Flexible Virtualization Benefit
In October 2022, Microsoft made a massive addition to its licensing – Flexible Virtualization Benefit. It benefits everyone – end clients and service providers.
Key outtakes
Any subscription license or license with Software Assurance can be "brought" to a third-party cloud or hosting platform (BYOL licensing).
Providers don't have to be authorised anyhow. However, Amazon, Google, Alibaba and even Azure are excluded.
Microsoft 365, Office 365, Windows 11, and even Windows Server are included.
Flexible Virtualisation is better than License Mobility.
Windows Server received an equivalent of License Mobility on-premises for the first time.
How to use Flexible Virtualization Benefit for BYOL
Ensure that you have subscription licences or licenses with Software Assurance.
Ensure that your hosting provider is not Amazon, Alibaba, Google or Microsoft. Otherwise, you don't have to check if your provider is eligible – every provider may accept BYOL.
Depending on the service provider, you may have to inform them that you plan to use your own licences – check with your service provider and their terms and conditions.
Assign licences to your hosted virtual or physical machines as if they were your own on-premises machines.
What is the Flexible Virtualization Benefit?
Customers with subscription licenses or Licenses with active Software Assurance (including CALs) may use licensed copies of the software on devices, including shared Servers, that are under the day-to-day management and control of Authorized Outsourcers.
The above quote is from Universal License Terms.
Let's explain the term "Authorized Outsourcer" using another quote:
Authorized Outsourcer means any third-party service provider that is not a Listed Provider and is not using a Listed Provider as a Data Center Provider as part of the outsourcing service.
Simply, it's any service provider except AWS, GCP, Azure and Alibaba. Azure has its own backdoors and [unfair?] competitive advantages, but let's not discuss them here.
Flexible Virtualization Benefit explained
Suppose you have subscription licenses or licenses with active Software Assurance. In that case, you have a right to ask your services provider to bring those licenses to their data centre and use them in any hosted environment: shared (multi-tenant) or dedicated (single-tenant).
There is no limit on the type of environment. Shared and dedicated environments are included.
All Microsoft software available as subscriptions or licenses with Software Assurance is included.
It seems simple.
Does Flexible Virtualisation replace License Mobility through Software Assurance?
No. LM through SA remains intact. It is the only way to bring your licenses to Listed Providers.
What are the updated BYOL rules?
Here's a summary of the updated BYOL rules:
Bring Your Own License | Before October 2022 | From October 2022 |
|---|---|---|
BYOL for Volume licenses with Software Assurance | - Permitted to any provider on dedicated hardware. - Multi-tenant ("public Cloud") BYOL is only permitted to providers with the License Mobility Partner status. | - Permitted to any Authorized Outsourcer. No difference between dedicated and shared hardware. - AWS, GCP, Alibaba: License Mobility through SA only. - Azure: License Mobility + Azure Hybrid Use Benefit. |
BYOL for Microsoft 365 Apps and Windows 11 VDI | - Permitted to any provider on dedicated hardware. - Multi-tenant ("public Cloud") BYOL is only permitted to providers with the QMTH status. | - Permitted to any Authorized Outsourcer and Azure. No difference between dedicated and shared hardware. - AWS, GCP, and Alibaba are excluded. |
BYOL for Server subscriptions via CSP | - Permitted to Azure via Azure Hybrid Benefit. - Permitted on dedicated hardware, excluding Listed providers. | - Permitted to any Authorized Outsourcer. No difference between dedicated and shared hardware. - Permitted to Azure via Azure Hybrid Benefit. - AWS, GCP, and Alibaba are excluded. |
Please let us know if you find any errors in the table above.
More flexibility for Microsoft 365 apps
Before Flexible Virtualization, you could not deploy Microsoft 365 apps to a Cloud provider's datacentre unless they had a rare QMTH ("Qualified Multi-tenant hoster") authorization. That was a severe limitation to Microsoft 365 apps BYOL.
Good news: Flexible Virtualization addressed it. Now, Microsoft 365 apps may be deployed with any Authorized Outsourcer.
Windows Server virtual core licensing
You may take (BYOL) subscription Windows Server licenses or licenses with active Software Assurance to any Authorized Outsourcer.
You have the option to license Windows Server virtual machines per virtual core. There is a minimum of 8 core licenses per virtual machine.
It's an option, so the current licensing models remain.
Talk to our Microsoft Licensing experts.
If you want more clarity on how this may affect your Cloud and Microsoft licensing strategy, please send us your questions using the form below. We'll help you prepare and re-strategize if necessary.
We see these changes already positively impacting end-customer licensing and digital transformation.
Frequently asked questions about Flexible Virtualization Benefit
What is the Flexible Virtualization Benefit?
Flexible Virtualization Benefit allows users with subscription licenses or licenses with active Software Assurance to "bring" their licenses to a third-party cloud or hosting platform. This applies to all providers except Amazon, Google, Alibaba, and Microsoft Azure.
Does Flexible Virtualization replace License Mobility through Software Assurance?
No, Flexible Virtualization does not replace License Mobility through Software Assurance. LM through SA remains intact and is the only way to bring your licenses to the listed providers.
Who is an "Authorized Outsourcer" in terms of Microsoft licensing?
An Authorized Outsourcer refers to any third-party service provider that is not a Listed Provider and is not using a Listed Provider as a Data Center Provider as part of the outsourcing service. In simpler terms, it's any service provider except AWS, GCP, Azure, and Alibaba.
Which service providers are excluded from the Flexible Virtualization Benefit?
The Flexible Virtualization Benefit excludes four major service providers: Amazon, Google, Alibaba, and Microsoft Azure.
Does Flexible Virtualization Benefit apply to Microsoft 365 apps?
Yes. With the introduction of the Flexible Virtualization Benefit, Microsoft 365 apps can now be deployed with any Authorized Outsourcer. QMTH authorisation is not required.
How to license Windows Server virtual machines with the Flexible Virtualization Benefit?
You can license Windows Server virtual machines per virtual core, with a minimum of 8 core licenses per virtual machine. This is an option, and the previous licensing models remain available.
What software is included in the Flexible Virtualization Benefit?
All Microsoft software available as subscriptions or licenses with Software Assurance is included in the Flexible Virtualization Benefit.
Can I bring my licenses to any hosting environment with the Flexible Virtualization Benefit?
Yes, with the Flexible Virtualization Benefit, you can bring your licenses to any hosting environment, shared or dedicated, except for those provided by Amazon, Google, Alibaba, and Microsoft Azure.
Can I take my Server subscriptions via CSP to any hosting platform?
Yes, Server subscriptions via CSP can be taken to any Authorized Outsourcer with no differentiation between dedicated and shared hardware. However, AWS, GCP, and Alibaba are excluded.