Microsoft eliminates traditional ‘Outsourcing’ rights for Major Cloud competitors
In a bold move Microsoft has eliminated the right to leverage on-premise licensing in hosted, Dedicated environments . . . but just for who they refer to as ‘Listed Providers’. Those providers are identified as Microsoft, Alibaba, AWS and Google. Of course, AHUB or Azure Hybrid Use Benefits still allow customers to leverage on-premise licensing on Azure, so while Microsoft has included themselves in the group of cloud providers who lose the right to leverage on-premise licensing, AHUB gives them a distinct advantage.
Here’s the official announcement: https://www.microsoft.com/en-us/licensing/news/updated-licensing-rights-for-dedicated-cloud
Of interest is why IBM wasn’t also included in the Listed Providers, given the popularity of dedicated instances on IBM Cloud (formally Bluemix or SoftLayer). It will be interesting to see if they expand the list in the future and include more traditional hosting companies.
Perhaps Microsoft doesn’t see the same blurred line with IBM as they see with the others:
Dedicated hosted cloud services by major public cloud providers typically offer global elastic scale, on demand provisioning and a pay-as-you-go model, similar to multitenant cloud services.
I’m not sure I understand this statement but that’s their justification for this change. In this statement they are saying dedicated cloud services actually leverage many multitenant attributes, so we now categorize it that way. In reality, they are waxing philosophical of what is really just an aggressive business decision.
While this change won’t impact on-premise licensing purchased prior to October 1, 2019, it’s going to create turmoil. Microsoft can now target customers on competitive cloud platforms, where they know exactly when their Microsoft agreement renewal dates are. Those customers would have to either license through vehicles like SPLA, move to Azure or move to another provider and hope that provider doesn’t end up on ‘The List’.
If you are impacted by this change, email us or use the link below to make an appointment and we’d be happy to discuss your options going forward.
From your Microsoft Licensing Experts at Altaris Cloud