Software licensing is complex and cumbersome, especially now that we're dealing with virtualisation and multiple cores. As one of the most ubiquitous software vendors, Microsoft affects millions of users every year with its software licensing model. It's complex, covering a wide range of options across a plethora of products.
Get your licensing wrong and you could find yourself on the sharp end of a Microsoft audit that can bring heavy penalties. Or you could end up paying too much for licences you don't use. Here are some common Microsoft licensing mistakes.
Not getting all the necessary licences
Because this is Microsoft, sometimes even your licences need licences. The volume (commercial) licence, which applies to most businesses, gives you multiple copies of a software title without installing it from physical media. Microsoft's Commercial Licensing Guide explains that when used to buy desktop operating systems, this is only an upgrade licence. You must already have a full Windows operating system license for the device you're installing on, either pre-installed on the PC or bought from a retailer. Don't get this wrong, or you'll be in the naughty corner.
Getting the core count wrong with Windows Server
Microsoft switched from a per-processor to a per-core licensing model for Windows Server 2016, so you pay for your licence according to the number of cores that you're running on. The company allows customers to license Windows Server in two-core packs.
However, don't overlook the minimum core count. Microsoft demands that you buy a minimum of 16 core licences per server (a minimum of two processors with eight cores each). Even if you only have two processors with four cores each, you must still buy the minimum or you'll be in violation.
Most people these days run their server operating systems in virtual machines (VMs). Beware that Microsoft's licensing model only allows you to run two guest Windows Server VMs per physical machine when using the Standard edition of Windows Server. If you want to run more than that, you'll need to buy more licence packs to cover it. Alternatively, you can license the Datacenter Edition to run unlimited VMs with Windows Server on a single physical box.
There's another potential slip-up with virtualisation. If you want to load balance, overflow, or fail over a Windows Server instance to another physical server, you'll need to buy the same number of licences on the second machine even if you barely use it.
If you want to move a licence to another physical server, you must reassign it. You can only reassign a licence once every 90 days. If you want to reassign licences more often than that, you need a Software Assurance licence, which adds a feature known as Licence Mobility.
Miscalculating Microsoft 365 licences
Many companies' Microsoft 365 licensing is a mess. A survey from SaaS company Coreview found that 56% of licenses for the productivity software are underused, oversized, or even unassigned. One problem is that companies often fail to reassign licences that employees stop using, leaving them inactive. In some cases, they buy licences and then forget to give them to employees or contractors. Another common mistake is purchasing licences with apps and features that employees don't use. Proper licence management is the key here.
If you haven't examined your Microsoft licences lately then it's worth ensuring that your current usage still reflects the terms of your contract. After a year like 2020, a call from Redmond's revenue enforcement Daleks is the last thing you need.