Microsoft Azure Consumption Commitment (MACC) is the published Azure spend commitment vehicle. Annual spend commitments from $1M to $50M+ secure tier discounts of 7 to 15 percent against pay-as-you-go list. CTP (Customer Targeted Pricing, internally branded by Microsoft as Discount Aggregation Program in some regions) is the bespoke discount sleeve negotiated separately for strategic accounts, typically applied to customers committing $10M+ annual Azure spend with multi-service portfolios. CTP discounts run 15 to 32 percent against list, with custom terms on service inclusion and exit. PAYG is full list, no commitment.
This page is the 2026 decision reference for the three Azure commercial wrappers: MACC, CTP, and PAYG. List discount tiers, eligibility, term and exit mechanics, marketplace inclusion, and the per-spend-tier decision matrix. Built from Microsoft's MACC documentation (May 2026), the MCA and EA agreement structures, and advisor-led Azure commercial negotiations during 2024 to 2026.
What MACC is
MACC is the standard Azure consumption commitment available to customers on the Enterprise Agreement, the MCA-E (Microsoft Customer Agreement-Enterprise variant), and select MCA contracts. The customer commits to a total Azure consumption dollar amount over the agreement term, with annual breakdowns. Eligible Azure spend counts toward the commitment burn-down. The commitment secures a tier discount that applies to all eligible Azure consumption during the term.
| MACC annual commitment | Typical tier discount | 3-year minimum commit |
|---|---|---|
| $1M to $2M | 5 to 8 percent | $3M to $6M |
| $2M to $5M | 7 to 10 percent | $6M to $15M |
| $5M to $10M | 9 to 12 percent | $15M to $30M |
| $10M to $25M | 10 to 14 percent | $30M to $75M |
| $25M to $50M | 12 to 15 percent | $75M to $150M |
| $50M+ | 13 to 16 percent, typically transitions to CTP | $150M+ |
MACC commitment burn-down counts almost all Azure services: VMs, storage, networking, PaaS, AI services, Sentinel, Defender for Cloud, and a wide range of partner-built Azure-native services. Microsoft 365 spend, Dynamics 365, Power Platform standalone, Windows Server licences, and some specialty services do not count. The MACC eligible-services list is republished quarterly by Microsoft and should be reviewed before committing.
Azure Marketplace third-party software purchases now count toward MACC commitment up to 100 percent of the published purchase, as of 2024 policy changes. This is a material change. A $10M MACC customer who purchases $2M of third-party Azure-native software (Databricks, Snowflake on Azure, MongoDB Atlas, Confluent Cloud) on Marketplace satisfies $2M of the MACC commitment from those purchases.
What CTP is
Customer Targeted Pricing is Microsoft's bespoke commercial framework for strategic Azure accounts. CTP is not published. It is negotiated case by case, typically for customers committing $10M+ annual Azure spend with a multi-year horizon, a substantial Microsoft 365 or Dynamics 365 commitment alongside Azure, and a strategic-account designation from Microsoft.
CTP arrangements deliver three things MACC does not. First, a bespoke service-level discount table. CTP customers typically receive 15 to 32 percent off list on a defined service portfolio (compute, storage, networking, SQL, Cosmos, AI Foundry, OpenAI), with the specific discount per service negotiated. Second, custom services credits. Microsoft typically bundles $1M to $5M of professional services credits, FastTrack engagement, and architectural support into a CTP arrangement. Third, custom exit terms. CTP arrangements can include workload-portability commitments, data-export support, and explicit termination-for-convenience clauses that MACC does not.
The tradeoff: CTP arrangements typically require a 3 to 5 year commitment, with annual spend floors that ratchet upward year over year. Underspending triggers a true-up payment to Microsoft. The customer accepts higher commercial commitment in exchange for materially better unit pricing and bespoke terms.
The CTP threshold: Microsoft does not publish a CTP eligibility floor, but advisor-led negotiations during 2024 to 2026 routinely see CTP offered at $8M to $15M annual Azure commit for customers with significant Microsoft 365 attach or strategic-vertical positioning (financial services, healthcare, government, large retail). Below $8M annual Azure spend, customers should anchor on MACC tier discounts plus aggressive Reservation and Savings Plan placement.
What PAYG is
Pay-as-you-go is the no-commitment Azure billing model. The customer pays list price per service consumed per hour, billed in arrears, with no commitment, no minimum, and no early-termination cost. PAYG is the right answer for three customer profiles.
First, true-variable workloads. Organisations with genuinely unpredictable Azure consumption (research workloads, seasonal e-commerce, M&A pipeline experiments) cannot accurately forecast a MACC commitment and would risk underconsumption true-up if they committed.
Second, sub-$1M annual Azure customers. Below the $1M MACC entry threshold, the tier discount is not available. Reservations and Savings Plans still apply, but the surrounding commitment wrapper does not.
Third, customers in transition. Organisations migrating to or away from Azure during the next 12 months should not commit on MACC until the steady-state spend pattern is known. The cost of a misforecast commitment usually exceeds the cost of running at PAYG for 12 months.
The per-spend-tier decision matrix
| Annual Azure spend | Recommended wrapper | Key consideration |
|---|---|---|
| Under $500K | PAYG + Reservations + Savings Plans | No commitment vehicle available; optimise per-workload commitments only |
| $500K to $1M | PAYG + commitment vehicles, or small EA enrolment | Below typical MACC floor; EA Server and Cloud Enrollment sometimes opens MACC at lower thresholds |
| $1M to $5M | MACC | Standard tier discount path; CTP unlikely at this scale |
| $5M to $10M | MACC with marketplace inclusion strategy | Optimise Marketplace purchases to burn down MACC; evaluate CTP at upper end |
| $10M to $25M | CTP candidate | Negotiate CTP terms against MACC fallback; CTP wins when 15 percent+ discount achieved |
| $25M to $100M | CTP standard | Negotiate bespoke discount table, services credits, exit terms |
| $100M+ | CTP with custom commercial frame | Multi-year custom contract; co-engineering, co-marketing arrangements |
Marketplace inclusion mechanics
Azure Marketplace transactions count toward MACC commitment burn-down. This is the single most consequential 2024 policy change in the Azure commercial frame. The mechanics: a Marketplace-purchased third-party software product is billed through Azure, the customer pays the Marketplace vendor through Azure, and 100 percent of the eligible Marketplace charge counts toward MACC.
The list of qualifying Marketplace products is broad. Databricks, Snowflake (in some configurations), MongoDB Atlas, Confluent Cloud, GitLab Ultimate, JFrog Artifactory, HashiCorp Terraform Cloud, Datadog, New Relic, Palo Alto Networks Prisma, Wiz, and Lacework are all available on Azure Marketplace with private offer pricing. Customers can negotiate Marketplace pricing directly with the third-party vendor and have the transaction processed through Azure to capture the MACC burn-down benefit.
The optimisation pattern: a customer with $4M actual Azure consumption who has committed to a $5M MACC can purchase $1M of Datadog through Marketplace, satisfy the MACC commitment, capture the Datadog negotiated discount, and avoid the MACC underconsumption true-up. The play works for any combination of third-party software the customer was going to buy anyway.
Exit and re-negotiation
MACC commitments run for the EA or MCA-E term, typically three years. Underconsumption at term-end triggers a true-up payment equal to the unmet commitment. There is no partial-year exit. Customers who commit too aggressively pay the gap regardless of consumption.
CTP arrangements typically include annual spend ratchets and underconsumption true-up. Some CTP arrangements include termination-for-convenience provisions with notice periods of 6 to 18 months. The exit cost depends on the unconsumed commitment and whether the services-credit portion has been delivered.
At renewal, the negotiation focus shifts. MACC renewal typically captures a 1 to 3 percent additional tier discount when consumption grew during the term. CTP renewal is bespoke. The strongest negotiation position at CTP renewal is having a credible multi-cloud architecture and demonstrated ability to redirect workloads.
2026 negotiation levers
Four levers materially move the realised cost on the MACC or CTP wrapper.
First, commitment level versus expected consumption. Microsoft's commercial team will push for a higher commit than the customer's consumption history supports. The right commit is 85 to 95 percent of the 95th-percentile forecast consumption. Over-commitment locks in unused spend; under-commitment misses the tier discount.
Second, Marketplace integration plan. Customers who present a clear Marketplace burn-down plan during the MACC negotiation typically secure a higher commitment tier than warranted by direct Azure consumption alone, while controlling underconsumption risk through the Marketplace flexibility.
Third, CTP fallback. Customers approaching $10M annual Azure spend should be modelling the CTP arrangement in parallel with the MACC tier. The CTP framework can deliver a materially better unit price even at the same total commitment, and the threat of accepting MACC instead of CTP shifts Microsoft's commercial posture during the negotiation.
Fourth, true-up and exit terms. The standard MACC and CTP exit terms favour Microsoft. Customers with credible workload portability (containerised production, multi-cloud architecture, demonstrated migration capability) should negotiate explicit exit clauses, transition support, and partial-credit recovery on remaining commitment.
For the broader Microsoft commercial framework see Azure MACC negotiation, Reservations vs Savings Plans, MPSA vs CSP vs MCA vs EA, Microsoft EA Complete Guide, the Microsoft vendor hub, and our cloud contract negotiation service.