Microsoft has announced a major overhaul to its Windows licensing regimes that make it rather easier to use its operating system in the cloud – without highlighting the reason for the change is to get the European Union off its back.

The biggest change is a virtual core licensing option for Windows Server, as opposed to paying for the OS based on the physical processor cores in host machines.

“Today, Windows Server is licensed by physical core, which means customers must have access to the physical server hardware to ensure that they have enough Windows Server licenses to cover all physical cores in the machine,” Microsoft’s chief partner officer Nicole Dezen explained in a Monday announcement.

“With the virtual core licensing option, customers can elect to license Windows Server by the number of virtual cores they are using in virtual machines, making Windows Server easier to license when virtualizing or outsourcing.”

Microsoft’s aim with this change is to get users migrating Windows Server into the cloud. But not just any cloud – the new license does not apply to Alibaba, Amazon Web Services, Google, and Microsoft. Instead the target is clouds run by Microsoft’s partner community. We’re also told the new rules otherwise apply worldwide.

Windows 10 and 11 have also been given a similar update, with holders of a Microsoft 365 F3, E3, or E5 license able to run the operating systems “on their own servers or on outsourcers’ servers … regardless of whether the user’s primary device has a Qualifying Operating System (QOS) — eg, Windows 11 Pro — and without the need for any additional licenses.”

That’s a change from the current regime that requires customers who lack a primary device with a QOS to acquire an add-on license to virtualize Windows 10 or Windows 11.

Microsoft revealed the changes in an advisory for partners and Dezen’s aforementioned statement, both of which paper over the real reason for the changes.

That reason is the legal action brought by European clouds who felt that Microsoft’s software licensing programs represented unfair competition and left them at a disadvantage. The Redmond giant made concessions to end those lawsuits, with Microsoft president Brad Smith promising, “we will make it easier than ever to license Windows Server for virtual environments and the cloud by relaxing licensing rules that reflected legacy software licensing practices, where licenses are tied to physical hardware,” in a May 18 post.

Three and a bit months later, the US mega-corp is spinning the introduction of these promised licenses as generosity towards its partners, with a nod to its peace offering with European cloud providers.

Dezen’s announcement briefly references that truce, and adds her observation that “we welcome ongoing feedback from cloud providers, customers, and other stakeholders as these changes are implemented.” And Microsoft’s corporate blog spins the licenses as a responsible change that helps smaller players thrive, without specifically mentioning the legal action.

Perhaps readers might care to remember this the next time Microsoft talks up its ethics?

The new licenses become available on October 1. Microsoft said training sessions for customers and partners will commence in coming weeks.

Other changes include allowing cloud solution providers (CSPs) to sell customers either one- or three-year subscriptions “for many products including Windows Server, Remote Desktop Services (RDS), and SQL Server.” More monthly billing options will also be made available for one-year offers.

Microsoft has also added a CSP “hoster” program that allows partners “to pre-build hosted desktop and server solutions that they can sell to customers along with licenses in CSP (license-included hosting), or to customers that already have licenses (customer BYOL-to-partner solutions).”

The desktop version of that program further complicates Microsoft’s virtual desktop options, which already include Windows 365 Cloud PCs, Azure Virtual Desktops, and the ability to run desktop-as-a-service wares from Citrix and VMware in Azure. Good luck figuring out how the new Windows client licenses apply across all that lot

Kind old VMware is updating its pricing model in a move to “continue meeting our customers’ needs”. Provided those needs involve paying more for CPUs with more than 32 cores.

You lucky people.

Pricing is being tweaked upwards where software is licensed on a per CPU basis. If the chip has more than 32 cores like, say, a 64 core AMD EPYC, then users will need to fork out for two CPU licences.

Both AMD and Intel will cheerfully sell punters chips with more than the requisite 32 cores, and utilising such chippery with the original per-CPU pricing was, in a very real way, a useful method of getting more bang for one’s buck from the software.

With Intel struggling to make enough of its high-end hardware to satisfy demand, AMD looked set to steal a march with the likes of the EPYC 7742. VMware’s pricing change will you make you think twice about the benefits of sticking a core-dense processor into a server with a view to keeping software costs down.

Virtzilla claims “the change moves VMware closer to the current software industry standard model of core-based pricing” and indeed, the likes of Microsoft and Oracle both use core-based pricing these days, although even the most determined apologist would struggle to suggest the move is aimed at anything other than boosting the bottom line.

Naturally, observers have been less than impressed by the move.

We Brits are still feeling the pain of British Airways yanking the free bar and sandwiches on short-haul flights in favour a paid-for alternative because, hey, everyone else does and people love more choice, right?

Hardware costs have tended to take a back seat to licensing expenses, but the focus on cores by some vendors will swing the pendulum back to the hardware. The Reg, however, doubts that VMware’s owner, in the form of hardware-slinging Dell, will be losing too much sleep over that.

The virtualisation subsidiary has generously given customers a bit of time before the core-counters come a-calling. Licences purchased for CPUs with more than 32 cores will be eligible for additional free per-CPU licences if bought before 30 April 2020. You’ll also need to be on a VMware support contract (and will be charged for Service and Support on those freebie licenses come renewal time.)

Still, “the vast majority” of the install base is still rocking 32 cores or less on Intel or AMD hardware (not hard for the former – most of Intel’s less exotic Xeons hover at 28 cores or less) so the impact won’t be felt until customers try to upgrade or scale their hardware.

My first experiences of 2017 have left me with a very unsettling feeling.  This feeling is that a large portion of Microsoft’s customers are just not aware of the transition grants as they migrate from the 2-proc to the 2-core licensing model for Windows Server. This my friends, is not your fault.

If you are purchasing your software through a reseller that hasn’t reached out to you about this, please do give them a hefty nudge!  Now I know this has been done before in a slightly wordier version, but thought a whittled down version might help those of you that suffer like I do with reading long winded documents.  Please find below, my ‘in-a-nutshell’ version of what you need to know: