Dirk_Brinkmann analyzes how enterprise customers can maintain cost control and commitment clarity in Azure by allowing service providers to manage subscriptions, detailing billing and governance implications.

Provider-Managed Azure Subscriptions: Cost Control and Commitment Clarity

Author: Dirk_Brinkmann

As a Microsoft Cloud Solution Architect supporting enterprise customers, I occasionally encounter a specific scenario where customers with an Enterprise Agreement (EA) or Microsoft Customer Agreement (MCA-E) allow a service provider (SP) to manage one or more of their Azure subscriptions via the SP’s tenant. This setup has notable implications for cost and commitment management, explored below.

Scenario Overview

A customer signs a contract with a service provider to outsource management of certain Azure resources. The customer retains control over resource pricing and expects usage to contribute toward their Microsoft Azure Consumption Commitment (MACC).

To achieve this, the customer links one or more Azure subscriptions with a Microsoft Entra ID tenant managed by the SP (e.g., “Subscription B”). The SP gets full RBAC access to the subscription and its resources, while the billing remains attached to the customer’s EA or MCA-E billing account/profile.

Implications and Responsibilities

Customer Perspective

  • Cost & Pricing:
    • Charges from Subscription B are billed to the customer’s EA or MCA-E account.
    • Resource usage pricing follows the negotiated customer price list.
    • Consumption in Subscription B, including eligible Marketplace offers, counts toward the customer’s MACC.
    • Customers have full cost visibility via Azure Cost Analysis at the billing account/profile level.
  • Commitments (Reservations / Savings Plans):
    • Shared commitments at the billing account/profile level benefit Subscription B resources.
    • Commitments scoped at Subscription B or lower can be purchased by the customer if their RBAC rights allow and policies permit such purchases.

Service Provider Perspective

  • Cost & Pricing:
    • The SP manages Subscription B resources and related costs operationally.
    • The SP’s cost insight is restricted to the subscription level; they do not see the customer-negotiated price sheet or invoice details.
  • Commitments:
    • SPs can purchase reservations or savings plans scoped at Subscription B or lower if permitted by customer billing policy and RBAC.
    • Commitments bought using the SP’s own billing account/profile do not apply to Subscription B.

Key Takeaways

  • Decoupled Ownership: Subscription management and billing ownership can be separated for flexibility.
  • Cost Control: Customers retain pricing, cost allocation, and commitment utilization controls, even when using managed services from SPs.
  • Governance: Proper alignment of RBAC and billing policies is critical for operational clarity and effectiveness.

Recommended reading: Microsoft Cost Management: Billing & Trust Relationships Explained

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