The Azure Hybrid Benefit for SQL Server allows you to choose where you use a SQL Server licence: either on-premises or in Azure. Not only that, you’re allowed to choose between an Azure virtual machine (IaaS) or the Azure SQL Database service (PaaS). This article is useful if you’re interested in an overview of the business motivations for choosing one Azure option over another: http://bit.ly/SQLOptions. Customers are eligible for the Azure Hybrid Benefit by having active Software Assurance on their licences or buying a Server Subscription.