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Windows Server 2016 license shakeup affects enterprise choices

Organizations mulling an upgrade to a Windows Server 2016 license should understand the big differences in features available between the Standard and Datacenter editions.

In addition to new technical features in Windows Server 2016, Microsoft also changed how it licenses the server...

operating system, a change that administrators -- and their organizations -- should investigate before they upgrade.

Microsoft Windows Server 2016 is available for download on its various volume licensing portals and Microsoft Developer Network. The release of Windows Server 2016 also marks the start of the new per-core licensing plan for Windows Server 2016 license purchasers.

Along with the fairly dramatic change from per CPU to per core, Microsoft made other interesting decisions related to Windows Server licensing.

No feature parity between Standard and Datacenter editions

In Windows Server 2012 and Windows Server 2012 R2, Microsoft had the same feature set in the Standard and the Datacenter editions. There were no technical differences in the products, just license rights and product use restrictions. For example, in the Standard edition, you had rights to run two copies of Windows Server in VMs, while Datacenter gave unlimited virtualization rights on the server.

Along with the fairly dramatic change from per CPU to per core, Microsoft made other interesting decisions related to Windows Server licensing.

Microsoft changed this with the Windows Server 2016 license tiers. There are substantial differences in available features between Standard and Datacenter editions. Now, the advanced features in software-defined storage -- Storage Replica, Storage Spaces Direct -- virtualization and security -- shielded VMs and the Host Guardian service -- and the new networking packages -- virtual networking features such as the network controller, virtual "cloud-optimized" load balancer, virtual firewall and other appliance support -- based on technology from the Microsoft Azure platform only exist in the Datacenter edition.

Some key new features are in both editions, such as the Windows 10-like user interface, the Nano Server installation option and Docker containers. The number of virtualization instances allowed for each edition remains the same. Administrators running Windows Server 2016 Standard should note that nested virtualization -- a VM that runs inside a VM -- will use both instances you are allowed to run.

The features that are only available on the more expensive Datacenter edition license are the ones that make it worth considering an upgrade to Windows Server 2016. But if your organization does not operate at cloud scale or is uninterested in hybrid cloud, it will be tough to justify spending $6,155 for a Windows Server 2016 license, rather than $882 for a Standard license.

Nano Server requires Software Assurance

Software Assurance is an add-on program that is essentially a licensing surcharge that entitles the organization to benefits including access to future versions of the software during a two- or three-year period, increased usage rights, better support options and license mobility -- meaning, pay once for a license and use it on premises or in the public cloud. Microsoft requires Software Assurance for organizations that use the Nano Server installation option in production.

Software Assurance is priced by the server and costs $3,080 per 16-core server. This additional cost means only midmarket shops and enterprises will use Nano Server, because few small shops purchase Software Assurance. Microsoft defends this requirement by saying Nano Server is intended for fast-paced shops that continually integrate and innovate, and those customers want the new features as Microsoft updates this feature.

Test your knowledge of Windows Server 2016 licensing

Think you know everything you need to know about Windows Server 2016 licensing? Put your knowledge to the test with this quiz.

Free Datacenter licenses for VMware customers

As part of a competitive coup attempt, Microsoft offers VMware customers a free Windows Server Datacenter license contingent on those customers purchasing Software Assurance. This offer -- which expires on June 30, 2017 -- comes with the Nano Server deployment rights, entitlements to Windows Server upgrades within two or three years of the effective purchase date for the license plus Software Assurance, and free VMware upgrades.

Of course, nothing in life is free. Administrators would have to work out how to migrate VMware VMs over to Microsoft Hyper-V.  Azure Site Recovery could handle this migration, but it would still be a big undertaking. Also, unless the shop is small, Hyper-V VMs would require an additional management platform. Administrators who have an existing management suite would need to verify that it supports multiple hypervisors.

This offer will be compelling for some organizations, and it is a great way to get into Windows Server 2016 cheaply, but I do question how realistic it is to expect a massive number of VMware conversions solely based on this promotion.

Next Steps

Storage Replica offers backup and recovery option

Microsoft pushes cloud with Windows Server 2016

Nano Server a lighter option for Windows workloads

This was last published in November 2016

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