Microsoft makes licence migration to clouds more expensive

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Microsoft makes licence migration to clouds more expensive

Microsoft has changed the way it licences software to make it much harder to move on-premises usage rights to rival hyper-scale clouds, sparking a war of words over whether the company is reducing choice for customers and channel alike.

Microsoft announced the changes to its Bring Your Own License Policy on 1 August, claiming the advent of dedicated, single-tenant servers offered by major cloud providers "has blurred the line between traditional outsourcing and cloud services and has led to the use of on-premises licenses on cloud services."

The policy of transferring licenses from corporate data centres to hosting providers wasn't intended to apply to clouds, but, as cloud giants have introduced dedicated options, that's in effect what has happened.

Those dedicated services, according to Microsoft, have all the hallmarks of multi-tenant ones: elastic scaling, on-demand provisioning, pay-as-you-go billing. For that reason, the change was needed to impose "more consistent licensing terms across multitenant and dedicated hosted cloud services," the Microsoft announcement said.

The change means that on-prem licenses purchased from Microsoft after 1 October, with some nuanced exceptions, won't be transferable to a select group of cloud providers: Alibaba; Amazon (including VMware Cloud on AWS); Google; and Microsoft itself, which introduced in preview its own single-tenant service, Azure Dedicated Host, the same day as it revealed the policy change.

Gartner VP analyst Michael Warrilow, who specialises in software infrastructure, told CRN the changes represent a sweetener for Microsoft-centric users contemplating a cloud move. Those contemplating moving their Microsoft workloads to other clouds don't have the same incentives.

Microsoft's new licensing model. Click to enlarge

The change irked rival cloud operators.

Google Cloud President Rob Enslin on Wednesday afternoon tweeted: "Shelf-ware. Complex pricing. And now vendor lock-in" in response to an article on the licensing change. "Microsoft is taking its greatest hits from the '90s to the cloud."

Amazon CTO Werner Vogels on Monday described the move on Twitter as a bait-and-switch, going on to say it's "hard to trust a co. who raises prices, eliminates benefits, + restricts freedom of choice."

Vogels referenced previous policy changes "to force MS use" such as undoing the Bring Your Own License option for SQL server running on Amazon's managed RDS service and Windows upgrades on Amazon instances.

Sandy Carter, an Amazon Web Services vice president, elaborated on Vogel's theme in a blog posted on LinkedIn, a Microsoft property, that argued Microsoft's goal was "to try to awkwardly force you into Azure."

Carter, in her LinkedIn blog, took aim at the change in licensing benefits as a means of forcing lock-in and limiting choice.

"Microsoft is looking to restrict what computer you can use. And what cloud," Carter said. That move certainly seems "like they’ve been taken from the old guard software vendor playbook."

Carter went on to elaborate on the success Amazon has had in winning Microsoft workloads.

"AWS is the best cloud for running your Windows workloads and our experience running Windows applications has earned our customers’ trust," Carter wrote.

Carter noted that more than a decade ago—before Azure existed—Amazon made it possible to run Windows on its cloud. She then referenced an IDC study that concluded AWS hosts almost twice as many Windows server instances than Microsoft Azure.

"This isn’t the first time Microsoft has made "subtle" changes to its licensing that are slowly chipping away at your options," Carter said, noting last year Microsoft removed the option of transferring SQL Server licenses for use with the Amazon Relational Database Service (RDS).

That single-tenant option will enable more highly regulated entities to take full advantage of the scalability and flexibility of cloud while maintaining high data isolation controls necessary for sensitive workloads and protecting from the "noisy neighbour" challenge in commercial cloud services.

MIcrosoft has also introduced its own dedicated hosts, further complicating the situation!

This article originally appeared at Australian reporting by Simon Sharwood.

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