What Is Microsoft SPLA?
- Microsoft SPLA: A licensing program for service providers.
- Purpose: Allows providers to rent Microsoft software.
- Usage: For hosting services and cloud solutions.
- Billing: Based on monthly usage of software.
- Clients: Ideal for businesses offering hosted services.
What Is Microsoft SPLA?
The Microsoft Services Provider License Agreement (SPLA) is a unique and flexible licensing model designed specifically for service providers and independent software vendors (ISVs). SPLA lets providers license Microsoft software monthly, allowing them to deliver hosted software services to their customers.
The goal is to allow service providers to offer Microsoft products as a service, eliminating the need for customers to purchase software licenses upfront. Instead, customers would “rent” access to the software, paying based on actual usage.
In this article, we will examine the details of SPLA, including how it works, its benefits, eligibility requirements, and best practices for managing this licensing agreement effectively.
We will also explore common use cases, applications of SPLA, and compliance considerations that service providers must address to stay in good standing.
Core Concept and Structure of SPLA
At the heart of the SPLA program is the relationship between two key parties:
- Service Provider (Licensee): This organization or individual offers hosted services based on Microsoft products. The service provider is responsible for licensing the products on behalf of their customers.
- End User (Customer): The end user is the customer who consumes the hosted services provided by the service provider. Rather than purchasing Microsoft products outright, they pay for access to the software via the service provider.
Businesses often use The SPLA model by offering cloud services, SaaS (Software as a Service), and IaaS (Infrastructure as a Service). Providers of web hosting, data hosting, and managed IT services commonly utilize SPLA for their business needs.
Key Characteristics of SPLA:
- Monthly Licensing: Service providers pay for Microsoft licenses monthly, based on usage, instead of committing to a large, upfront purchase.
- Pay-As-You-Go Model: Providers report their usage each month and pay accordingly. This model allows providers to scale services up or down based on customer demand.
- Hosted Services: Microsoft products are offered as hosted services, meaning the end user rents the software rather than buying a license.
- No Long-Term Commitments: SPLA’s flexibility allows service providers to avoid large, one-time licensing costs, making it easier for businesses to scale their offerings without upfront financial burdens.
Key Products Covered by SPLA
SPLA encompasses a broad range of Microsoft products, allowing service providers to license and offer some of Microsoft’s most popular software applications and server products as a hosted service.
The key products covered by SPLA include:
- Windows Server: A critical operating system for hosting virtual machines, websites, and databases.
- SQL Server: A database management system that runs applications, websites, and more.
- SharePoint Server: A collaboration platform for managing content and documents used by businesses to create intranet portals and websites.
- Exchange Server: A messaging solution for email, calendaring, and contacts.
- Office Applications: Software such as Word, Excel, PowerPoint, and Outlook, which can be provided on a subscription basis.
- Visual Studio: An integrated development environment (IDE) for software developers, enabling the creation of applications for various platforms.
How SPLA Works
SPLA operates on a pay-as-you-go licensing model, which is ideal for service providers who need the flexibility to adjust their software usage based on customer demand. Its structure is designed to help providers scale their services efficiently while maintaining compliance with Microsoft’s licensing requirements.
Licensing Model
In a typical SPLA arrangement, service providers are responsible for paying Microsoft a monthly fee based on the number of licenses they use. The licenses are reported monthly, and fees are paid accordingly. There is no need for large, upfront purchases, making it easier for businesses to manage costs and scale their operations.
The pay-as-you-go model also means that service providers are only charged for the licenses they use. This benefits companies with fluctuating demands, allowing them to increase or decrease their usage as necessary.
Reporting Requirements
Service providers are required to report their monthly usage of Microsoft products to ensure compliance. This process is crucial for maintaining accurate licensing records and complying with the terms of the SPLA agreement.
Providers must submit the following reports:
- Monthly Usage Reports: These reports detail the number of licenses used during the month. Providers must provide this information for all products covered under the SPLA agreement.
- Zero-Use Reports: A service provider must submit a zero-use report if it does not use any Microsoft products in a given month. This is a necessary step to maintain transparency.
- Customer Information: If a customer’s monthly license fees exceed $1,000, the service provider must submit customer information to Microsoft. This information tracks the customer and ensures the provider accurately reports usage.
Benefits of SPLA
For Service Providers
- Flexibility: The monthly payment structure allows service providers to adjust their licensing needs as demand fluctuates. If the demand for a service increases or decreases, the provider can adjust the number of licenses they need accordingly.
- Access to the Latest Microsoft Software: Providers can always offer their customers the latest versions of Microsoft products, ensuring they can access new features and improvements.
- Global Reach: The SPLA program enables service providers to offer Microsoft products to customers worldwide, making it a suitable option for global operations.
- Channel Development: SPLA allows providers to expand their business through partnerships with resellers and data center providers, building a wider network of service offerings.
For End Users
- Cost-Effective: The pay-as-you-go model makes it easier for end users to access enterprise-level Microsoft software without paying hefty upfront licensing fees.
- Scalability: As a business grows, end users can easily increase or decrease service usage. This makes SPLA a flexible option for businesses of all sizes.
- Technical Support: End users benefit from the support services provided by the service providers, which are required to offer 24/7 support as part of the SPLA agreement.
Eligibility and Requirements for SPLA
An organization must meet certain criteria to qualify for the SPLA program. These include:
- Microsoft Partner Network (MPN): To be eligible for SPLA, the service provider must be a member of the Microsoft Partner Network, which provides access to resources, support, and licensing opportunities.
- Microsoft Hosting Community: Providers must also join Microsoft’s Hosting Community, designed specifically for businesses offering cloud and hosting services.
- Microsoft Business and Services Agreement: Service providers must sign this agreement, which outlines the terms of the SPLA program and sets the legal framework for licensing.
- Work with an Authorized SPLA Reseller: Providers must purchase the licenses from a Microsoft-authorized SPLA reseller. Resellers act as intermediaries, ensuring providers comply with all licensing requirements and pay for the appropriate licenses.
Common Use Cases for SPLA
Service providers use SPLA across a variety of industries. Some common use cases include:
1. Application Hosting
Service providers can host third-party applications on Microsoft infrastructure, making SPLA ideal for hosting solutions like:
- Customer Relationship Management (CRM) solutions
- Messaging services (such as email services)
- Backup and disaster recovery services
2. Infrastructure Services
SPLA is also essential for providers offering infrastructure services. This includes:
- Multi-Tenant Cloud Services: Providers offering cloud hosting solutions for multiple customers on the same infrastructure.
- Website Hosting: Providers offering web hosting services using Microsoft products such as Windows and SQL Server.
- Virtual Private Server (VPS) Hosting: Virtual machines running on Microsoft platforms, offered as a service.
Compliance and Auditing
Microsoft conducts regular audits to ensure compliance with SPLA. These typically occur every 2 to 3 years and help ensure service providers follow the terms of their agreements.
Audit Requirements
During an audit, service providers must:
- Maintain accurate records of their software usage.
- Report the correct number of licenses and ensure that all usage is documented.
- Provide customer information when required.
- Demonstrate that Microsoft software is being deployed according to the licensing terms.
Compliance Considerations
Service providers must:
- Monitor and track authorized user access carefully.
- Ensure that the SPLA agreement deploys licenses.
- Submit accurate monthly reports and maintain detailed documentation to avoid discrepancies during audits.
Pricing Structure
The SPLA pricing structure is based on two main licensing models:
- Subscriber Access License (SAL) Model: This model applies to products licensed per user. Examples include Microsoft Office, Visio, Project, and SQL Server Standard.
- Core-Based Licensing: This model applies to server products like Windows and SQL servers. Licensing is based on the number of processor cores rather than the number of users.
Best Practices for SPLA Management
To successfully manage SPLA, service providers should:
- Track Usage: Set up reliable tracking systems to monitor license usage accurately.
- Maintain Detailed Documentation: Keep records of deployments, usage reports, and customer information.
- Perform Internal Audits: Conduct audits regularly to ensure all licensing complies.
- Communicate with Resellers: Maintain a good relationship with SPLA resellers to ensure smooth transactions and resolve potential issues.
Limitations and Restrictions
While SPLA offers flexibility, there are some restrictions:
- Internal Use Restrictions: Internal use of licenses must not exceed 50% of the total product usage.
- Zero-Use Reports: Providers can only submit zero-use reports during the first six months.
- Minimum Reporting Requirements: Providers must report a minimum of $100 per month in licensing after the initial period.
- No Reselling: SPLA prohibits providers from reselling Microsoft licenses directly to end users. Providers can only offer the software as part of a service.
FAQ: What Is Microsoft SPLA?
What is Microsoft SPLA?
Microsoft SPLA allows service providers to offer Microsoft software through cloud services and hosting on a pay-per-use model.
Who can use SPLA?
Only service providers offer hosted services like cloud, hosting, and software solutions.
What services can be offered under SPLA?
You can offer virtual desktops, web hosting, and cloud-based applications.
How does SPLA billing work?
Billing is based on customers’ actual usage of Microsoft software each month.
Is SPLA suitable for small businesses?
Yes, it allows service providers of any size to use Microsoft software.
What types of Microsoft products can be licensed through SPLA?
Products include Windows Server, Office 365, SQL Server, and more.
How is SPLA different from other Microsoft licensing models?
Unlike traditional licenses, SPLA offers a subscription-based model with pay-per-use flexibility.
Can SPLA licenses be transferred between customers?
No, SPLA licenses are tied to the specific customer and usage.
What is the duration of a SPLA agreement?
SPLA agreements are typically renewed monthly, based on usage.
What does SPLA cover in terms of Microsoft software?
It includes server software, cloud solutions, and applications but not on-premise software for internal use.
Can I license Microsoft software through SPLA for internal use?
No, SPLA is strictly for offering software as a service to external customers.
Do I need a Microsoft partnership to use SPLA?
Yes, a Microsoft Partner Agreement is required to sign a SPLA agreement.
Are there any volume discounts for SPLA?
Yes, pricing may vary based on the number of users and usage.
How do I track usage under SPLA?
Usage is tracked via reporting tools provided by Microsoft to monitor and manage customer consumption.
Can I license Microsoft software for resale through SPLA?
No, SPLA is for offering software as a service, not for resale.
