Back to the basics with Microsoft software licensing options

My colleagues and I get asked a lot about licensing. Frankly, Microsoft doesn’t have a great reputation for keeping it simple. And to be totally transparent – I, like many of my colleagues, would usually rather stick a fork in my eye that talk about it because it can get complicated. And confusing. And just…ugh.

So you can imagine my joy when I was asked to write a newsletter editorial about simplifying licensing. Exactly.

Then I had a very enlightening conversation with Terry Choquette, Licensing Marketing Manager at Microsoft and she pointed me to a few resources that got back to the basics and laid it all out very simply. I like simple. And I decided that this simple information was as blog worthy as it was newsletter worthy. While details about software licensing is not everybody’s favourite reading material, stick with me on this.

Ways to buy a license

First of all, there are 3 ways to buy a license as illustrated in the slide below: a full packaged product from a retail store, an OEM product on a new computer or a volume agreement from a reseller.

Ways to buy a license

Volume licensing agreements

While you could simply walk into the nearest Best Buy or Future Shop and make your purchase, most organizations that need 5 or more licenses can benefit best from volume licensing agreements. Why? Well, there are some pricing advantages, there are more flexible options based on size and type of business, payment structure, ownership of software, etc., there are additional use rights for cross-language and reimaging machines, and there are use rights to new product versions, support, training, tools, etc., with Software Assurance (more about this below). 

For this post, I’m going to limit my discourse to those organizations who want to license less than 250 devices or users, which I would hazard a guess applies to most of you reading this blog. If you need help with licensing options for 250 devices/users or more, lemme know and I’ll put you in touch with people who can help you or you can check out these online resources.

Below is a great 3.5 minute video that lays out the volume licensing options that are part of the Microsoft Open License program for small and medium sized businesses:



Basically, there are 3 volume licensing agreement options: Open License, Open Value and Open Value Subscription. Now if you want more detail than the video gives (you did watch it right? C’mon it’s only 3.5 minutes long and it’s pretty entertaining!), you’ll want to take a look at the Open License Program Guide. It has a very useful chart on page 8 which compares what you get with an Open License agreement compared to an Open Value agreement.

Software Assurance

Software Assurance is something that can be added to your volume license agreement which provides 24x7 support, deployment planning services, training, and the latest software releases. Although once viewed as simply an insurance policy for free software upgrades, Software Assurance has now been recognized by analysts as an essential tool for getting the most out of your licensing purchase.

Below is a screen shot from an interactive PDF listing the benefits of Software Assurance with each type of licensing agreement.

benefits of software assurance

For more information about Software Assurance and what it can do for your organization, check out the Software Assurance site.

Let me know if this was helpful!

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Comments (8)
  1. Anon says:

    Could you explain the options available for project managers and business analysts to get involved in work item creation and issue tracking through Team System?

    I read that Microsoft was providing free access through TFS web access.  But after reading the fine print, it looks like they may only view items that have been created or assigned to themself.  This makes it pretty much useless as they will create duplicate items, and have no concept of the general progress of the project.  It seems like a bait-and-switch to me.  Purchasing licenses for all our PMs, BAs, and UAT testers will add up quickly.  It will severely limit adoption of TFS in our organization.

    PS: It also seems strange that by default the PMs and BAs get full TFS web access, and the TFS has to remember to put them into a restrictive role in order to bring them into license compliance.  Normally you start off restricted, and get added to a more liberal role once your licensing is confirmed.

  2. John Doe says:

    Your colleagues would rather stick a fork in your eye?  Wow, thats cold.

  3. Adam Gallant (, Developer Specialist says:

    Hi Anon,

    TFS has a client license access requirement for all users. With that license, a user can use all of the capabilities that TFS offers, using any method they wish (for example, from Project Pro, Excel, TFS Web Access, the Team Project Portal, Team Explorer, etc). They use their normal licensing to gain access to the office front ends, or can download and use Team Explorer for free, or work through their browser.

    In the case of a developer, normally they get this client access license (CAL) included with their Visual Studio with MSDN license, so no need for a CAL.

    There is one exception to the need for the CAL, as you pointed out. That is for creating your own work items. This is mainly to support things like bug submissions, requirements submissions, etc. That was the intent of the license exception.

    Hope this clarifies it for you… if you have any additional questions regarding the tooling and licensing, please reach out to us.

  4. Ruth Morton says:

    John Doe –

    Ha – I had to go back and re-read my sentence! Yeah that would be harsh. I suppose I could have worded that better. At least, I don't think any of my colleagues want to stick a fork in my eye…

  5. Rajiv says:

    Wow! that was nice and simple.

  6. bob h says:

    great blog but lacking details such as price tiers etc

    i read text only while on the road so could not watch the video

  7. alex says:

    I concur with Bob H.  Blog is incomplete without pricing details.  I find this to be an ongoing issue with Microsoft.  They're very truculent about telling you how much it's going to cost.  I realize Microsoft offers a lot of different software, but how about a simple example using Office Professional?

  8. Ruth Morton says:

    Bob H and Alex – The problem with pricing is that it's so dependant on the product and of course there are always changes to pricing. I'll speak to some folks that are more familiar with our pricing than I am and see if I can come up with something.

    Your feedback is appreciated!


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