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Licensing Windows Server 2016 - Are You Compliant?

People say, “The only constant in IT is change,” and that holds true in the licensing world. It’s hard to keep up with how software is being licensed, and that’s why companies like to depend on their IT providers like PCS to guide their decisions and keep them compliant.

One product that a lot of companies depend on is Windows Server. While you may think it’s as simple as purchasing a perpetual license, like what comes included with a desktop PC, its way more complicated. There are 4 major considerations when licensing Windows Server: your server’s CPU(s) size, the edition, if you have a virtualized environment, and what services your server will be running.

Licensing on a Per Core Basis

Starting with Windows Server 2016, Microsoft started licensing their product on a per-core basis instead of per-CPU as they did for Server 2012. Although this is more complex, Microsoft set a minimum per-core licensing requirement to make it a little easier. Their datasheet, which you can find here states,

A minimum of 8 core licenses is required for each physical processor and a minimum of 16 core licenses is required for each server.

This may seem frustrating for SMBs that say, “Well my server only has a single, 4 core CPU!” However, the price point is the same when compared to the minimum licensing that was previously set for Server 2012. So if you refer to the picture and graph below, although the server has 2 CPUs with 4 cores each (8 cores total), the server still has to have a 16 core license. Licenses are available in 2-core packs, so to get licensing for 16 cores, you would need eight 2-pack core licenses.


Considering Server Editions

server2Te two main versions of Windows Server are Datacenter and Standard. Most SMBs that aren’t heavily virtualized will go with Standard, while highly virtualized environments will go with Datacenter licenses. Your decision on the edition of Windows Server you go with depends upon your environment’s needs. A summary of the differences between editions and costs can be found to the right, which is also on Microsoft’s datasheet found here.

Licensing in a Virtualized Environment

Now comes the more complicated scenarios. First of all, it’s important to remember your server license is bound to the physical server CPUs. Think of it like the CPU being licensed, not the operating system. If we take our original server and make it into a Hyper-V host, which is Microsoft’s virtualization platform, we can run up to 2 Windows Server virtual machines (VMs). Each Windows Server Standard edition license gives you the rights to install 2 VMs on your host. So what happens when you determine you need to run another VM on your host? Well you have to license your CPUs again; in this case that’s another 16 core license. Remember though, each license gives you rights to 2 Windows Server VMs, so you would then have rights to install a fourth Windows Server in the future if needed.








To add more complexity, if your business decides you need multiple hosts for redundancy, load balancing, etc., you must license the host to be able to support all VMs that may run on that host. As you can see below, this scenario would require two 16 core licenses per host. This would give each host the ability to host 4 VMs if needed. As mentioned in the previous section, the Datacenter edition of Windows Server gives you the ability to run as many VMs as you want. However, if you do the math, the only time you’re going to save money when buying Windows Server Datacenter edition is if you are running 13 or more VMs.


Other Considerations When Licensing Your Server

While applications and services are in addition to Microsoft Server licensing, they are still necessary considerations when licensing your server(s). If you need to run any services, such as a file server, Exchange for email, a Sharepoint server, etc., those products also have to be licensed. CALs can get confusing also because there are CALs for different services as mentioned above, and they are purchased either as per-user or per-device CALs.

Finally, there is Software Assurance (SA). SA can be purchased on top of other Microsoft licensing that offers additional benefits. The most discussed benefit of SA is upgrade rights to newer versions. For example, if you have SA with your Windows Server 2012 license, you have rights to upgrade to Windows Server 2016 for no additional costs. However, there are many other benefits of having SA which can be found on Microsoft’s SA benefits chart found here.

If you ever have any questions regarding Windows Server licensing, or any other Microsoft licensing, please contact PCS so we can help you find what you need.

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