Cloud in the EU: Microsoft revises its licenses in the face of discontent from the competition

On Monday, August 29, 2022, Microsoft released promised changes to cloud outsourcing and hosting, announced earlier this year.

These changes, which will take effect on 1er October 2022, still do not address some of the top customer and partner complaints that have led Microsoft to revise its policies in these areas.

Microsoft introduced outsourcing restrictions to its cloud licenses in 2019, including an outsourcing restriction, which resulted in customers paying more to run Microsoft software in non-Microsoft cloud environments. Customers who used AWS and Google Cloud as Dedicated Hosts to run Windows Server and customers were directly impacted, but some of them didn’t realize the magnitude of the impact until their contracts with Microsoft expire this year.

Microsoft’s changes to its “bring your own license” terms of service made their contracts more expensive if they wanted to run Microsoft software on anything other than Azure

Microsoft Business Practices Survey

Some European partners and customers have lodged a complaint with the European anti-competitive authorities. Microsoft has responded with a set of “European Cloud Principles” which officials say would level the playing field – to some extent – for partners and customers who want to run Microsoft software on certain cloud infrastructures. other than those of Microsoft.

What those principles didn’t include was what many customers were most interested in: the ability to run Microsoft software on Amazon Web Services, Google, and Alibaba. They focused on customers who wanted to move their software licenses to other clouds outside of these “listed providers”.

“This is simply a rollback and relaxation of the rules for Cloud Solution Providers (CSPs). It doesn’t change the complexities and limitations that plague ‘listed vendors’: Amazon, Google, and Alibaba, and their joint customers with Microsoft,” said Wes Miller, analyst at Directions on Microsoft. “While this is good news for a set of providers, there is no change to the complex and cluttered rules affecting these three providers and their customers. »

Guaranteed product access for cloud partners

Earlier this year, Microsoft officials said they would address some of the complaints from European cloud providers about restrictive cloud licensing policies that have led customers to pay more to run Microsoft software in cloud environments. non-Microsoft cloud. According to company officials, the list of changes Microsoft introduced today will make it easier for customers to move their software to partner clouds, ensure partners have access to the products they need to sell solutions that customers want and empower partners to create fast, scalable solutions.

Specifically, Microsoft is adding a new flexible virtualization benefit that officials say will allow customers with Software Assurance or Subscription licenses to use their own licensed software to build and run solutions on any infrastructure, excluding listed providers (AWS, Google, Alibaba). Customers wishing to run their own Microsoft-licensed software on these vendors’ infrastructure will need to purchase the licenses from them. And any user with a Microsoft 365 F3, E3 or E5 license will be able to virtualize Windows 10 or 11 on their own servers or on those of their subcontractors – provided that the latter are not AWS, Google or Alibaba – without having need additional licenses. (Currently, customers require a VDA add-on license to virtualize qualified editions of Windows 10 or 11).

Microsoft is also adding a new Windows Server virtual kernel licensing option as part of the flexible virtualization benefit, which will license Windows Server based on a virtual kernel instead of a physical kernel. as is currently the case. Microsoft officials said the change will make it easier to move Windows Server workloads to the cloud.

Microsoft’s August 29 blog post describes these upcoming hosting/outsourcing licensing changes in more detail, along with a few other changes.


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