AWS, Reserved Instances

RDS SQL Server License Included vs BYOM, Explained

Two ways to license SQL Server on RDS and the four factors that decide which one costs less.

Aman Singh

Technical Content Writer, FinOps

Updated August 6, 2026

18 min read

Key takeaways

Both models run on identical managed RDS infrastructure. The principal difference is who supplies the SQL Server license, subject to the BYOM limitations covered below.

BYOM removes the license fee from your hourly rate but requires active Software Assurance. License Included costs more and AWS owns all compliance.

The choice depends on SA renewal cost, SSRS/SSAS usage, and upgrade plans. Conversion is one-way time RI purchases around it.

RDS for SQL Server supports two licensing models: License Included (LI), where AWS bundles the SQL Server license into your hourly rate, and Bring Your Own Media (BYOM), launched in June 2026, where you apply existing licenses through Microsoft’s License Mobility program and pay only AWS infrastructure costs.

BYOM closed a long-standing gap. Before June 2026, License Mobility extended only to self-managed EC2, so Software Assurance holders who wanted managed RDS paid for the license twice, once to Microsoft, again through the LI rate. BYOM removes that barrier.

The short answer

BYOM fits teams with active Software Assurance on SQL Server Standard or Enterprise, it removes the license fee from your RDS hourly rate. License Included fits teams without SA, or workloads needing Web or Express Edition.

That is a starting point, not a verdict. SA renewal costs, SSRS/SSAS compatibility, upgrade plans, and RI timing can each change the answer.

LI vs BYOM at a Glance

Decision Factor	License Included (LI)	Bring Your Own Media (BYOM)
Who pays for the SQL Server license?	AWS, bundled into the hourly rate	You, using existing licenses with active Software Assurance
Eligible editions	Enterprise, Standard, Web, Express	Enterprise, Standard (Developer for non-production only)
Software Assurance required?	No	Yes for Standard/Enterprise; not for Developer (non-production)
Setup complexity	None, select LI at instance creation	Medium: ISO to S3, Verification Form, BYOM engine version
Hourly compute cost	Higher, license included	Lower, infrastructure only
Account limit	10 LI instances per SQL Server edition by default	No LI limit applies
Reserved Instance behavior	Exact-size only, no size flexibility	Exact-size only, no size flexibility
Multi-AZ licensing	AWS manages both nodes	Your licenses must cover both nodes’ vCPUs
In-place major version upgrade	Supported	Not supported, new instance and migration required
License compliance responsibility	AWS	Customer
AWS License Manager integration	Not applicable	Automatic vCPU tracking when configured
Best for	Teams without existing licenses, or prioritizing simplicity	Teams with active SA and stable, long-term workloads

License Included: How It Works

Under License Included, AWS holds the SQL Server license and bundles its cost into the hourly RDS rate, you pay for compute, managed service overhead, and the license in one charge.

LI supports all four editions on RDS: Enterprise, Standard, Web, and Express. Web and Express are available exclusively under LI. By default, accounts are limited to 10 LI instances per SQL Server edition; request an increase from AWS support if your fleet is larger.

BYOM: How It Works

Under BYOM, you supply your existing SQL Server installation media and license rights to RDS. AWS charges no SQL Server license fee, you pay only for compute, storage, I/O, data transfer, and Windows OS licensing.

What BYOM requires

From Microsoft:

An active SQL Server license with Software Assurance on the edition you’re deploying (Standard or Enterprise)
License Mobility rights through SA (AWS qualifies as a third-party shared server)
The SQL Server RTM installation media as an ISO, via a Visual Studio subscription or the Microsoft 365 admin center

From AWS:

An S3 bucket in the same Region as your RDS instance, to store the ISO
IAM permissions covering AmazonRDSFullAccess plus s3:GetObject, s3:CreateBucket, and s3:PutObject

Submit the License Mobility Verification Form to Microsoft within 10 days of deploying AWS doesn’t validate this, so compliance is your responsibility.

The setup process

Setup is a one-time effort per SQL Server major version and edition:

Upload the RTM ISO to an S3 bucket in the target Region.
Create a BYOM engine version through the RDS console or CLI (roughly 20 minutes for the first instance of a given major version).
Create RDS instances against that engine version, the same way you would against a standard engine version.

AWS creates new BYOM engine versions automatically as minor upgrades arrive, so patches don’t require re-uploading media; if a minor upgrade is bundled into the LI-to-BYOM conversion itself, create the target engine version first. Only English-language media is supported, and the ISO must match the engine version.

Converting LI to BYOM

Existing LI instances can convert to BYOM in place of database migration, snapshot restore, or export/import. For Multi-AZ deployments, conversion is a rolling update: the standby is modified first, a failover follows (AWS cites 30–60 seconds), then the former primary updates.

For Single-AZ, the instance shuts down during conversion and restarts when complete. Read replicas must be removed before converting and recreated after; new replicas inherit BYOM.

Converting from BYOM back to LI is not supported, the only way back is creating a new LI instance and migrating your databases. Test your BYOM compliance process thoroughly before converting production instances.

Before you convert LI → BYOM.

SA verified

Active Software Assurance covers the edition and version on this instance.

Verification form ready

License Mobility form can be submitted to Microsoft within 10 days.

No SSRS/SSAS

Instance has no Reporting or Analysis Services option groups.

Read replicas removed

Replicas are deleted before conversion and recreated after.

Upgrade plan set

A major version upgrade path exists that works around the BYOM restriction.

One-way accepted

Team understands there is no conversion back to LI without a new instance and data migration.

What BYOM Does and Doesn't Cover

BYOM instances support the same feature set as LI, automated backups, point-in-time recovery, Multi-AZ, Performance Insights, Enhanced Monitoring, CloudWatch, minor version patching, and storage auto-scaling. The license source is the principal difference, the limitations below are the exceptions.

BYOM also integrates with AWS License Manager at no charge: once configured, it detects BYOM instances, tracks vCPU usage, and produces audit-ready compliance reports. Skip it and BYOM still works, but license monitoring becomes manual.

Limitations that don’t exist for LI:

Editions and versions: only Standard and Enterprise on SQL Server 2019 and 2022. Web, Express, and 2016/2017 require LI. Developer Edition is available under BYOM for non-production only full Enterprise features with no AWS license fee, and without the Software Assurance requirement.
SSRS/SSAS: option groups with Reporting or Analysis Services aren’t supported. Check with SELECT name FROM sys.configurations WHERE name LIKE ‘%SSAS%’, or review your RDS Option Group, before planning a conversion.
In-place major version upgrades aren’t supported moving from 2019 to 2022 means a new BYOM instance and data migration via native backup and restore.
Account/Region isolation: a BYOM engine version is specific to your account and Region, though the ISO can be shared across accounts.

The Cost Difference: LI vs BYOM

With active SA covering Standard or Enterprise, BYOM eliminates the license component from your RDS rate, you pay AWS for compute, Windows OS, storage, I/O, and data transfer only.

Enterprise LI rates run significantly higher than Standard per vCPU; under BYOM, both editions carry the same compute-only rate.

Compare rates for your instance class, edition, and Region in the AWS Pricing Calculator the difference is the license component BYOM removes.

But SA has its own renewal cost, and that belongs in the math: if you already maintain SA for other Microsoft products, it’s not an incremental cost and BYOM savings are effectively free; if you’d renew SA specifically to enable BYOM, factor that cost into the comparison.

One pricing nuance: AWS’s unbundled model separates compute from licensing charges on Intel 2xlarge and larger LI instances (disabling SMT by default). Compare BYOM rates against LI unbundled rates too for some instance families, unbundled LI sits closer to BYOM than bundled LI does.

When to Choose License Included

You have no existing SQL Server licenses with active SA
You need Web or Express Edition, or you’re running SQL Server 2016/2017
Your instance uses SSRS or SSAS option groups
You’d rather have AWS own all licensing compliance
The workload is short-term and wouldn’t recoup BYOM’s setup overhead

When to Choose BYOM

You hold active SA for Standard or Enterprise on SQL Server 2019 or 2022
Your instance doesn’t need SSRS or SSAS
You can commit to the Verification Form and to managing compliance independently
Your planned fleet exceeds the 10-instance-per-edition LI quota
This is a long-running production workload where the SA investment is already made, or you’re migrating from EC2 where License Mobility was already in use

Reserved Instances With LI and BYOM

An RI commits to a licensing model as well as an instance class, edition, and configuration license model is an attribute AWS matches reservations against. An LI RI doesn’t cover a BYOM instance and vice versa, if you convert an LI instance to BYOM mid-term, that RI is stranded.

If you’re planning a conversion, don’t buy a new LI RI right before it; wait for the existing RI to expire, then buy a BYOM RI for the converted instance. Full RI mechanics (exact-size matching, Multi-AZ, payment options) are covered in the parent guide.

Also read: RDS SQL Server Reserved Instances: Licensing, Editions, and Cost

Database Savings Plans: Available for Both Models

RDS SQL Server is eligible for Database Savings Plans under both LI and BYOM. Because a Savings Plan applies to all eligible spend regardless of licensing model, it’s the safer commitment mid-way through an LI-to-BYOM conversion it avoids the RI-stranding problem entirely.

Also read: AWS Database Savings Plans: flexible commitment discounts for SQL Server, RDS, Aurora, and other managed services

How Usage.ai Optimizes SQL Server Licensing Costs

Usage.ai flags LI instances on SQL Server 2019/2022 (Standard or Enterprise) that are BYOM conversion candidates based on edition, version, and option groups and quantifies the monthly saving per instance. It can’t verify Microsoft SA status directly.

For converted fleets, it purchases RIs matched to the correct licensing model and recommends Database Savings Plans during mixed-model transitions and both are backed by the Insured Flex buyback guarantee.

If a commitment purchased through Usage.ai ends up costing more than the equivalent on-demand usage, say an instance is decommissioned, resized, or changes licensing model mid-term the difference is paid back as cashback in real money.

Fee: a percentage of realized savings only $0 if Usage.ai saves nothing. 30-minute, billing-layer-only setup.

Evaluate with your own data

Planning an LI → BYOM migration?

Don't let the switch strand your Reserved Instances — check your commitment exposure first.

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Frequently asked questions

What is the difference between License Included and BYOM for RDS SQL Server?

LI: AWS manages the license, bundled into the hourly rate, across all four editions. BYOM: you supply existing Standard or Enterprise licenses via License Mobility and pay AWS for infrastructure only, it requires active SA and supports SQL Server 2019/2022. BYOM is AWS's SQL Server-specific equivalent of BYOL; unlike RDS for Oracle's BYOL model, SQL Server requires bringing the installation media itself, hence the name.

When did BYOM for RDS SQL Server launch?

BYOM launched on June 2, 2026. Before this, customers with SA had to run SQL Server on self-managed EC2 to use License Mobility, fully managed RDS had no BYOL path.

Can I convert an existing RDS SQL Server LI instance to BYOM?

Yes, in place, without database migration. Multi-AZ instances convert via a rolling update with a 30–60 second failover; Single-AZ instances restart during conversion. Converting back from BYOM to LI isn't supported.

What are the limitations of BYOM compared to License Included?

Only Standard and Enterprise on SQL Server 2019/2022; no SSRS/SSAS option groups; no in-place major version upgrades; engine versions are account- and Region-specific. You must submit the Verification Form within 10 days and manage compliance yourself.

Do I need Software Assurance for BYOM?

For Standard and Enterprise, yes, SA provides the License Mobility benefit required to deploy SQL Server licenses on AWS. The one exception is Developer Edition, available under BYOM for non-production use without SA.