Deploying the wrong product edition

• • Problem: Customers often purchase a specific edition of a product, but unintentionally install another edition, which can create a costly licensing gap. 
  • Example: A customer purchased Visio Standard, but unwittingly installed Visio Professional in their environment.  Audit findings resulted in a settlement demand, including penalties, for $300,000.
  • Clarify Recommendation: Periodically generate a baseline and check deployments against entitlements. If you find gaps, optimize them internally.

Moving to public Cloud without understanding software licensing rules and the nature of Cloud (IaaS or PaaS).

• • Problem: Customer migrated to public IaaS Cloud without understanding the relevant terms and conditions pertaining to their Cloud/Hybrid software usage rights.
  • Example: The application team installed numerous copies of SQL Server Enterprise edition and Biztalk Server on IAAS servers in the public Cloud.  They assumed that license was included in the monthly cloud subscription whereas, in fact, the licensing was the customer’s responsibility based on BYOL license. This was discovered during an audit, and the customer had to True-up for the additional licenses. This drastically skewed their business plan to reduce costs via migration to the Cloud.   
  • Clarify Recommendation: Ensure your application team has a clear understanding of your Cloud software licensing rules, as well as terms & conditions negotiated by purchasing and legal based on the business case. It is common to have an external third party company help identify and coordinate the relevant information and confirm the migration.

Not truing up for the “new normal” work-from-home (WFH) licensing requirements

• • Problem: Many customers are not familiar with the impact on licensing when they move from working in the office to WFH due to covid. 
  • Example: Because of the pandemic, a customer had to scale up their WFH set-ups drastically. In prior years, only 20% of employees worked from home, but in March the entire company suddenly started working from home. To achieve business goals, the customer had to deploy newer versions of commonly-used software, e.g., Visio, Project, MSI-based Office in Citrix to a larger number of users who had traditionally used it on their company desktop. These products were not on Software Assurance, which also increased their Remote Desktop Services (RDS) Client Access License (CAL) usage exponentially.
  • Clarify Recommendation: Perform a software licensing baseline to understand the impact of the newly scaled WFH set-ups with regard to Microsoft licensing. Based on results, restructure or optimize your deployments or architecture. 

You get charged for software based on installation, not usage  

• • Problem: Microsoft counts anything that is installed as being licensable, so if you have products installed on any rogue or unused servers, you will be charged for the associated licenses.  
  • Example: A customer had installed SQL Server Enterprise as part of their server base image based on the misconception they would not need to pay for it where it wasn’t being used. All installations were discovered as part of a software licensing audit, and the customer had to pay $3 million to settle.  
  • Clarify Recommendation: Understand Microsoft licensing rules, including the fine print.  These are sometimes inconsistent with typical installations, so they need to be communicated to your application/operations teams. Perform a proactive Microsoft licensing assessment to discover and remediate compliance issues.

Paid components may require licensing

• • Problem: For specific software products, some components of the product are fee-based and require a license.
  • Example: A client found out during an audit they had installed SQL Server Integration Services on a standalone SQL server. He thought Integration Services component was bundled and included as a free component with SQL Server even when installed in a stand alone manner, but it was licensable, and they had to True-up for the software.
  • Clarify Recommendation: Assess and ensure compliance with all licensing terms and conditions for software products owned and deployed prior to an audit.

You can certainly undertake the above tasks in-house. However, given the on-going nature of changes and the nuances involved in many areas, you might consider hiring a consultant to help you identify these cost savings opportunities.  

If you have already received a software compliance review letter, any of the above items are likely to come up in audit findings and may result in costly unbudgeted settlement demands that include penalties. 

Contact us at to identify and address these issues proactively.