Master Windows Server core licensing mechanics first
Windows Server Licensing Guide →Volume Licensing Programmes (EA & Open Value)
The flagship volume licensing programme for large organisations (generally 500+ users/devices). Companies sign a 3-year agreement and typically commit to certain products organisation-wide. Windows Server is acquired through a Server and Cloud Enrolment (SCE) or as an additional product.
For small-to-mid-sized organisations that don't meet EA thresholds. The traditional Open Licence programme (transactional, minimum 5 licences) was retired in January 2022 — Microsoft now directs those customers to CSP. Open Value remains available as a 3-year programme for organisations with as few as 5 PCs.
Virtualisation & container licensing for Windows Server
Virtualisation Guide →Cloud Solution Provider (CSP) Programme
A modern licensing channel where organisations buy licences (cloud subscriptions and on-prem software) on a subscription basis through a Microsoft partner. CSP has become the go-to for needs previously served by Open Licence. For Windows Server, CSP offers Standard and Datacenter subscription licences, typically as 1-year subscriptions.
CSP subscriptions vs perpetual: If you subscribe for 3 years via CSP and then stop, you generally lose the right to run the software. With EA, even without renewal, you keep perpetual use of the last acquired licences (losing only upgrade/SA rights). If long-term ownership matters, either purchase perpetual licences through CSP or consider volume licensing.
Service Provider Licensing (SPLA)
A specialised programme for service providers that host software for third parties. If your organisation offers hosting, SaaS, or managed services on Windows Server to external customers, you generally cannot use standard licences — you must use SPLA. The provider licences Microsoft software on a monthly rental basis.
For CIOs moving workloads to a third-party datacentre or cloud (not Azure), clarify how Windows Server is being licensed: either rely on the provider's SPLA (you just pay a service fee) or provide your own licences (which requires SA/subscription and compliance with Microsoft's outsourcing terms). Many traditional outsourcing contracts bake SPLA costs into their fees — convenient but sometimes pricier than using your own licences if you already own them.
OEM & Retail Licensing
OEM Windows Server licences are sold with hardware — when you buy a server from Dell, HPE, Lenovo, etc., Windows Server can be pre-installed with an OEM licence.
Buying Windows Server as a retail box or download. Usually the most expensive way per licence, intended for very low quantities (one-off purchases). Retail licences are transferable between machines (more like volume). Enterprises rarely use retail copies — it may make sense only for a single-server scenario in a pinch.
OEM vs Volume — the critical difference: OEM is cheaper per licence but tied to hardware with no built-in upgrade rights. Volume (and CSP) is transferable after 90 days, and if SA/subscription is included, you get upgrades and cloud benefits. Volume also provides downgrade rights (install an older version with a new licence), whereas OEM typically restricts you to the purchased version. For dynamic virtualised environments, volume licensing pairs far better with VM mobility and hardware refresh cycles.
Comparing Programmes — Summary Table
| Programme | Licence Type | Transferable? | Term | Includes SA? | Ideal For |
|---|---|---|---|---|---|
| Enterprise Agreement (EA) | Perpetual (volume) | Yes (after 90 days) | 3-year agreement (perpetual rights) | Yes — SA typically included | Large enterprises (≥500 users) needing broad coverage, best pricing, and SA benefits |
| Open Value / Open Licence | Perpetual (volume) or Subscription (OVS) | Yes (90-day transfer) | Open Value: 3-year; Open Licence: one-time | Optional — OV can include SA; Open Licence requires separate add-on | SMB & mid-market (5+ devices) wanting volume benefits without EA commitment |
| CSP (Cloud Solution Provider) | Subscription or Perpetual (via CSP) | Subscription: reassignable but not perpetual; Perpetual: 90-day transfer | Flexible (monthly/annual subscription; or immediate for perpetual) | Subscription includes SA-equivalent rights; Perpetual via CSP ± SA | Mid-sized orgs preferring OPEX, flexibility via partner; Open Licence replacement |
| SPLA (for hosters) | Usage-based rental | N/A — monthly reporting, no transfer concept | Monthly (pay as you go) | N/A — latest version use is inherent | Service providers hosting Windows Server for third-party customers |
| OEM (with hardware) | Perpetual (OEM) | No — tied to original hardware | One-time (lives and dies with hardware) | No — but SA can sometimes be added within 90 days | Small deployments where cost is critical and hardware won't be repurposed |
| Retail (FPP) | Perpetual (Retail) | Yes — transferable | One-time | No — SA can be purchased separately within 90 days | One-off purchases; rarely used by organisations if volume/OEM available |
Note: All programmes except SPLA and certain CSP scenarios still require CALs for users/devices. In SPLA, the service provider covers user access via inclusive rights (no separate CAL purchase by the customer). In volume and OEM, the customer must ensure CALs are acquired.
Recommendations
Match Programme to Organisation Size & Needs
Enterprise with a wide Microsoft footprint? An EA or SCE yields the best pricing, manageability, and includes SA. Mid-sized organisations should evaluate CSP vs Open Value — CSP for flexibility and cloud alignment; Open Value (with SA) for straightforward on-prem ownership with upgrade rights. There's no one-size-fits-all.
Consider Licence Lifetime: CapEx vs OpEx
Do you prefer licences as a capital investment (perpetual) or operational expense (subscription)? Perpetual (EA, Open, OEM) costs more upfront but you retain usage rights indefinitely. Subscriptions (CSP, OVS) lower initial costs and include upgrades, but you must renew to continue. Many CIOs choose a mix: perpetual for core long-running infrastructure, subscriptions for transient or rapidly evolving needs.
Beware of OEM Limitations
If purchasing servers with OEM Windows Server to save cost, plan for the future. Once hardware is retired, the OEM licence cannot be moved — you'll need new licences for replacement hardware. For dynamic virtualised environments, volume licences (with their reassignment ability) pair far better with VM mobility and hardware refresh cycles. OEM may be fine for fixed-purpose appliances or edge servers that won't change.
Leverage Software Assurance / Subscription Benefits
Programmes that include SA or equivalent (EA, Open Value with SA, CSP subscriptions) unlock Azure Hybrid Benefit, new version rights, and licence mobility. For any hybrid cloud plans — using Azure or an authorised hoster — ensure your licences are acquired through a programme granting those privileges. OEM without SA won't qualify.
SPLA vs BYOL for Hosted Workloads
If engaging a third party to host your Windows workloads, discuss whether using their SPLA or bringing your own licences is more cost-effective. SPLA simplifies compliance (the provider handles it) and covers external access without CALs, but may incur higher long-term costs. BYOL can save money if you already own Datacenter licences with SA — but ensure the provider is an Authorised Outsourcer and that you remain compliant with CALs.
Consult Independent Experts
The variety of programmes can be overwhelming. Engaging a licensing consultancy such as Redress Compliance provides neutral analysis of your Microsoft contracts — identifying if you're under the optimal programme or if cost savings could be found by switching (e.g., enterprises downsizing from EA to CSP, or consolidating many OEM licences into a volume agreement). Independent experts also track programme changes (CSP and hosted rights policies 2022–2025) that could benefit your strategy.
The optimal licensing programme is rarely a single channel — most organisations benefit from a deliberate mix, matching each workload's stability, scale, and strategic importance to the programme that delivers the best balance of cost, flexibility, and compliance protection.
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