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Microsoft Server Subscriptions for Azure

Added into the May 2018 Microsoft Product Terms, we have Server Subscriptions for Azure AKA on-premises software via the CSP (Cloud Solution Provider) program.

What is it?

This new offering covers:

  • Windows Server Standard
  • Windows Server CAL
  • Windows Server External Connector
  • Windows Server Active Directory Rights Management Services (ADRMS) CAL
  • Windows Server Active Directory Rights Management Services (ADRMS) External Connector
  • SQL Server Standard
  • SQL Server Enterprise

And allows for 2 deployment methods:

In Azure

Or

On dedicated servers.

What is CSP?

The Cloud Solution Provider licensing program was introduced in 2015 and is aimed primarily at Microsoft partners, as a way of enabling them to easily bundle their IP and services along with Microsoft’s Cloud technology. As the name suggests, it is cloud focused – covering Office 365, EMS and Azure, along with Windows 10 (per user) and Microsoft 365.

What’s changed?

Microsoft have now made traditional on-premises server software available via CSP. This means those customers purchasing via CSP but not ready/able to go 100% cloud based (which is the majority) are now able to purchase Windows Server & SQL Server via the same agreement, on the same monthly pricing terms and from the same partner. It also means those CSP partners now have a wider range of things to sell available to them.

What are the rules?

Windows Server

When used in Azure

16 core licenses allow up to 16 cores in Azure, across up to 2 VMs.

Each additional 8 cores allow 8 additional cores in Azure and 1 additional VM.

These licenses will cover the cost of the “base instance” (the compute) but not any other related Azure costs such as storage, I/O etc. Customers need to indicate that they’re using the “Azure Hybrid Benefit for Windows Server” when creating the VM.

Windows Server licenses cannot be assigned to dedicated server and to Azure simultaneously, other than a one-time exception to allow for services to be migrated into Azure. The concurrency period is 31 days.

Once assigned to Azure, they may not be redeployed to customer’s servers for 90 days.

When used on dedicated servers

The licenses follow the same rules, terms and conditions as described for Volume Licensing in the Product Terms.

SQL Server

The use rights for the SQL Server Subscriptions for Azure are the same as those for the “Azure Hybrid Benefit for SQL Server”:

Qualified License Azure Data Service License to vCore ratio
SQL Server Enterprise (Core) General Purpose Managed Instance 1 Core license:4 vCores
Business Critical Managed Instance 1 Core license:1 vCore
Azure Data Factory SQL Server Integration Services (Standard) 1 Core license:1 vCore
SQL Server Enterprise Virtual Machines 1 Core license1:1 vCore
SQL Server Standard (Core) General Purpose Managed Instance 1 Core license:1 vCore
Azure Data Factory SQL Server Integration Services (Standard) 1 Core license:1 vCore
SQL Server Standard Virtual Machines 1 Core license1:1 vCore

1Subject to a minimum of 4 core licenses per virtual machine

When used in Azure

There will be no charge for the SQL service being used but all other costs, such as storage, backup, and I/O, are still chargeable – as well as the “base rate”, the compute itself.

Customers need to indicate that they’re using the “Azure Hybrid Benefit for SQL Server” when creating the VM.

SQL Server licenses cannot be assigned to dedicated server and to Azure simultaneously, other than a one-time exception to allow for services to be migrated into Azure. The concurrency period is 180 days.

Customers may deploy passive SQL Server fail-over instances within Azure.

Once assigned to Azure, they may not be redeployed to another environment for 90 days.

When used on dedicated servers

The licenses follow the same rules, terms and conditions as described for Volume Licensing in the Product Terms.

Software Assurance

One important distinction between CSP and Volume Licensing, is that CSP does NOT include Software Assurance. However, these new Server Subscriptions for Azure have certain equivalent SA rights.

In the case of Windows Server, these are:

  • Self-Hosting
  • Disaster Recovery
  • Semi-Annual Channel releases

And for SQL Server:

  • Self-Hosting
  • Disaster Recovery
  • License Mobility across Server Farms

Also, they allow for the use of new versions that are released during the subscription.

Software Assurance benefits that are not available via CSP include:

  • Planning Services
  • Technical Training
  • 24×7 Problem Resolution Support
Third parties

The fact that the licenses can be used on “Servers dedicated to Customer’s use” suggests these are not just servers on the customer site, but also servers held by 3rd party organisations – if they are dedicated to that customer, just as with Volume Licensing.

Conclusion

This move is a clear indication of Microsoft’s ongoing focus on the CSP program and their plans to make it a strong option for many organisations going forwards. Microsoft are very clear that CSP is not Volume Licensing, and there are several differences, but they’re also quite clear that CSP is/should be the preferred method for many organisations.

There is no Windows Server Datacenter available, which perhaps indicates this is aimed at the smaller organisations – those who do no need unlimited virtualisation rights on-premises and/or the additional, advanced features available with Datacenter edition.

Also, the SA benefits that are not available via CSP are typically critically important to larger organisations. I imagine the plan is that the CSP partner will provide those services (one way or another) so there is no need for those additional benefits.

This is an interesting, although not unexpected move from Microsoft and I’m interested to see how long it is until the next products are added, and which they will be.

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About Rich Gibbons

Rich has been in the world of IT and software licensing since 2003, having been a software sales manager for a VAR, a Microsoft licensing endorsed trainer, and now an ITAM analyst looking at software licensing and cloud.

A Northerner renowned for his shirts, Rich is a big Hip-Hop head, and loves travel, football in general (specifically MUFC), baseball, Marvel, and reading as many books as possible. Finding ways to combine all of these with ITAM & software licensing is always fun!

Connect with Rich on Twitter or LinkedIn.

3 Comments

  1. Junaid Mansoor says:

    We have an assumption that SQL prices are core based on do not require CAL. Correct?

  2. AJ Witt says:

    Correct – if the license you own is SQL per core you don’t need CALs. You must check the product number (SKU) and description to confirm this. Whilst the software itself is the same the license rules that apply depend on the SKU and description. Your license should specifically state it is “per core”

  3. sokheng says:

    does Window server and SQL server subscription can be used and installed on AWS?

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