Microsoft's mixed message on Windows Server 2012 licensing: What's the real story?

Last week, I wrote an article about how the new licensing for Windows Server 2012 should work, according to the documents that were made available. The short version of the article is that the documentation in the FAQ associated with the announcement says that there are two versions of Windows Server 2012 that support virtualization, Standard and Datacenter.

Last week, I wrote an article about how the new licensing for Windows Server 2012 should work, according to the documents that were made available. The short version of the article is that the documentation in the FAQ associated with the announcement says that there are two versions of Windows Server 2012 that support virtualization, Standard and Datacenter. The only difference between them (again according to the FAQ) is that Standard supports only two "virtual machines," while Datacenter supports an unlimited number of "virtual machines." I put quotes around the seemingly innocuous "virtual machines" because the terminology wound up being a point of contention among some readers. Taken literally, this would mean that for someone to use Hyper-V to deploy Windows 7 via VDI (or any other OS, that would consume more than two VMs on a single host), that they'd need to use the Datacenter version of Windows.

For the rest of the day this passed muster, but on Monday I started receiving comments from people who disagreed. Readers such as LustyD and JoeBlankenship, as well as Claudio Rodrigues on twitter (@crod) have weighed in that they believe the Server 2012 licensing is similar to the Server 2008 R2 licensing when it comes to virtual machines. They say that what Microsoft means in the FAQ is that with the standard edition of Server 2012, you are only allowed to run two other instances of Server 2012 on that box (called VOSEs, or Virtual Operating System Environments), and that there is no limit to the number of non-server OSes that you can run, such as Windows 7 or Linux.

Obviously, this is a big deal when it comes to licensing. In the example I used in the previous article, I used an estimate of 48 Windows 7 VMs per host. At a retail price of $4809 for Server 2012 Datacenter edition, that would make the price per VM $96.18. If a company could get away with buying Standard for those same 50 VMs, the per-VM cost is $17.64. Multiply that by hundreds or thousands of users, and you can see where there would be cause for concern if the model changed.

LustyD (Dave Lusty) posted in the comments of the article that he was going to ask his contacts at Microsoft about this issue. When he heard back, he posted: 

Hi all, I have received confirmation from Microsoft that there is definitely no limit on the number of VMs any edition of Hyper-V will run. The document should have said OSE in most of the places where it says VM.

The question you need to ask to get the correct answer consistently from Microsoft is whether there is a limit to the number of Linux VMs which can be run on Standard. The answer to this will always be no, thus confirming the lack of limitations. This then leads the person you are asking to confirm that the licence is refering to 2 OSEs rather than 2 VMs running on the host. Obviously you don't need to run Linux, this is just a good trick to get them thinking in the right context for the question about the licensing :)

As I said previously, Windows desktop editions are separately licenced and are neither included nor related to virtualisation rights on Server products.

Cheers

Dave

What's interesting, though, is that Brian and I asked the same question of Microsoft via live chat, which we initiated through the Server 2012 website. Here's the transcript of that chat:

[MS Representative]: Hello, how may I assist you today?

[Brian & Gabe]: For Windows Server 2012, I know there are two editions, standard and datacenter

[MS Representative]: Hi there. Happy to assist.

[Brian & Gabe]: But the licensing guide says that standard edition supports running up to two VMs

[Brian & Gabe]: but what if the VMs are not Windows Server?

[Brian & Gabe]: Like, can I run as many Linux VMs as I want on Windows 2012 Standard edition?

[MS Representative]: Correct. The VM's can run any server or desktop OS. You will still only have two virtual instances available with Standard when this software is released.

[Brian & Gabe]: so to be clear, the two VM limit of standard applies to ANY OS, not just Windows Servetr?

[MS Representative]: Correct.

[Brian & Gabe]: awesome. thanks. Can you point me to a document that explains this?

[MS Representative]: To clarify, what Server software are you looking to replace with this solution?

[Brian & Gabe]: This is for a VDI example

[Brian & Gabe]: so if we have one server that will run 100 VMs of Windows 7, he believes that this can be done with Windows Server 2012 Standard, but my understanding is that it must be done with Datacenter.

[Brian & Gabe]: Of course the clients are covered by SA

[Brian & Gabe]: So I'm only talking about the server licensing needed

[MS Representative]: This would require Data Center. Are you a Microsoft Partner?

[Brian & Gabe]: Perfect, thanks

[Brian & Gabe]: Can you point to a document that backs this up?

[MS Representative]: To make sure I provide the best possible resource, are you a Microsoft Partner?

[Brian & Gabe]: I'm a customer

[MS Representative]: Alright. I will be happy to learn more about your needs and align you with a Microsoft Partner for more information and a consultation.

[MS Representative]: What capabilities are you looking for within this solution?

[Brian & Gabe]: I don't want to talk to a partner.. I just want on clarification I on the licensing to confirm what you just told me

[MS Representative]: Got it. I recommend connecting with our Licensing Benefit Team at 1-866-230-0560 for more information.

[Brian & Gabe]: ok thanks

I've always made the joke that if you ask ten different people at Microsoft about licensing, you'll get eleven different answers, but I always thought it was a joke! Here we have a situation where two people asked Microsoft representatives the same exact question and got two different answers. The confusing pieces of information in the chat are:

[Brian & Gabe]: Like, can I run as many Linux VMs as I want on Windows 2012 Standard edition?

[MS Representative]: Correct. The VM's can run any server or desktop OS. You will still only have two virtual instances available with Standard when this software is released.

[Brian & Gabe]: so to be clear, the two VM limit of standard applies to ANY OS, not just Windows Servetr?

[MS Representative]: Correct.

And...

[Brian & Gabe]: This is for a VDI example

[Brian & Gabe]: so if we have one server that will run 100 VMs of Windows 7, he believes that this can be done with Windows Server 2012 Standard, but my understanding is that it must be done with Datacenter.

[Brian & Gabe]: Of course the clients are covered by SA

[Brian & Gabe]: So I'm only talking about the server licensing needed

[MS Representative]: This would require Data Center. Are you a Microsoft Partner?

That makes the answer as clear as mud. On one hand, we have the way business has been done in the past, which makes sense. You buy a server OS, and it comes with entitlements to run some number of virtual instances of that OS. Any other virtual machines are just there, licensed in their own appropriate way. But on the other hand, you have documentation and other evidence that suggests Microsoft made some big changes here. This kind of makes sense, because they've made some big changes in the way the different editions of Windows are broken up. Remember, Standard and Datacenter are functionally identical, with the exact same features across the board. According to Microsoft, the only difference now is the number of VMs each edition is allowed to run.

I asked CDW's Nathan Coutinho, who we always turn to for licensing information, and he believes that the representative in the chat misspoke, and that the situation as laid out by LustyD, JoeBlankenship, and Claudio is correct. With so many people saying the exact same thing, I'm inclined to trust them. That said, I'm still looking to Microsoft for clarification, because the documentation (and knowledge of their representatives) leaves a little to be desired.

As it stands today, though, I'm willing to change my tune on this and say that not much has changed since Server 2008 R2 in the way of VDI licensing with Hyper-V, spare the two-processor limitation that applies to both Standard and Datacenter editions.

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For VDI, couldn't you use the free Hyper-V Server 2012?  Then you just purchase the amount of desktop licenses you need to run.  If I remember correctly, this we mentioned by Jeff Woolsey from Microsoft at TechEd 2012.


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Clear as mud.


I believe the point is this.  The Server PAPER license gives you the rights to 2 instances of Windows Server.  Much like how Data Center gives you the rights to an unlimited number of instances of Windows Server.


I don't see how they could limit the number of VMs running in the environment unless they key limit lock the number of activations.  Because the base environment they have stated can be vmware, or Xen, or even stand-alone hyper-v.


It's a paper license, much like the old Per user TS licenses of 2003.  Used in an audit, but nothing preventing the launching of more instances.


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Yep, you're right, at least according to several other interpretations. It's unfortunate that the wording of the docs refer to VMs and not VOSEs.


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Gabe,


Thank you for writing this follow-up article.


I think if people look at the entire picture including all of the various documents about 2012 licensing, established definitions of licensing terminology ex: "virtualization rights", "instances", the overall market/business environment the conclusion they will reach is that Standard can run unlimited VMs (but only two VMs are licensed for Standard).


HOWEVER, Microsoft needs to clarify their words because how many people actually read/parse all of the documents carefully plus are aware of the history of ms licensing/market forces/products available?  The same confusing language regarding VMs is repeated on several web pages.


The primary thing that is holding you or me or anyone else from knowing 100% what is the correct answer is that the updated Product Use Rights and final EULA documents for 2012 are not available.  If they were we would be able to read the actual legal documents to see what they say instead of web pages, faqs, etc.


From business angle it would make no sense to limit Standard to two VMs.  Someone can use Hyper-V Server 2012 for FREE to run unlimited VMs, but if they PAY for Standard they can only use the Hyper-V role to have two VMs!?  My (incomplete) understanding is that Hyper-V Server 2012 is not limited when compared to Hyper-V role in Standard.  The server GUI is missing, obviously, which makes things tougher.


From a parse-wording-to-death angle they say that the only difference between Standard and Datacenter is virtualization rights.  Virtualization rights has been well defined by Microsoft to mean your right to run the specific licensed product in a VM.  I am simplifying the definition but that is the gist.


I think the rep you chatted with does not know what they are talking about.  Big surprise to you I am sure. :-)


Microsoft needs to revise their words or else it is going to hurt them. Reasonable people will read it the same way you did and conclude that they should use a different server/hypervisor because Microsoft is forcing them to use Datacenter for virtualization.  Or maybe they will be aware of the free Hyper-V Server and conclude they must use that if they do not want to pay for Datacenter on every virt server.


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All they need to do is to change the BS/confusing terminology, full of stupid acronyms like VOSE and simply state that you can run virtual machines with the OS you acquired running on them. So if you buy Datacenter you can run as many VMs as you want with Windows Server 2012 or older (due to downgrade rights if I am not mistaken). If you buy Standard you can run two. Simple as that.


When you guys started the discussion around VDI, even though Microsoft is indeed retarded when comes to licensing, requiring Datacenter to run Windows 7 or XP VMs (unlimited) would be double taxing VDI (as you need licenses or SA for the desktop OS), what makes no sense at all.


Resuming the whole story: all you need for VDI is the cheapest Windows Server 2012 you can get (desktop licenses aside of course).


If you will run Windows Server VMs then, depending on how many and the actual size of the physical HW, Datacenter may be the way to go.


CR


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Why do I get the feeling someone is going to ask about this next week in my MS Licensing session at BriForum?  Bring it on people!  :)


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Thanks for the update Gabe. This is actually quite comical that they would answer like that. In your transcript they were so nearly right and then changed their minds!


FWIW I work for a Microsoft LAR in the UK and both our licensing team and our Microsoft licensing contacts have confirmed categorically that Standard is licenced to run unlimited virtual machines and that the 2 instances refers to the number of copies of Windows Server code you are allowed to run. I have raised the errors in the FAQ so hopefully these will get fixed for launch. For Server Standard 2012 this includes:


Server 2012 Standard


Server 2008/2008 R2 Standard/Enterprise


Server 2003 Std/Ent


Earlier editions would also be licenced but if you're still running those then 2012 is probably not for you...


Datacenter includes the rights to run any Windows Server edition past or present.


Anyone who is unclear please feel free to buy your licences from us so you have someone to point the finger at since we audit your licensing and recommend a plan.


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"All they need to do is to change the BS/confusing terminology, full of stupid acronyms like VOSE and simply state that you can run virtual machines with the OS you acquired running on them. So if you buy Datacenter you can run as many VMs as you want with Windows Server 2012 or older (due to downgrade rights if I am not mistaken). If you buy Standard you can run two. Simple as that."


If you read the full licensing doc then you'll see why they word it as they do, it is crystal clear and all scenarios are covered. The only issue is the new 2012 FAQ which uses the term VM where it should use VOSE (VOSE is very clearly defined as a running instance of the licenced code). This implies the limit Gabe reported and will hopefully be corrected shortly. Most of their licensing is common sense so if you think it sounds wrong it probably is.


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as a couple others here pointed out if you want to use Hyper-V 2012 to host your virtual desktops (no server OS's) you only need the FREE Hyper-V 2012 version, not Windows 2012 w/Hyper-V 2012. This was fully clarified in a Microsoft TechEd session channel9.msdn.com/.../VIR311


For the server OS's to support the broker and other components you will need to license the processors those run on...best practice would be to separate the hosts that host desktops from the hosts that host infrastructure/management of the solution or in most cases this goes on existing hardware that is licensed that is hosting the rest of the virtualized datacenter.


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Hi, this licensing has got me confused, we have a datacenter license (purchased by a previous employee) our company was under the impression you can install on the Hyper V host server and then use the same license to create Server 2012 R2 virtual machines on the host server. Reading further into this I think you have to purchase separate licenses for each Virtual machine you create is this correct? 
Thanks
Brenden
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