Microsoft adds Vista licensing for VDI and OS Streaming, but it's only for SA customers

On Monday, Microsoft announced a change in licensing that means they will officially support Vista when used in VDI and OS streaming (i.e. "diskless PC") scenarios.

On Monday, Microsoft announced a change in licensing that means they will officially support Vista when used in VDI and OS streaming (i.e. "diskless PC") scenarios. There are two parts of this announcement:

  1. A modification to the Vista Enterprise license agreement that allows customers to use Vista Enterprise on a diskless PC.
  2. A new product (well, a new license anyway) called "Vista Enterprise Centralized Desktop," which allows customers to access Vista enterprise sessions remotely running on server hardware.

As always, there's a catch. And it's a big one! In this case, both of these changes are only available to Software Assurance customers!

Let's dig into what this announcement means.

First of all, the modification to the Vista Enterprise license agreement that explicitly allows you to use Vista Enterprise on a diskless PC is geared towards OS streaming scenarios like Ardence. But why did Microsoft have to make a change to the license agreement? Haven't people been using Ardence for years?

Of course they have. The key is how the Microsoft licenses have been (and continue to be) worded. Microsoft desktop OS licenses (like Windows XP and Vista) are licensed per named device, not per user. The "named" part of "per named device" means that if one user accesses the OS from multiple devices, two device OS licenses are needed--one for each device--even if the user never uses both at the same time. When you get into the world of streaming OSes, it can be confusing as to what counts as a "device." Of course everyone knows that if you're streaming a single shared disk image to 100 users, you still have to buy 100 licenses (even though it's just one single installed instance of Windows). That's not the problem.

The problem is that you have to buy a full OS license for every device a user connects from. So a scenario where each user is streaming their own image to multiple computers (not at the same time), you would still need to buy separate licenses for each computer.

Of course in reality, no one did this. People felt that as long as they had an XP Pro license for each user, they were covered. And since Microsoft didn't explicitly specify what was and wasn't allowed for this use case, it didn't really matter.

That all changed on Monday. Now Microsoft has explicitly granted the license right to stream Vista if you're using Vista Enterprise and if you're a Software Assurance customer. If you're not a Software Assurance customer? To bad--you can do it the old way.

The second part of this announcement is the new license called "Vista Enterprise Centralized Desktop" (VECD). This allows Vista Enterprise to be run in VMs on server hardware and then accessed via regular PCs or thin clients. Of course everyone reading this knows that this is called "VDI," but for some reason, Microsoft never mentions the term "VDI" in any of their announcements or new licensing documentation.

Here's what's weird about VECD: This is something you have to pay for! The price varies, depending on whether you will access the Vista VM from a thin client or from a regular PC. And of course since this is for SA customers only, Microsoft won't publicly disclose the prices.

For VECD, I'm not clear on whether it will be required in addition to your existing Vista Enterprise license, or whether it will replace your Vista Enterprise license. It would seem strange if it was an additional license, because since this VECD product is only available via SA, Microsoft has said that non-SA customers can continue to buy full Vista Enterprise licenses if they want to use VDI. This would suggest to me that the VECD license must be cheaper than a full Vista Enterprise license, and it would therefore be used by SA customers instead of a full Vista Enterprise license.

If you think about it, this is exactly what Microsoft did with the TS CALs. Back in the NT4 days, you had to buy a full Windows NT Workstation license to use Terminal Services. And then with Windows 2000, Microsoft created the TS CAL which was only about 40% of the price of a Windows 2000 Professional license. (One could even speculate that had SA existed in 2000, the TS CAL would've been SA-only too!)

Does anyone know anything more about this? Feel free to post what you know to the comments below.

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If businesses will buy it, that's just the way it's going to be.
I would guess whoever is seriously considering VDI with Vista is already under an enterprise SA agreement with Microsoft anyways.
What is frustrating is keeping up with the ins and outs of license restrictions. License management can be a full time job.
I am forever confused by Microsoft licensing.  I happened to run into this chart from Microsoft this morning which helps explain some of the different types of licensing and origanizational sizes they are intended for.
I learned from a Microsoft rep several months ago that OEM licenses of Windows XP are not supported in a VDI environment because the OEM license is specifically tied to a piece of hardware. 
At least now there is explicit statement that some form of Vista licensing is supported in virtual environments, so I'm glad to see this.  However, the Microsoft announcement did not mention OEM licensing, so I'm assuming that this limitation is still true.  In your article, you say "To bad--you can do it the old way."  By "old way", I'm assuming you mean the use of an Open, Select or Enterprise Microsoft agreement, but not OEM licensing.  Correct?
Also, what is your interpretation about the support of the various editions of Vista in a virtual environment?  Windows Vista Business, Ultimate and Enterprise editions all support Remote Desktop.  There's cost and feature differences in the editions, so this matters.  Probably only offered for Enterprise Ed. since the target is large organizations, but I wanted to get your impression.
According to Microsoft and several OEM's - there is an OEM diskless Vista license. 

Does anyone have any details on MS Licensing for XP SP2 in a VDI/DDI or OS Streaming design?

My understanding would be that it's OK for OS Streaming like Ardence/Image Manager/etc...  as the OS is still being used by specific devices, but I'm still being asked what the solution is regarding MS Licensing with Multiple Virtual desktops being run from heavy weight Iron in the Data Centre....????



Datacenter can now be used to have unlimited Windows machines on Virtual server (ESX) right?  If so,  how does this change affect that?



I have recently spoke with Microsoft UK and they have confirmed that VECD exists in two versions. One for "PC users" who have an existing PC with a copy of XP Pro or Vista, and the second for "Thin Client" users running on say a Wyse S10 device without a Microsoft desktop OS.
The way it VECD works is as follows -
PC Users
If you have a PC you need to upgrade to Vista Business Edition with Software Assurance. Via software asurance you are then entitled to run Vista Enterprise. Then you buy the (lower cost) version of Vista Enterprise Centralised Desktop (VECD) Annual Subscription. And thats it, you're licensed.
Thin Client Users
All you need to buy is the (more expensive) version of Vista Enterprise Centralised Desktop (VECD) Annual Subscription for Thin Client. This version includes the license for Vista Enterprise, hence the reason its more expensive.
Interestingly the VECD license policy allows you to connect to 4 simultaneous desktop sessions from one device.
One other question I have is - If you're hosting desktop sessions on VMware and connecting to them via a broker (Citrix Desktop Server, Leostream, etc.) using the RDP services built into the OS, do you need a Terminal Services CAL. My thoughts are that you don't as the RDP license is already included in the OS, i.e. "Remote Desktop" access. And to further complicate this question, once Citrix announce their PortICA solution (in the October release of Desktop Server v2.0?) which provides ICA for XP/Vista, the requirement to use RDP will then also be removed.
For those who are curious, here's an example of the VECD pricing.
Assuming a new Band A Select Agreement with full 36-months to run the costs are as follows -
PC Users
Windows Vista Business English Upg/Sa Pack MVL w/VisEnterprise = £220
Win VisEnt centralDesktpSA English Monthly Subscription MVL = £4 (paid annually = £48 per year per device)
Thin Client Users
Win VisEnt centralDesktp English Monthly Subscription MVL (Thin Client Version) = £10 (paid annually = £120 per year per device)
I was actually surprised by these costs as they mean I can buy a Wyse S10-VDI thin client device and run a Vista Enterprise (or XP Pro) virtual desktop for £120 per year per device. Assuming £300 for a Wyse S10 and a 19-inch TFT gives a 3-year cost per device of £660 which is probably less expensive than a PC with software assurance on the OS.
If a company has an app that won't run under Vista and choose to run it under XP instead would the VECD license cover the downgrade ? In this situation the Company would be using the thin client model on VMware VDI say.

Hi all,
I've got several questions:
First, as far as I know VECD is only available in the Select or EA program. In open there are only upgrade licences available so you have to buy the OS via the OEM channel to get a full version. Does anyone know any other way to solve that?

Second question: If you want to access XP or Vista from a non XP device, like a thin client with Linux or ThinOS, you need an additional Remote Desktop License (RDL) to be allowed to access the XPs on the server, right?
Is this even neccesary when you use VECD?