Microsoft licensing model changes with Server and Cloud Enrollment

A new Microsoft licensing model is coming later this year, forcing enterprises to rethink current models and look to more cost-effective strategies.

Server and Cloud Enrollment, a variation of the Microsoft licensing model slated for introduction in late 2013,...

encourages and rewards enterprise users who adopt at least one Microsoft server or cloud technology across the enterprise for a minimum commitment of three years.

Server and Cloud Enrollment (SCE) requires Microsoft customers to commit the enterprise to at least one of four Microsoft components: core infrastructure, application platform, developer platform and Windows Azure.

Core infrastructure components include any Core Infrastructure Suite SKU, Windows Server System Center and CIS coverage for all Windows servers. Application platform components cover SQL Server with full Software Assurance (SA) support. Developer platform components include Visual Studio Ultimate and Premium with full SA support. And Azure components involve all Windows Azure cloud services.

In exchange for making a SCE commitment, Microsoft will offer a 15% discount for new license and Software Assurance purchases, 5% discounts on Software Assurance renewals, management options for Azure with System Center, and unlimited support. Other benefits are expected to include subscription-based licensing, which will allow enterprise users to retire or migrate workloads to or from the cloud as desired without being locked into long-term licenses.

Microsoft's move to the SCE licensing model means it will discontinue existing component enrollments, such as Enrollment for Application Platform (EAP) and Enrollment for Core Infrastructure (ECI). This will force current EAP and ECI customers to consider a SCE transition or to evaluate the pricing and availability of volume licensing programs without contractual obligations or minimum purchases.

Because SCE will affect the Microsoft licensing model and prices for enterprise products, enterprise customers need to talk with their current Microsoft value-added resellers to formulate a cost-effective licensing strategy for late 2013 and beyond.

This was last published in September 2013

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There's much more to the SCE than what you see here, and it's very difficult for a customer to actually net a discount, given that they may need to repurchase old licenses and add Software Assurance upgrades to software they never planned to upgrade. When you're adding 25% a year to a lot of software you already own, a one-time 15% discount on a few new licenses can never make up the difference. See the SCE webinar at http://msftadvisors.com/resources.html for a full examination of this problematic agreement.
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