Consumption-based licensing is a pricing model where organizations pay only for the Microsoft cloud services they actually use, rather than committing to fixed quantities in advance.
This model is most commonly associated with Microsoft Azure, where services such as compute, storage, and networking are billed based on real-time usage. Consumption-based licensing allows businesses to align IT costs directly with operational demand, making it easier to control spend and scale efficiently.
As Microsoft shifts away from volume-based licensing, consumption models have become central to modern cloud strategies, particularly within the CSP framework.
