3 min read

Last week, Microsoft introduced a preview of Azure Dedicated Host that provides a physical server hosted on Azure and is not shared with other customers. The company has made few licensing changes that will make the Microsoft software bit expensive for the AWS, Google and Alibaba customers.

Currently, the dedicated host is available in two specifications, first is Type 1 based on a 2.3GHz Intel Xeon E5-2673 v4 (Broadwell) and has 64 vCPUs (Virtual CPUs). It costs $4.055 or $4.492 per hour depending on the RAM (256GB or 448GB).

Another is Type 2 based on the Xeon Platinum 8168 (Skylake) and comes with 72 vCPUs and 144GB RAM, it costs $4.039 per hour.

These prices don’t include the licensing costs and it seems Microsoft is trying to bring changes in this area. 


Last week, the team at Microsoft announced that they will modify their licensing terms related to outsourcing rights and dedicated hosted cloud services on October 1, 2019. The team further stated that this particular change won’t impact the use of existing software versions under the licenses that are purchased before October 1, 2019.

The official post reads, “Currently, our outsourcing terms give on-premises customers the option to deploy Microsoft software on hardware leased from and managed by traditional outsourcers.” 

The team is updating the outsourcing terms for Microsoft on-premises licenses in order to clarify the difference between on-premise/traditional outsourcing and cloud services. Additionally, they are planning to create more consistent licensing terms across multi-tenant and dedicated hosted cloud services.

The customers will either have to rent the software via SPLA (Service Provider License Agreement) or they will have to purchase a license with software assurance, an annual service charge.

From October 1, on-premises licenses purchased without Software Assurance and mobility rights will no longer be deployed with dedicated hosted cloud services that are offered by the public cloud providers like Microsoft, Alibaba, Amazon (including VMware Cloud on AWS), and Google. According to Microsoft, they will then be referred to as “Listed Providers.”

These changes won’t be applicable to other providers, Services Provider License Agreement (SPLA) program as well as to the License Mobility for Software Assurance benefit except for expanding this benefit to cover dedicated hosted cloud services.

Customers will benefit from licensed Microsoft products on a dedicated cloud platform

Customers will be able to license Microsoft products on dedicated hosted cloud services from the Listed Providers. Users can continue to deploy and use the software under their existing licenses on Listed Providers’ servers that are dedicated to them. But they will noy be able to add workloads under licenses that are acquired on or after October 1, 2019. 

Users will be able to use products through the purchase of cloud services directly from the Listed Provider, after 1st October. In case, they have licenses with Software Assurance, then it can be used with the Listed Providers’ dedicated hosted cloud services under License Mobility or Azure Hybrid Benefit rights.

These changes aren’t applicable to deployment and use of licenses outside of a Listed Provider’s data center. But these changes are applicable to both first and third-party offerings on a dedicated hosted cloud service from a Listed Provider.

To know more about this news, check out the official post by Microsoft.

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