"Decoding the Microsoft VDI Licensing Arcanum" aims to demystify complex Microsoft VDI Licensing

A couple of months ago, my talented colleague Falko Grøfe from Login Consultants Germany (and App-V MVP) did a presentation about MS VDI licensing. I was truly perplexed.

A couple of months ago, my talented colleague Falko Gräfe from Login Consultants Germany (and App-V MVP) did a presentation about MS VDI licensing. I was truly perplexed. Being a regular to BrianMadden.com, I already knew VDI licensing from a Microsoft point of view was broken. The VDI industry ‘fixed’ typical VDI adoption bottlenecks like storage, manageability and high-end graphics over the past few years—slowly but steadily improving the VDI business case. However, as Brian pointed out in this article (and even quitting the MVP program out of protest), I simply did not realize how backward Microsoft VDI licensing is. Falko’s presentation made me realize that every single organization that is serious about VDI is either (1) totally not compliant with Microsoft licensing or (2) spending beyond reasonable amounts of money to comply with the latest licensing changes.

After a few conversations about how amazingly complex the situation is, I suggested to Falko that he writes a white paper complete with costs. He did, and todayFalko’s masterpiece is available!

"Decoding the Microsoft VDI Licensing Arcanum" is a fantastic title in my humble opinion. At first, I also did not understand that ‘Arcanum’ is Latin for ‘secret’. But that is exactly how this papers content resonates with me. Your brain will hurt reading it, but it is a fascinating and eye-opening exploration of MS VDI licensing. And it does not stop there, Falko also covers the beautifully elegant, simple and cheap ‘SBC’ licensing. Going even one step further, MS VDI licensing is compared with what we like to call a ‘single user terminal server’ licensing strategy. This strategy is not very common, but is getting traction with some DaaS providers. The white paper goes into detail, but in short it is much less expensive to deploy single instances of Windows Server to individual users than it is to properly license VDI. We think this is a serious option for everyone considering VDI, not just DaaS providers. I really hope vendors will purposefully support this VDI scenario in their product, because it can surely boost general VDI adoption.

This is the management summary:

"Microsoft changed their VDI licensing regime many times in the last five years. They implicitly prohibited using standard Windows licensing for hosted desktops with the introduction of VECD licensing in 2008. Initially it was an add-on subscription (with costs) for Windows Software Assurance customers only. Microsoft then declared the VDA Use Right middle 2010, made it available as a free benefit for Win+SA customers and offered it as a leasable subscription licenses for Non-Win+SA devices. In April 2012 Microsoft established the new Companion Device Subscription License (CSL). Finally, the VDI Standard/Premium Suite licensing are discontinued.

This CSL addresses the use of a virtual Windows desktop also from secondary devices, namely for using personal devices in the internal network. This scenario is becoming rather typical nowadays, as more and more users use their own devices to access the corporate virtual desktop. The impact of CSL on complexity and costs is huge and should not be underestimated. The reality today is that it is practically impossible for organizations being serious about VDI (and consumerization of IT) to be compliant with Microsoft VDI licensing. 

At this moment Microsoft VDI licensing remains in stark contrast to the simplicity and much lower cost of Hosted Shared Desktop licensing (also known as Terminal Server or Server Based Computing).

With CSL, Microsoft now distinguishes between several criteria that need to be COMBINED to determine the right type of license or license addition. Current criteria are:

  • Accessed Operating System: Is the accessing device connecting to a Desktop or Server operating system?
  • Device usage: Is the accessing device the primary or a secondary device?
  • Ownership condition: Is the accessing device owned by the company or by the user (Bring-your-own)?
  • Logical location: Is the accessing device located inside or outside the corporate network?
  • Architecture: Is the accessing device based on an Intel x86 CPU architecture (32 and 64 bit), or is it based on other architectures like ARM?
  • Installed Operating System: Is the accessing device running a ‘normal’ version of Windows, is it running Windows RT or another operating system?

As a result of these developments, only providing the right to access hosted VDI desktops can cause costs of about 1.200 $ per user during a six-year period. For example, when thin-clients are used and access from personal devices like an iPad is allowed.

In contrast, licensing access to Hosted Shared Desktops essentially only requires one simple decision (choose between ‘per device’ or ‘per user’ licensing) and costs less than 300 $ per user during the same six-year period. 

Remarkably, customers, DaaS providers, the VDI industry in general and its resellers should be aware that - as an alternative - a scenario of dedicating an entire Remote Desktop virtual server to just one single user is cheaper than most VDI scenarios and gives users the same benefits, namely having their ‘own’ Desktop VM where they can do what they want. This ‘single user terminal server’ scenario is – with about $475 per user (6 years) not only 60% cheaper, but less complicated and legally more safe than standard MS VDI licensing."


If you truly want to understand how Microsoft VDI licensing works, and how the numbers add up when interesting scenarios are compared, download and start reading ‘Decoding Microsoft VDI Licensing Arcanum’ (free, registration required). 

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Very good whitepaper but I have one quibble: the RDS licensing section does not include pricing for the endpoint OS thus making the VDI vs RDS comparison somewhat misleading.

If a non-Windows endpoint device is used then obviously RDS is cheaper.

But if Windows is used on the endpoint, then the Win+SA license covers both the endpoint OS and the VDI OS. For RDS, the endpoint OS license is in addition to the RDS CAL.


Thanks! I can only agree, I wrote an article about this long time ago: www.brianmadden.com/.../with-last-weeks-VECD-licensing-change-is-windows-7-now-the-cheapest-client.aspx

Did you check out the comparison tables in the end? Also a 'free' scenario, where SA is 'given', is described. We are very much aware of SA benefits, this is mentioned in the paper, and there are many more benefits of SA than licensing the endpoint. However, comparisons would become infinitely more complicated if we would do this in this paper.


One other small note on Server OS licencing which adds to the complexity.  Each user/device actually needs both a base Windows CAL as well as an RDS CAL.  They are distinct licenses.  See https://bit.ly/19x0BQo .

The reason why this matters is because it alters the pricing between Standard Edition and Datacenter Edition.  Using Hosted Personal Server desktops with Standard Edition only requires the RDS CAL while using Hosted Personal Server desktops with Datacenter Edition requires both the base CAL and the RDS CAL.  This is because the Standard Edition comes with 5 base CALs included, while Datacenter Edition does not.  See https://bit.ly/1bryzXp .   Just a bit more complexity and absurdity.


@Danny: It is true that accessing a Windows Server OS requires a Windows Server (Access) CAL. and we did not include them into the calculations at all. I was a little 'simplyfing' here, bceause I asumed that in most organizations any user or device has to have a Windows Server CAL assigned anyway to access for instance file services .  


Hi Danny,

What you're referring to with respect to Standard Edition coming with 5 Server CALs is correct but what you pointed out refers to the OEM versions of Win Server.  That is not the case for volume license versions of Win Servers and I prefer the flexibility of the volume license versions.  

Secondly, even if you went with the OEM version of Windows Server Standard --- you get only 5 Server CALs and ability to stand up 2 Server VMs.  Well what if I had 300-500 end-users who need access?  Depending on what type of Hosted Server Desktops you want to set up --- you'll end up paying up the whazoo for Server OS licenses or you still have to pay up a considerable amount of Server CALs still missing in your count.  So in many cases of a *highly virtualized* Server OS environment (many Server VMs Per Host) - you're better off with Datacenter edition even if MS throws in 5 Server CALs in the Standard OEM edition.

Moreover - in highly virtualized environments - Datacenter edition with the unlimited virtual VMs (if you decide to have a whole bunch of Server VMs per Host) allows you to freely move VMs across Host Servers without worrying about compliance.  Remember, that each Server license covers Per Server up to 2 Procs.  If you have say a highly virtualized environment with a Cluster using say vsphere DRS - fluid movement of VMs from one host to another due to load-balancing can easily put you out of licensing compliance when using Standard Server OS licensing if you don't have enough licenses per host to accommodate the additional VMs that may come its way.    

Lastly, as mentioned by FGraefe --- the assumption is that most organizations will need Server CALs anyways.  You need a Server CAL for an end-user or device just to touch a Domain/AD Server.  So when comparing *relative* costs of the different Client Virtualization options to each other - you don't really have to include the Server CALs and you just assume it's a base CAL used/required in all Microsoft Server-based environments.

-Kenny Chan


Hi Tom,

'a desktop' also can mean something like 'Remote App', 'Published/Seamless App' or 'VM Hosted App'. From an MS licensing perspective it doesn't matter if a user sees an entire desktop or just one or a few applications. If the app or desktop is 'physically' executed inside on server OS, RDS CALs are required, if the app or desktop is 'physically' executed  on a desktop OS, Win+SA or VDI with their options come into play.

Common brokers (MS Remote Desktop Services, Citrix XenApp/XenDesktop, Dell/Quest and several others) all allow to control rights based on group memberships (some users see certain apps, some see other apps, some see an entire desktop). However, not all brokers support all of these presentation models (for instance Citrix offered access to 'seamless applications running on a desktop OS' and now offers the ability to include apps that are running physically on the user's device [but they don't emphasis the MS VDI licensing requirements for such scenarios).

You can control quite granular what users can do with their 'desktop'. Some organizations lock them down (users can't even change harmless things like a desktop wallpaper), some grant a lot of freedom (including the ability to download and run portbale applications, store everything on the destop, launch 'admin' tools like Regedit, CMD or MMC (though with limited modification rights). If you want, both VDI and the concept of Single User Terminal Servers even would allow user to install applications and to have (limited) admin privileges in their desktop. However you usually onyl grant that if the user does not share the OS with others.

You can mix device and user RDS CALs within you organization, you even can install/add both licenses onto your RD License Server. However (I think) you can not have one RD (Session) Server that issues user _and_ device RDS CALs. In contrast to Citrix, Microsofct doesn't rely on technical license enforcement for RDS that strict in all scenarios. (instead the license Agreement allows MS to come into your organization and performa a licensing audit).