is $140,100. You can either choose to pay the full amount up front or to pay fixed monthly installments of $11,675 per month for the next 12 months.
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For these examples, assume that you have signed up for a monthly reservation payment plan. The following scenarios describe what happens if you under-use, overuse, or tier your reserved capacity.
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### Underusing your capacity
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Suppose that in a given hour within the reservation period, you have deployed only 99 P30 premium SSD of your 100 P30 disk reservation. The remaining 1 P30 is not applied during that hour and does not carry over.
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### Overusing your capacity
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Suppose that in a given hour within the reservation period, you are using 101 P30 premium SSDs. The reservation discount only applies to 100 P30 disks and the remaining 1 P30 disk is charged at pay-as-you-go rates for that hour. For the next hour, if your usage decreases to 100 P30 disks, then all usage is covered by the reservation.
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### Tiering your capacity
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Suppose that in a given hour within your reservation period, you want to use total of 200 P30 premium SSDs. For the first 30 minutes, you only use 100 for the first 30 minutes. During this period, your use is fully covered since you made a reservation for 100 P30 disks. If you then discontinue the use of the first 100 (so that you're using zero) and then begin to use the other 100 for the remaining 30 minutes, that usage is also covered under your reservation.
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## Need help? Contact us
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If you have questions or need help, [create a support request](https://go.microsoft.com/fwlink/?linkid=2083458).
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## Next steps
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-[Reduce costs with Azure Disks Reservation (Linux)](../../virtual-machines/linux/disks-reserved-capacity.md)
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-[Reduce costs with Azure Disks Reservation (Windows)](../../virtual-machines/windows/disks-reserved-capacity.md)
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-[What are Azure Reservations?](save-compute-costs-reservations.md)
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