Microsoft is responding to complaints from European cloud providers with revised license conditions. The revision and changes to the guidelines apply from October 1, 2022. This is intended to enable companies to take their own licenses for products such as SQL Server and Microsoft 365 applications to a Windows server licensed from the cloud provider.
More flexibility when the portfolio fits
Microsoft promises several advantages with the license changes. It wants to make it easier for customers to use software on multitenant servers from cloud providers and to make it easier to license virtual machines. Microsoft is introducing virtual core licenses for this. Previously, Windows Server licenses required vendors to have access to the physical servers. With the changes, VMs can now also be licensed per virtual core.
As a further advantage of the adapted license model, Windows describes the fact that it ensures access to the Microsoft products required by customers from the partners, who can then offer them on the preferred platform. As a third advantage, Microsoft mentions that partners are better supported if they offer self-hosted desktop and server products. However, some providers are excluded from the choice of customers, such as Alibaba, Amazon Web Systems, Google and Microsoft itself. If cloud providers use the infrastructure of the companies mentioned, then the customers of these providers must continue to obtain the licenses from the respective provider – their own Customer licenses cannot then be used.
Pressure from the EU Commission as motivation?
In the official announcement, Microsoft talks about reacting to feedback from customers and partners with the license changes. However, some market observers assume that competition complaints from cloud providers to the European Commission are the trigger. As early as May, Microsoft therefore promised to work on its contract terms. In addition, the US group is being pursued by allegations that cloud tools such as Microsoft 365 and Teams are not compatible with the GDPR. Microsoft recently rejected this.
