MACC explained: Microsoft Azure Consumption Commitment

Microsoft defines it as an agreement to spend a specified amount on Azure over a defined period. It is negotiated with Microsoft, sits on a billing account, and runs for a fixed term. Some commitments carry milestones: predefined financial targets with their own due dates and amounts, which give Microsoft interim checkpoints inside the term.

The commitment is a floor on spend, not a budget and not a cap. You can consume more than the amount and nothing changes. You cannot consume less without consequence. That asymmetry is the reason sizing matters, and the reason a MACC belongs next to your choice of agreement: the commercial terms that justify the commitment are written into the same contract relationship.

Tracking is straightforward when the agreement is direct. In the Azure portal, under Cost Management + Billing, an EA shows the commitment under Credits + Commitments, and an MCA under Benefits. You see start and end date, commitment amount, remaining balance and status. A commitment is Active, Complete, Expired or Canceled. Expired means the end date passed without the amount being met.

Microsoft's own page for tracking a MACC sends you to the Azure portal to see which Azure services and Marketplace offers decrement the commitment, because eligibility is a property of the service and the offer. The rules that apply across the board are these:

Sources: Microsoft Learn, Azure Consumption Commitment benefit; Track your MACC; FAQ on using your MACC in Microsoft Marketplace; Track your CACO (eligibility table).

Reservations and savings plans are a frequent question. Microsoft's comparison table of CACO and MACC eligibility answers it: for an Azure Consumption Commitment, the up-front payment or the monthly payments for reserved instances and Azure savings plans count toward the commitment, while the monthly usage those purchases cover does not. In practice a reservation decrements the MACC by what you pay for it, and running it afterwards adds nothing. With up-front payment that pulls spend forward, so size the MACC with your planned commitment purchases in mind. Your own MACC events list shows each amount that decremented the balance.

Microsoft's rules for the benefit are specific. Look for the badge. Purchase inside the Azure portal, using an Azure subscription that belongs to your agreement. If you start on the public Marketplace website and the offer is eligible, the "Get it Now" button redirects you to the Azure portal to finish checkout. A credit card purchase made directly on the website does not count.

The FAQ adds three conditions that decide whether a given invoice counts: the offer is eligible at the time of purchase, the purchase is completed through the Azure portal, and it occurs inside your active MACC term. When all three hold, the full pretax amount is applied when Microsoft issues the invoice. Microsoft's documentation on multiparty private offers describes how a channel partner can extend an ISV offer to you through Marketplace, and states that for customers with a MACC every dollar of a MACC-eligible sale counts toward it.

Two exclusions stop people short. Azure prepayment cannot be used to pay for Azure benefit eligible solutions sold by partners. And exclusions might apply to Azure agreements signed before the Marketplace benefit existed. Microsoft refers eligibility questions on those to the account executive. The practical consequence: software you already buy for the Azure estate, such as monitoring, security or data platforms, may be routed through Marketplace at no change in price to move spend against your commitment. Do this only for software you would buy anyway, never to hit a number.

Microsoft documents the mechanics: if the MACC or a milestone is not met by its end date, an email alert notifies you of a shortfall charge for the remaining balance. The shortfall charge is an Azure prepayment credit applied to your account to fulfill the remaining commitment. You pay the gap, and the credit stays on the account.

That credit is less valuable than it sounds. Consumption charges covered by shortfall credits do not accrue toward your MACC. If you hold a shortfall credit and a later commitment, the credit pays for workloads without moving the new commitment forward. Compare this with an unmet commitment in a long contract: the effective price of the Azure you did consume goes up, because the same total commitment is spread over less actual use.

Microsoft sends alerts to billing account admins 90, 60 and 30 days before the commitment expires, and again 90, 60 and 30 days before each milestone end date. A MACC with a status of Expired means the end date passed without the full amount. Microsoft says to contact the account team in that case. Two practical rules follow. Make sure the alert recipients are people who still work for you and read that mailbox. And do the forecast against the remaining balance at least one quarter before the end, because a shortfall can only be avoided by eligible consumption, and eligible consumption takes time to ramp.

Microsoft sets no formula for this, so what follows is our working method, not a Microsoft rule. The commitment is a floor. The cost of setting it too high is a shortfall. The cost of setting it too low is a weaker position in the next negotiation. We size it in four steps.

1. Take the trailing 12 months of invoiced Azure spend that would have decremented the commitment. Exclude anything covered by credits or prepayment, since those do not count.
2. Remove the waste you plan to cut. Rightsizing, deleting idle resources and moving to commitments shrink eligible spend, and the MACC should be sized on the lower number.
3. Add approved growth only: migrations with a funded business case and a go-live date, not roadmap ideas.
4. Split the total into a committed floor and an expected case. Commit to the floor, and plan against the expected case.

A worked example with stated assumptions. A company spent USD 1'200'000 on eligible Azure in the last 12 months. Credits covered nothing. FinOps work will cut about 12% of that, so the base becomes USD 1'056'000. Two migrations are funded and add USD 240'000 per year from month six, so about USD 120'000 in year one and USD 240'000 in year two. Two years of base alone give USD 2'112'000. Adding the approved growth gives USD 2'472'000 as the expected case. A floor at about 90% of the expected case, near USD 2'225'000, leaves room for one migration slipping by a quarter. Commit at the floor and negotiate the commercial terms against it, not against the expected case. The numbers are illustrative.

The cost levers matter here. A MACC sized before the savings are realized is a MACC sized on waste. See reservations and savings plans for the commitments that reduce rates, and Azure Hybrid Benefit for the license line that sits outside any compute commitment.

Microsoft states that the MACC functionality in the Azure portal is available only to direct Microsoft Customer Agreement and direct Enterprise Agreement customers, where a direct agreement is signed with Microsoft itself and an indirect one is signed through a partner. To view an EA's balance you need the Enterprise Administrator role. For an MCA you need Owner, Contributor or Reader on the billing account.

The consequence for contract choice is concrete. A company that wants a negotiated Azure commitment and visibility of the balance in the portal needs a direct agreement. A company that buys Azure through a CSP partner typically gets the flexibility and the partner's billing instead, and should ask the partner what, if anything, applies to commitments in that arrangement. Our comparison of EA, MCA-E and CSP shows the other axes of the decision: seat minimums, term, reduction rights and price protection. The MACC is one of the reasons larger Azure estates stay direct.

A related instrument is the Conditional Azure Credit Offer, CACO. It works the other way round. Prepayment purchases do not count toward CACO milestones, but spending the prepayment credits does, and Marketplace purchases are not eligible for milestone tracking. If you hold both, do not transfer the MACC rules to the CACO.