An Exploration of the Microsoft SQL Fiscal Cliff

The objective of this article is to review the publicly available documentation available on SQL Server. This will look at a high level at the impact of the release of SQL 2012 and the per core licensing model introduced on April 1st 2012.

  • This article is not intended to replace the Product Use Rights or Product List or other binding contractual documents
  • The Use Rights or Terms of Service for each Product of Version are available within the Product Use Rights and further product-specific conditions or limitations on the acquisition of licenses of licenses or use of products are in the Product List
  • Please be aware that any licensing information could be subject to change. This document confers no rights and is provided for information purposes only.
  • Please be aware, emphasis may have been added to quotations and extracts from 3rd party sources.
  • If you would like to book a consultation, available under NDA , please drop me a note via email 

The Impact of the Per Core Metric

Many organisations  look pro-actively at cost saving and cost avoidance strategies for their software spend, but often don’t receive independent analysis derived from a global managed contract data-set.

SoftwareONE continue to conduct research cost analytics across their managed contract base to track trends in software licensing globally in over 80 countries.

As a simple example, our research unit conducted pricing analysis of SQL from from January 2010 to November 2013, in order to independently verify and asses the impact of the per core metric for Microsoft customers. The graph below, illustrates the impact of the implementation of the per core licensing metric based on Intel and AMD CPUs for SQL deployed in a POSE (Physical Operating System Environment) illustrates what we commonly term ‘the SQL fiscal cliff’.

This dataset accounts for:-

  • SQL Enterprise Edition Per Processor 2008, SQL Enterprise Edition Per Processor 2008 R2, SQL Server Enterprise Edition 2012
  • The core factor multiplier adopted by Microsoft to differentiate between Intel and AMD CPUs.
  • The cost impact of historical price increase aligned to the general availability of SQL Enterprise Edition 2008 R2 on May 1st 2010
  • The cost impact of the UK Price Increase in July 2012.

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Key Takeaways

  • The continuation of the Per Processor licensing metric would not scale revenue generation to CPU power.
  • The core-based metric will require greater analysis of underlying server infrastructure to satisfy compliance and vendor reporting requirements.
  • Single and Dual Core CPUs have a positive multiplier and successfully maintained revenue for Microsoft
  • As core density increases, AMD Opteron CPUs may start to cost more than Intel Xeon (as the negative multiplier has less effect)
  • Organisations that have SQL under an Enterprise Agreement, Enterprise Agreement Subscription, Enrollment for Application Platform are strongly recommended to plan for their contract renewal(s) pro-actively
  • It is recommended to work with SoftwareONE to plan your datacenter performance and optimisation strategy aligned to vendor licensing models.

Understanding which Software Use Terms Apply

It is recommended that organisations should be aware of when a particular Product Specific License Terms should be applicable. This can be incredibly useful in understand whether their current deployment footprint falls within the SQL 2008 R2 or 2012 licensing schema.

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The Product Use Rights (PUR) is a binding document, published quarterly by Microsoft and should be considered essential reading for organisations that are seeking to understand the software use terms for their SQL estate.

In June 2012, following general availability of SQL 2012 in April of the same year, Microsoft released an advisory licensing guide to assist customers with understanding the new licensing metrics, but also the transition rules for customers with existing investments in Software Assurance (SA) for SQL Server 2008 R2. This document was later updated in March 2013.

The virtualization licensing guide released in June 2012 (still available on the Microsoft SQL Website) provides a brief synopsis of the applicability of the Product Use Rights based on current or planned deployments of SQL Server:

“Product use rights for the originally licensed version and edition apply even if using downgrade or cross-edition deployment rights. For example, if a customer purchases a SQL Server 2012 license, SQL Server 2012 use rights apply even if the customer deploys SQL Server 2008 R2 (or an earlier version)”.

“If customers (who are eligible through SA), have upgraded from a previous version, the product use rights for the version running apply. For example, if a customer upgrades from SQL Server 2008 to SQL Server 2012, SQL Server 2012 use rights apply”

[Ref:  , June 2012, Page 10-11]

This is a good high-level synopsis, to be reviewed alongside the binding contract stack, including procurement contracts like an Enterprise Agreement and Select Plus Agreement.

  • The Microsoft Enterprise Agreement (EA), provides a detailed overview on the applicability of a PUR; wherein (Section 4) it states:  “The Product Use Rights in effect on the effective date of an enrolment will apply to the Enrolled Affiliate’s use of the then-current versions of each Product (excluding Online Services). For future versions, the Product Use Rights in effect when those future versions are first released will apply. In both cases, subsequent changes made by Microsoft to the Product Use Rights for a particular version will not apply to Enrolled Affiliate’s use of that version, unless Enrolled Affiliate chooses to have such changes apply. […]
  • Product Use Rights for earlier versions (downgrade). If Enrolled Affiliate runs an earlier version of a Product other the version that was current on the Enrollment effective date, the Product Use Rights for the version licensed, not the version being run, will apply. However, if the earlier version includes components that are not part of the licensed version, any Product Use Rights specific to those components will apply to Enrolled Affilliate’s use of those components.”

[Ref: Please refer to your specific Enterprise Agreement, Section 4]

The Microsoft Select Plus Agreement, also provides a detailed overview of the applicability of a PUR; wherein (Section 5) is states:

  • “Summary: Generally, Microsoft agrees to lock-in the Product Use Rights at the start of the agreement, for current versions, and on the date of the first release, for new versions, so that any subsequent changes Microsoft makes to the Product Use Rights will not affect any Registered Affiliates. A Special rule applies in the case of downgrades, as described below.”
  • “a. Product Use Rights. Microsoft publishes Product Use Rights for each version of each product.
  • (i) Product Use Rights for current and future versions of Products. The Product Use Rights in effect on the effective date on the agreement will apply to all Registered Affiliate’s use of then current versions of each product, regardless of the date of the Order. For future versions, the Product Use Rights in effect when those future versions are first released will apply. In both cases, subsequent changes made by Microsoft to the Product Use Rights for a particular version will not apply to Registered Affiliate’s use of that version.”
  • “(ii) Product Use Rights for earlier versions (downgrade). If a Registered Affiliate runs an earlier version of a Product than the version that was current on the Agreement effective date, the Product Use Rights for the version licensed, not the version being run, will apply. However, if an earlier version includes components that are not part of the licensed version, any Product Use Rights specific to those components will to the Registered Affiliate’s use of those components.”

[Ref: Please refer to your specific Select Plus Agreement, Section 5]


Summary

To summarise the advisory and high level contract documentation,  current and future versions of a product under Volume Licensing models (like the Enterprise Agreement), the Product Use Rights in effect on the date of the Volume Agreement effective date will apply. For future versions, the Product Use Rights in effect upon general availability will apply, subject to the caveats outlined in the contracts – but how does this work in practice ?

  • This means in practice, that a customer that procured SQL Server 2008 R2 Enterprise Processor License(s) added at signing, via an  Enterprise Agreement (EA) with, for example, a contract effective date of June 2011, would refer to the the most current release of the Product Use Rights available on the effective date of their enrollment (March 2011).
  • As an example, over the term of their enrollment, that same customer would see the release of SQL Server Enterprise Edition 2012 (on April 2012) and would have had the choice to upgrade (under new version rights available when a license is procured with Software Assurance) or continue to run SQL Server Enterprise Edition 2008 R2.
  • Should an customer have subsequently decided to upgrade, as stated in the licensing guide: “If customers (who are eligible through SA), have upgraded from a previous version, the product use rights for the version running apply. For example, if a customer upgrades from SQL Server 2008 to SQL Server 2012, SQL Server 2012 use rights apply”.

This is reasonably straight forward to ‘draw a line in the sand’ to understand the applicability of the relevant Product Use Rights. However this should be reviewed within the context of the whole contract stack to ascertain whether exceptions or special license grants could apply (see next section).


An Exception to Every Rule

The Product List is a binding document, published monthly by Microsoft is considered essential reading for organisations that are seeking to understand the software use terms for their SQL estate. It is critically important to refer to all binding product-specific terms to ensure your existing licensing and software assurance footprint is assigned and leveraged appropriately.

  • As  with SQL, the April 2012 Product List  (Note 88) Microsoft conferred under the then-current term, for a SQL Enterprise Edition Per Processor License customer who is eligible under SA (Software Assurance), to upgrade from the 2008 R2 version, could  “upgrade to and use SQL Server 2012 Enterprise Core software in place of SQL Server 2008 R2 Enterprise subject to the SQL Server 2008 R2 Enterprise processor license product use rights (as reflected in the January 2012 Product Use Rights).” [Ref: Product List, April 2012, page 143 of 166, Note 88].
  • As with SQL, the April 1st Product List  (Note 90)  Microsoft conferred under the then-current term, for a SQL Standard Edition Per Processor License customer who is eligible under SA, to upgrade from the 2008 R2 version, could “upgrade to and use SQL Server 2012 Standard Core software in place of SQL Server 2008 R2 Standard subject to SQL Server 2008 R2 Standard processor license product use rights (as reflected in the January 2012 Product Use Rights). Customers are additionally granted rights under License Mobility through Software Assurance and License Mobility within Server Farms. Customers should refer to the Product Use Rights for SQL Server 2012 Standard Core for license terms for License Mobility.”
  • This is a good example of the impact of the hierarchy of software licensing terms  (see prior article on this site) – on the software use terms for Microsoft Products. While the advisory guides are useful, they should be considered both non-binding  and also non-exhaustive in scope.

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The Software Use Rights  for each Product Version are available within both the Product Use Rights and further product-specific conditions or limitations on the acquisition of licenses of licenses or use of products are in the Product List.


SA Renewal Planning – SQL Server Datacenter Edition

Microsoft support transition to the per core metric for SQL Enterprise Edition based on a either a programmatic approach or evidence based approach based on technical reality

The following should be considered in good time prior to renewal of your organisation’s current agreement term(s) to plan effectively.  It is recommended to ‘draw a line in the sand’ and assess available license grants for SQL Enterprise 2012  per core licensing metric based on purchases made before, and planned on or  after,  April 1st 2015.

  • SQL Datacenter 2008 R2 Licenses with active Software Assurance bought prior to April 1st 2015
    • Please note: procured via an Enterprise Agreement enrollment, Open Value Subscription, or EES / under True Up process.
  • Will have access to license grants based on both a programmatic allowance and/or an evidence based approach based on the technical reality (See below)
  • Any SQL Server Datacenter Licenses procured on or after April 1st 2015 will not qualify for an evidence based license grant (See below)

At First Renewal (Prior to April 1st 2015)

Microsoft set out the following options at renewal for organisations with a volume agreement renewal prior to April 1st 2015. This enables organisations to renew Software Assurance (SA) on SQL deployed under the legacy per processor licensing model.

The Product List provides details of exceptions and license transitions; wherein, for Enterprise Agreement (EA) customers with  SQL Server Datacenter Edition 2008 R2 processor license, the customer “may acquire Software Assurance for SQL Server Enterprise core licenses without acquiring the underlying core licenses for a number of core licenses equal to the sum of (a) and (b)” […]

Microsoft will support transition to the per core metric based on a either a programmatic approach or evidence based approach based on technical reality

  • a. a number equal to the lesser of the number of qualifying licenses assigned to the server or the total number of physical processors on the server multiplied by the greater of:
  • i. Eight, OR
  • ii. the actual number of cores per physical processor multiplied by the appropriate core factor.  (In cases where the actual number of cores per physical processor exceeds eight, customers must maintain a record of the configuration of the SQL Server software running on the server (licensed instances running in operating system environments on the licensed server) and the physical hardware supporting that software immediately preceding Software Assurance renewal either using the Microsoft MAP tool or any equivalent software.)
  • b. a number equal to the number of qualifying licenses assigned to the server in excess of the actual number of physical processors on the server multiplied by eight.”

[Ref: See the Product List, April 2012,Page 136 of 161, Note 80]

However, please note the caveat of the wording in the Product List, could impact license grants measurably, as exemplified by the following statement:  “for every server a customer has correctly licensed under SQL Server 2008 R2 processor license product use rights”.

-It is recommended organisation should ensure they have appropriate time/date stamped and cogent evidence of compliance to underpin renewal into the core licensing schema.


First Renewal (On or After April 1st 2015)

Microsoft set out the following options at renewal for organisations with a volume agreement renewal prior to April 1st 2015:

“Customers who first renew coverage on or after April 1, 2015, may, for every server that is correctly licensed under SQL Server 2008 R2 processor license product use rights, acquire Software Assurance as following:

  • As provided in the first paragraph of this product note, licenses acquired before April 1st 2015 are qualifying licenses and customers may renew SA as per the terms in the “First Renewal Term (Prior to April 1st 2015) “ section above and,
  • For licenses acquired after April 1st 2015 customers may renew SA for eight SQL Server Enterprise core licenses without acquiring the underlying core licenses for every SQL Server 2008 R2 Datacenter processor license. For ongoing use of SQL Server 2012 on processors that require more than eight core licenses per processor customer has to acquire the additional core licenses.

Customers’ processor licenses are no longer valid upon acquisition of Software Assurance for core licenses under this offering. The option to acquire Software Assurance for SQL Server core licenses is not applicable to renewal of coverage under subscription programs.”

[Ref: See the Product List, April 2012,Page 136 of 161, Note 80]


SA Renewal Planning – SQL Server Enterprise – Per Processor

For organisations that have committed to SQL Enterprise Edition Per Processor Licenses with Software Assurance (SA); Microsoft support transition to the per core metric for SQL Enterprise Edition based on a either a programmatic approach or evidence based approach based on technical reality

The following should be considered in good time prior to renewal of your organisation’s current agreement term(s) to plan effectively.  It is recommended to ‘draw a line in the sand’ and assess available license grants for SQL Enterprise 2012 under the per core licensing metric based on purchases made before and planned on or  after planned April 1st 2015.

  • SQL Enterprise Edition Processor Licenses with active Software Assurance prior to April 1st 2015
    • This is completed via an Enterprise Agreement enrollment, Open Value Subscription, or EES under True Up process.
  • Will have access to license grants based on both a programmatic allowance and/or an evidence based approach based on the technical reality (See below)
  • Any SQL Enterprise Edition Processor Licenses Licenses procured after April 1st 2015 will not qualify for an evidence based license grant (See below)

[Ref: See the Product List, April 2012,Page 142-3 of 161, Note 88]


At First Renewal (Prior to April 1st 2015)

Microsoft set out the following options at renewal for organisations with a volume agreement renewal prior to April 1st 2015:

For Enterprise Agreement (EA) customers with  SQL Server Enterprise Edition 2008 R2 processor licenses with Software Assurance (SA) after general availability (GA), the customer “may acquire Software Assurance for SQL Server Enterprise core licenses without acquiring the underlying core licenses for a number of core licenses equal to the sum of (a) and (b)” […]

(-The Product List provides details of exceptions and license transitions)

Microsoft will support transition to the per core metric based on a either a programmatic approach or evidence based approach based on technical reality

  • a. a number equal to the lesser of the number of qualifying licenses assigned to the server or the total number of physical processors on the server multiplied by the greater of:
  • i. Four, OR
  • ii. the actual number of cores per physical processor multiplied by the appropriate core factor. (In cases where the actual number of cores per physical processor exceeds four, customers must maintain a record of the configuration of the SQL Server software running on the server (licensed instances running in operating system environments on the licensed server) and the physical hardware supporting that software immediately preceding Software Assurance renewal either using the Microsoft MAP tool or any equivalent software.)
  • b. a number equal to the number of processor licenses assigned to the server in excess of the actual number of physical processors on the server multiplied by four.

[Ref: See the Product List, April 2012,Page 143 of 161, Note 88]

However, as stated above, please note the caveat of the preceding wording in the Product List, (which could impact license grants measurably), as exemplified by the following statement:  “for every server a customer has correctly licensed under SQL Server 2008 R2 processor license product use rights”.

[Ref: See the Product List, April 2012,Page 143 of 161, Note 88]

It is strongly recommended that organisations should ensure they have appropriate time/date stamped and cogent evidence of compliance,   to underpin renewal into the core licensing schema to ensure SA maintenance renewals relying on license grants can stand the test of time when potentially scrutinised later by Microsoft or a  ‘forensic’ license auditor like KPMG or Ernst & Young, or PWC.


First Renewal Term (On or After April 1st 2015)

Microsoft set out the following options at renewal for organisations with a volume agreement renewal prior to April 1st 2015:

  • First Renewal Term (on or after April 1, 2015): Customers who first renew coverage on or after April 1, 2015 will be provided an opportunity to acquire Software Assurance for core licenses for the qualifying licenses they acquire prior to that date. See the June 2012 Product List for details.
  • Customers’ processor licenses are no longer valid upon acquisition of Software Assurance for core licenses under this offering.

[Ref: See the Product List, April 2012,Page 43 of 161, Note 88]

The Product List for June 2012 makes the following statement [Section 89]:

  • “First Renewal Term (on or after April 1, 2015 Customers who first renew coverage on or after April 1, 2015, may, for every server that is correctly licensed under SQL Server 2008 R2 processor license product use rights, acquire Software Assurance as following:
    • As provided in the first paragraph of this product note, licenses acquired before April 1st 2015 are qualifying licenses and customers may renew SA as per the terms in the “First Renewal Term (Prior to April 1st 2015) “ section above and,
    • For licenses acquired after April 1st 2015 customers may renew SA for four SQL Server Enterprise core licenses without acquiring the underlying core licenses for every SQL Server 2008 R2 Enterprise processor license. For ongoing use of SQL Server 2012 on processors that require more than four core licenses per processor customer has to acquire the additional core licenses.
  • Customers’ processor licenses are no longer valid upon acquisition of Software Assurance for core licenses under this offering. The option to acquire Software Assurance for SQL Server core licenses is not applicable to renewal of coverage under subscription programs. Only qualifying licenses apply when determining the number of core licenses in a) and b) above.

SA Renewal Planning – SQL Server Enterprise –  Server/CAL

Microsoft  extended certain rights to renew Software Assurance (SA) on SQL Server Enterprise  after the licensing model was discontinued on April 1st 2012.

The Product List provides details of exceptions and available license transitions, included as an extract below [Ref: Product List , November 2013, Page 164 of 187, Note 85]:

“SQL Server Enterprise Server/CAL Customers — Special Software Assurance Renewal Option

  • “Customers with active Software Assurance for SQL Server Enterprise Server/CAL licenses as of April 1, 2012 may, as an alternative to renewing their coverage for Enterprise, acquire Software Assurance for an equal number licenses for SQL Server 2012 Business Intelligence without acquiring the underlying licenses. Upon acquisition of SQL Server 2012 Business Intelligence Software Assurance under this offering, customers may no longer use SQL Server Enterprise under their qualifying licenses. Customers who acquire Software Assurance for SQL Server Business Intelligence under this offering also will not have the option to revert to SQL Server Enterprise coverage for their qualifying SQL Server Enterprise licenses.”

SQL Server Buy-out Option under EAP

  • “Customers will have an option to renew Software Assurance for SQL Server Enterprise Server/CAL licenses after June 30, 2012, however their only buy-out option at the end of their enrollment term, will be for core licenses.”

Ongoing Use of SQL Server 2008 R2 Enterprise

  • “Software Assurance customers who continue to use SQL Server 2008 R2 Enterprise under licenses acquired under their agreement or enrollment in effect on April 1, 2012 may use the software under SQL Server 2008 R2 Enterprise use rights during the current term and any renewal term. Customers who use SQL Server 2008 R2 Enterprise under downgrade rights under licenses acquired after renewal of their coverage must use the software under the use rights for the version licensed.”

[Ref: Product List , November 2013, Page 164 of 187, Note 85].


The 20 Core Limit

While the November 2013 Product List does not make explicit reference to a maximum compute capacity, the updated March 2013 Licensing Guide does provide a table that states the 20 core limit for SQL Server 2012 Enterprise Edition on the Server+CAL Licensing Model.

This important ‘hard-coded’ limitation is of critical importance when seeking to determine the viability of maintaining the legacy licensing model, when in comparison SQL Enterprise Edition on the Per Core licensing metric is set at a maximum compute capacity set by the OS.

[Ref: Microsoft SQL Server 2012 Licensing Guide, March 2013, Page 5 of 26]

Microsoft provided the following guidance, extracted from the March 2013 update:

  • “SQL Server 2012 Enterprise Edition software licensed under the Server+CAL model is intended and physically limited to only run on servers with a total of twenty cores or less:
  • »» There are now two versions of SQL Server 2012 Enterprise Edition software: a server-based version and a core-based version. Customers must run the software version for which they are
    licensed.
  • »» For customers running SQL Server 2012 Enterprise Edition server-based software instances in a physical environment, that OSE is only permitted to access a maximum of twenty physical cores. A per instance technical limit is also enforced.
  • »» For customers running SQL Server 2012 Enterprise Edition server licenses in virtual environments, each set of VMs associated with a single server license (up to four per server license) can only access up to twenty hardware threads of combined power at any time.”

[Ref: SQL Licensing Guide, March 2013, Page 25]


Planning for Renewal SQL Standard – Per Processor

For organisations that have committed to SQL Standard Edition Per Processor Licenses with Software Assurance (SA); Microsoft support transition to the per core metric for SQL Standard Edition based on a either a programmatic approach or evidence based approach based on technical reality

The following should be considered in good time prior to renewal of your organisation’s current agreement term(s) to plan effectively.  It is recommended to ‘draw a line in the sand’ and assess available license grants for SQL Standard 2012 under the per core licensing metric based on purchases made before and planned on or  after planned April 1st 2015.

  • SQL Standard Edition Processor Licenses with active Software Assurance prior to April 1st 2015
    • This is completed via an Enterprise Agreement enrollment, Open Value Subscription, or EES under True Up process.
  • Will have access to license grants based on both a programmatic allowance and/or an evidence based approach based on the technical reality (See below)
  • Any SQL Standard Edition Processor Licenses procured after April 1st 2015 will not qualify for an evidence based license grant (See below)

[Ref: See the Product List, November 2013, Page 168 of 187 Note 89]

At First Renewal (Prior to April 1st 2015)

For Enterprise Agreement (EA) customers with  SQL Server Standard Edition 2008 R2 processor licenses with Software Assurance (SA) after general availability (GA), the customer  “for every server a customer has correctly licensed under SQL Server 2008 R2 Standard processor license product use rights, the customer may acquire Software Assurance for SQL Server Standard core licenses without acquiring the underlying core licenses for a number of core licenses equal to the sum of (a) and (b):”

(-The Product List provides details of exceptions and license transitions)

Microsoft will support transition to the per core metric based on a either a programmatic approach or evidence based approach based on technical reality

  • a) a number equal to the lesser of the number of processor licenses assigned to the server or the total number of physical processors on the server multiplied by the greater of:
  • Four, OR
  • the actual number of cores per physical processor multiplied by the appropriate core factor. (In cases where the actual number of cores per physical processor exceeds four, customers must maintain a record of the configuration of the SQL Server software running on the server (licensed instances running in operating system environments on the licensed server) and the physical hardware supporting that software immediately preceding Software Assurance renewal either using the Microsoft MAP tool or any equivalent software.)
  • b) a number equal to the number of processor licenses assigned to the server in excess of the actual number of physical processors on the server multiplied by four.

Snapshot Overview of SQL Licensing Information Metrics

Under a Microsoft Audit, the assigned auditor will seek to ascertain and collect all information that can inform relevant licensing models applicable to your infrastructure; Therefore, taking a pro-active approach to understanding and tracking all applicable metrics can inform both undiscovered or unmitigated risk exposure for your organisation.

This can impact how much of an organisation’s existing licensing footprint can be leveraged, while informing a work-stream toward an eventual optimum approach to software procurement strategy.

This process will extend past what would be identified in a discovery tool. This is not just a matter of looking at the perpetual license footprint alone and mapping to the Version or Edition deployed. This requires a comprehensive overview of the estate from a “bottom-up” perspective and may require involvement of several stakeholders to ensure current and on-going approach to SQL is accurate, comprehensive and limits on-going risk exposure.

This includes, but not limited to:-

  • The Number of CPUs (Manufacturer, Model Series)
  • Physical Cores in the CPUs
  • Hyper-Threading Technology
  • Virtualization Platform and Configuration
  • Failover, DR and Cluster Configurations
  • Virtual Machines (VM) and DRS
  • Installed Software (Edition, Version)
  • Consolidation Strategy
  • New Project Requirements
  • Dev/Test databases
  • Licensing Dependencies
  • Implications of Multiplexing
  • Number of Internal and External Users

The information collected from your estate via discovery tool(s),  and stakeholder workshops as part of a systematic and comprehensive approach,  can help establish the full technical reality for your organisation to support an optimum licensing and investment strategy for SQL Server.


Licensing Update : License Re-Assignment

Under the Universal License Terms of the October 2013 Product Use Rights Microsoft provide the following guidance on the “Limitations of License Reassignment”:

  • Except as permitted below, you may not reassign licenses on a short-term basis (within 90 days of the last assignment) […]”

[Ref: Product Use Rights, October 2013, Page 11 of 117]

Under the hierarchy of the software use terms the Use Rights or Terms of Service for each Product of Version are available within the Product Use Rights and further product-specific conditions or limitations on the acquisition of licenses or use of products are enshrined  in the Product List. Accordingly, Universal License Terms will remain in effect unless explicitly retracted or amended as specified in either the General License Terms or Product-Specific License Terms and Additional Terms within the Product Use Rights and subsequent exceptions within the Product List.

As an example, under the subsequent General License Terms for Servers on the Per Core licensing model, Microsoft state a requirement for Software Assurance (SA) to support  reassignment of licenses within a server farm outside of the ‘90 day rule’ enshrined within the Universal License Terms:-

  • You may reassign licenses for which you have active Software Assurance coverage to any of your Servers located within the same Server Farm as often as needed. You may reassign licenses from one server farm to another, but not on a short-term basis (i.e., not within 90 days of the last assignment).”

[Ref: Product Use Rights, October 2013, General License Terms Page 46 of 117]

Understanding how Microsoft approach software use rights for license reassignment  is an essential area of focus if current and prior versions of SQL have been deployed in Virtual Machines (VM) and your organisation is seeking to understand whether they have sufficient licensing and Software Assurance (SA) ‘footprint’ to support the current (or planned) environment.

This is an important development, where upon general availability of SQL 2012 (April 1st 2012) Microsoft removed license mobility within server farms  as a benefit of the SQL Enterprise Edition License.

This departs from the legacy precedent of the extended use right being defined at within the Product-Specific License Terms for SQL Server Enterprise 2008 R2; wherein Microsoft continued to provide license mobility within server farms (as first introduced in September 2008) as an extended use right within the license:-

  • “License reassignment within a server farm. You may reassign software licenses to any of your servers located within the same server farm as often as neededThe prohibition against short-term reassignment does not apply to licenses assigned to servers located within the same server farm.

[Ref: Product Use Rights, July 2010, Page 64 of 136] (the first PUR publication following general availability of SQL 2008 R2 on May 1st 2010)

[Ref: Product Use Rights, January 2012, Page 54 of 147] (The last PUR prior to general availability of SQL 2012 – the next PUR available in the archive is listed as August 2012]

It is acknowledged that many organisations may not have anticipated this retraction to the extended Software Use Rights for SQL Enterprise Edition 2012 when first leveraging the benefits of server virtualization. This would not have been supported by vendor publication of advisory guidance on SQL Server Licensing two months after general availability:

  • License Mobility moved to an SA benefit with the release of SQL Server 2012. So any license covered with SA, regardless of which version or edition of the software is deployed, will have License Mobility rights

[Ref: Microsoft SQL Server 2012 Virtualization Licensing Guide, June 2012, Page 11]

The unmitigated risk impact for organisations  can be considerable if database ‘sprawl’ has continued unmonitored. Leading organisations sometimes unknowingly, to be pulled under new licensing schema.


License Re-Assignment During a Failover Event

Many organisations adopt failover technologies to re-assign  workloads from a primary server to a secondary standby server when a production server fails.

  • Under the SQL 2008 and SQL 2008 R2  Product-Specific-License Terms for SQL Server, a standby server that is considered ‘passive’ (and not running any active workloads or reports) would generally not require a license to be assigned. This includes back-up and restore related tasks under the passive designation.
  • This passive failover server rule  would also commonly support situations when a primary server suffers a hardware or software failure (or is taken offline for routine maintenance or patch management) and requires the secondary ‘passive’ server to take over completely for ‘temporary’ support.
  • A secondary server, utilised solely to maintain a copy of the database and will never take over from the primary does fall under the ‘passive’ designation, however the passive failover server rule will only support a single designated passive server under the allowance for each primary licensed server.

As as an extract below, the Product Use Rights (published in July 2010, Page 63 of 136) explained this exception as follows:

  • “Fail-over Servers. For any operating system environment in which you run instances of the server software, you may run up to the same number of passive fail-over instances in a separate operating system environment for temporary support.  The number of physical and virtual processors used in that separate operating system environment must not exceed the number of physical and virtual processors used in the corresponding operating system environment in which the active instances are running.  You may run the passive fail-over instances on a server other than the licensed server.”).

As an extract below, the Product Use Rights (published in January 2012, Page 58 of 147) – the last archived PUR before general availability of SQL 2012 – uses almost identical wording and explains the exception as follows:

  • For any OSE in which you run instances of the server software, you may run up to the same number of passive fail-over instances in a separate OSE for temporary support. The number of physical and virtual processors used in that separate OSE must not exceed the number of physical and virtual processors used in the corresponding OSE in which the active instances are running. You may run the passive fail-over instances on a server other than the licensed server.

Microsoft provided a guidance document, originally published in July 2008,  that provided guidance as on server ‘failover rights’ as follows:

  • When doing failover support, a server is designated as the passive server. The purpose of the passive server is to absorb the data and information held in another server that fails. A passive server does not need a license, provided that the number of processors in the passive server is equal or less than those of the active server. The passive server can take the duties of the active server for 30 days. Afterward, it must be licensed accordingly

[Ref: SQL Server 2008 Pricing and Licensing, July 2008, Page 2 of 5]

Similarly, Microsoft provide a guidance document, published in May 2011 provides the following guidance:

  • “If you are licensed to use SQL Server, you are allowed to run a certain number of instances of the software for passive failover support without having to license these instances separately. You may run the passive failover instances on a server other than the licensed server.
  • For any OSE in which you run instances of SQL Server, you may run up to the same number of passive failover instances in a separate OSE for temporary support. For processor licensing, however, the number of physical and virtual processors used in that separate OSE must not exceed the number of physical and virtual processors used in the corresponding OSE in which the active instances are running.”

[Ref: Licensing Management Series, A Guide to Assessing SQL Server Licensing, May 2011 – Microsoft Volume Licensing]

The wording of the Product Use Rights and prior released guidance, published in July 2008, seem to support interpretation of  the passive failover server rule as actually two separate allowances:

  1. A grant to use of  ‘passive failover instances’ on a ‘server other than the primary licensed server’.
  2. An ability to run SQL workloads on a single secondary server ‘running instances’ to support a  failover event ‘for temporary support’

Importantly, the requirement to assign a license to the passive server only comes into effect in a use scenario outside the terms of use enshrined within the passive failover server rule:

Restrictions

  • The passive failover server rule would not apply if the standby server is not considered ‘passive’ and is running active workloads or reporting functions while the active node is operating. This does not include backup and restore related tasks.
  • The passive failover server rule would not apply  if the duration of the failover event exceeded ‘temporary’ support, this is commonly interpreted as 30 days.
  • The passive failover server rule would not apply if the server is sequestered for short-term for transaction load-balancing. This would then be governed by the Universal License Terms and require license reassignment or assignment of a new license.

License Re-Assignment During a Failover Event under the 2012 Licensing Schema

Upon the general release of SQL 2012, the Product-Specific License Terms do not appear to explicitly indicate a change in the passive failover server rule outlined above.

However, Microsoft Volume Licensing have communicated a change of how the operational logic of a failover event is conceptually approached, addressed in non-binding advisory guidance 16 months after general availability in their technet blog; under the following statement:

“[…] You do not require SA for SQL Server Fail-over Rights, but once you activate the Passive Fail-Over server in a DR then that Passive Fail-over becomes the active server (during a fail-over event) and it must be fully licensed for SQL Server.  You can accomplish this by assigning new licenses to the (now active) passive server, or by reassigning existing licenses from the primary server to the backup server once the instances of SQL Server on the primary server are inactive and no longer performing SQL Server workloads.” Wherein, Microsoft admit “What this means is that your SQL Server 2012 licenses without SA may only be reassigned once every 90 days.  This may not fit your fail-over strategy very well.”.

The non-binding advisory content of the  technet blog indicates that under the software use terms for SQL 2012, during a failover event the primary licensed server would need to have the license reassigned to the passive server at point of failover. The legacy approach, to license only the ‘active’ node of an Active/Passive SQL Server cluster seems to have been curtailed as an extended use right, and markedly departs from the license precedent of product-specific licensing terms for 2008 and 2008 R2 versions that allow one unlicensed secondary under the license terms of the assigned primary.

When pressed for guidance, Microsoft will commonly refer customers to the Product Use Rights, wherein the significance of this change is not immediately apparent, and appears to adopt similar terminology as reminiscent in earlier publications:-

  • “For any OSE in which you use Running Instances of the server software, you may use up to the same number of passive fail-over Running Instances in a separate OSE on any Server for temporary support. However, if you license based on Physical Cores and the OSE in which you use the passive fail-over Running Instances is on a separate Server, the number of Physical Cores on the separate Server must not exceed the number of Physical Cores on the Licensed Server and the Core Factor for the Physical Processors in that Server must be the same or lower than the Core Factor for the Physical Processors in the Licensed Server. If you license by individual Virtual OSE, the number of Hardware Threads used in that separate OSE must not exceed the number of Hardware Threads used in the OSE in which the active Running Instances are used.”

[Ref: Product Use Rights, October 2013, Page 48 of 136]

This appears to re-iterate the role of the primary server as the ‘licensed server’. The change in precedent is also not explicitly referenced in the non-binding advisory licensing guide document published two months after general availability in June 2012, but admittedly the wording does create confusion :-

  • The secondary server used for failover support does not need to be separately licensed for SQL Server as long as it is truly passive. If it is serving data, such as reports to clients running active SQL Server workloads, or performing any “work” such as additional backups being made from secondary servers, then it must be licensed for SQL Server”.
  • Primary server licenses include support for one secondary server only, and any additional secondary servers must be licensed for SQL Server. Note: The rights to run a passive instance of SQL Server for temporary support are not transferable to other licensed servers for purposes of providing multiple passive secondary servers to a single primary server.”
  • “When licensing SQL Server 2012 under the Per Core model, the number of core licenses must be based on the server that requires the higher number of licenses. This way, when the failover server takes over, it is adequately licensed. For a passive instance of SQL Server to be properly licensed, it cannot require more core licenses than the licensed primary system

[Ref: SQL Server Licensing Guide, June 2012, Page 14 of 25]


Final Thoughts

Any conflict in interpretation, and likely the crux of the matter, could likely be  dependent on  the interpretation of  the “fail-over rights” as a single or two separate allowances:-

  1. A grant to use of  ‘passive failover instances’ on a ‘server other than the primary licensed server’ under the ‘passive’ designation.
  2. An ability to spin-up ‘running instances’ on the secondary passive server to support during a  failover event ‘for temporary support’.

The technet blog interprets the passive failover server rule as limited to an allowance under the primary licensed server to run a secondary passive failover server under the ‘passive’ designation, but at point of failover and the secondary passive failover taking over completely, the license on the assigned primary licensed server is required to be re-assigned.

While the technet blog indicates a subtle, but significant change to how the fail-over rights in the Product Use Rights are interpreted by Microsoft and its subsidiaries, it is  strongly recommended to refer to all binding-documentation, rather than relying solely on non-binding advisory documentation, even Microsoft’s own websites and blogs.

This recent interpretation of fail-over rights could impact organisations that adopt a 30 day patching cycle and underwrites a strong case for Software Assurance (SA) for organisations seeking to enable ‘license mobility within server farms’ to allow re-assignment of SQL Licenses ‘as often as needed’ outside of the restrictive ‘90 rule’.

The half-life of the transactional approach to enterprise software procurement is certainly compounded by the revocation of SQL Enterprise Edition ‘license mobility within server farms’ as an extended use right, previously allowing re-assignment of SQL Enterprise Edition 2008 R2 and 2008  licenses  ‘as often as needed’ within the product-specific license terms; wherein upon general availability of SQL 2012, this has been sequestered and underwritten into the ever growing business case for SA.

For SQL Server Enterprise Server+CAL customers, organisations that are seeking to continue to leverage their legacy licensing investment should seek specialist advice.  While a legacy perpetual licensing footprint can be assigned to 2008 R2 or 2008 deployments of SQL Server; ‘database sprawl’, upgrades to server infrastructure, migration of workloads to 3rd parties or implementation of a virtualization platform can often pull an organisation, sometimes unknowingly, under a new licensing schema.


SQL Checklist

This is a non-exhaustive check-list to support your organisations approach to SQL Server when planning for contract renewal(s) or planning for a vendor audit:

  1. Request a Licensing Workshop and enable knowledge transfer.
  2. Assign an expert project team to manage your SQL Optimisation work-stream.
  3. Access and validate your Existing Volume Licensing and Software Assurance Footprint
  4. Get a clear understanding of all applicable Product-Specific License Terms as supported by all applicable binding documentation – assessed against  your business requirements.
  5. Adopt and assign all optimum Licensing Models as supported by all applicable binding-documents.
  6. Seek advice on identification of historical software license exceptions and license grants to minimise license spend.
  7. Request ‘vendor independent’ creation and analysis of an Effective License Position (ELP), usually completed under NDA.
    • Pursue a ‘clear line’ between  deployment,  licensing footprint and proposed final licensing solution.
    • Request independent review of adopted licensing metrics adopted in assignment of your license footprint to create the Effective License Position (ELP) and ask for this to be made transparent.
    • Seek independent advice on disclosure content and engagement strategy with software vendor.
    • Complete a valid Time/Date stamped inventory to support vendor license grants addressing all required license information metrics to ensure appropriate proof of license.
  8. Complete a datacenter Risk Assessment and construct a Risk Mitigation Strategy roadmap.
  9. If under audit, seek independent advice under NDA .
  10. Work with a SQL Architect to review current and planned Failover and DR strategy – optimally aligned to all applicable vendor licensing models.
  11. Request a comparative cost and investment analysis over 6 years, this should include all global sourcing options, with all applicable procurement contracts. – If appropriate build a negotiation team.

 


About

This website is a way to give back to the licensing community and as an information resource for all customers that work with Microsoft software and licensing. I hope you find it of value.

Tony Mackelworth is a Senior Licensing Specialist at SoftwareONE

If you would like to book an in-depth Licensing Workshop or Microsoft Strategy Workshop please drop me an email and connect with me on Twitter

Tony lives with his wife in Oxford, England.


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