Total Business Magazine

Microsoft’s Licensing Changes and What It Means for Your Business

Following the recent news that Microsoft is making licence migration to the cloud more expensive, Alastair Pooley, Chief Information Office at Snow Software, explores how these changes to licensing rules will impact businesses.

Earlier this month, Microsoft announced a significant change to its licensing terms that would disrupt the way many of its business customers run its software in the cloud. As of October 1st, 2019, customers will no longer be able to use on-premises licenses purchased without ‘software assurance’ and ‘mobility rights,’ drastically effecting the ability to ‘bring your own license’ to dedicated cloud environments that are not Microsoft Azure.

This may not affect you if you are using the more common shared compute. Higher security or performance needs has led to some companies choosing to be the only tenant on a physical machine. For those customers this is likely to significantly increase their costs.

The use of dedicated instances, sometimes called ‘bare metal,’ enables you to completely isolate the physical hardware that your applications are running on from any other customer using your cloud provider. This may be needed to solve a licensing requirement which restricts you to a single server. Or it may be a compliance requirement to ensure that the server is completely isolated from any other workloads or software. It is already a more expensive option than the typical instance-based cloud computing where the hardware is shared by many customers.

Beyond potentially increasing the costs, this change adds complexity to an already involved licensing model. Ensuring you are compliant with the latest set of rules is always a challenge and many firms choose to use a software asset management (SAM) platform to track and manage all their licenses. Once implemented, such a tool can help to build an inventory of licenses and assist you in optimising your spending – no-one wants to be over-licensed and paying their providers for more than they need. A good SAM tool can also bring visibility of any software vulnerabilities that exist within your estate, managing your inventory is one of the top security controls essential in modern security frameworks.

Ensuring you are compliant with the latest set of rules is always a challenge and many firms choose to use a software asset management (SAM) platform to track and manage all their licenses.

Microsoft often changes their licensing rules, but in this case the discomfort comes from certain scenarios being cheaper when you use Microsoft Azure, rather than their cloud competitors e.g. Amazon Web Services or Google Cloud Platform. Understandably the other providers have criticised this approach which is reminiscent of the previous generation of Microsoft leaders rather than the more innovative and friendly Microsoft we have seen during the last five years under Satya Nadella.

Keeping track of your licenses as always is key to compliance and financial control for your business, so this is a timely reminder to make sure you understand how you are licensed for your cloud workloads. Complete visibility and control over software assets will be the only way for businesses to overcome the challenges presented by this and future licensing changes. Remaining agile and ready to adapt will be crucial to coming out on top.

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