Microsoft licensing for cloud migration.

Moving Windows Server and SQL Server to a hyperscale cloud changes the licensing math at every step, and the rules differ sharply across Azure, AWS, and Google Cloud.

How does Microsoft licensing change when you migrate to the cloud?

The short answer is that ownership stays with you, but your right to deploy a license on a third party cloud is restricted. Microsoft splits clouds into two groups. Its own Azure platform is one. Amazon, Google, Alibaba, and Microsoft are jointly defined as Listed Providers.

For Listed Providers, the flexible outsourcing rights Microsoft introduced in October 2022 do not apply. That detail is what most cloud business cases miss. The controlling document is the Microsoft Product Terms, not the account team slide.

• Windows Server: governed by the outsourcing rules. New licenses without prior rights need a dedicated host on a Listed Provider.
• SQL Server: portable under License Mobility through Software Assurance to most clouds, including AWS and GCP.
• Microsoft 365 and Office 365: SaaS subscriptions, unaffected by the underlying compute cloud.

Which products move under License Mobility?

License Mobility through Software Assurance covers server applications, not the operating system. The benefit is documented on the Microsoft License Mobility page.

• SQL Server, SharePoint Server, and Exchange Server qualify.
• Skype for Business, Project Server, and BizTalk Server qualify.
• Windows Server and Windows desktop do not qualify and follow the outsourcing rules instead.

What does Software Assurance actually buy you here?

Active Software Assurance is the gate. Without it, neither Azure Hybrid Benefit nor License Mobility is available. Software Assurance also grants a concurrency window, so you can run on prem and in the cloud during cutover without buying twice.

What is Azure Hybrid Benefit actually worth?

Azure Hybrid Benefit applies Windows Server and SQL Server licenses with Software Assurance against Azure compute, so you pay the base compute rate rather than the license inclusive rate. Microsoft publishes the mechanics on the Azure Hybrid Benefit page.

How do you stack the benefit with reservations?

The savings combine. Apply Azure Hybrid Benefit first, then a one or three year reservation or savings plan on the discounted base rate. A stable SQL Server estate frequently lands 60 to 70 percent below the pay as you go rate once both are applied.

• Step one: confirm Software Assurance is active and counted.
• Step two: switch Azure Hybrid Benefit on for every eligible virtual machine.
• Step three: reserve or commit the stable baseline.

How do the AWS and Google Cloud rules differ from Azure?

On AWS and Google Cloud you have two paths. Bring your own license on a dedicated host, or buy license included capacity where the vendor folds the Windows or SQL cost into the hourly rate. AWS documents both routes on its Windows licensing FAQ.

When is license included the right call?

License included removes the compliance burden and suits bursty or short lived workloads. The trade is a Windows premium that typically runs 30 to 40 percent above the Linux rate. For steady state production, bring your own license on Azure under Hybrid Benefit is usually cheaper.

• License included: simple, no dedicated host, higher per hour cost.
• Bring your own license: cheaper at scale, needs a dedicated host and active Software Assurance.
• Mixed estate: map each workload to the cheapest compliant path, not one blanket policy.

What about Google Cloud specifically?

Google Cloud sits under the same Listed Provider rules as AWS for Windows Server. Sole tenant nodes are the dedicated host equivalent. License Mobility for SQL Server applies, so the SQL path resembles AWS while the Windows path carries the dedicated capacity requirement.

Where the common advice on cloud migration licensing is wrong

The standard integrator pitch is that you simply bring your Microsoft licenses to whichever cloud wins the compute bake off, and the licensing follows for free. We disagree. In roughly 6 of 10 migration business cases we reviewed, Windows Server was assumed portable to AWS at no cost, which ignored the dedicated host requirement and understated the bill by 15 to 30 percent. The buyer side move is to model licensing per workload before the platform decision, not after. Pick the cloud on total cost including the dedicated host and any lost Hybrid Benefit, not on raw compute price alone.

The migration model put twenty two of forty workloads on Azure under Hybrid Benefit, twelve on AWS license included, and six on prem. The blended cost ran thirty eight percent below the original AWS only proposal.

Director, Cloud Platform · North American financial services group

What to do next

1. Inventory every Windows Server and SQL Server license and confirm Software Assurance status against the Product Terms.
2. Map each workload to a target cloud and the cheapest compliant licensing path for that cloud.
3. Switch Azure Hybrid Benefit on for every eligible virtual machine you already run in Azure.
4. Right size SQL Server editions before migration, moving Enterprise workloads to Standard where the feature set allows.
5. Model the dedicated host cost explicitly for any AWS or GCP bring your own license plan.
6. Reserve or commit the stable baseline after the benefit is applied, not before.
7. Document the concurrency window so you do not pay twice during cutover.

Frequently asked questions

Can I run Windows Server on AWS with my own license?

It depends on the license vintage and your Software Assurance status. New Windows Server licenses generally require an AWS Dedicated Host because Amazon is a Listed Provider. The Microsoft Product Terms control, so confirm your rights before any AWS commitment.

What is Azure Hybrid Benefit worth in real money?

Azure Hybrid Benefit cuts the Azure cost by 30 to 45 percent for Windows Server and up to 77 percent for SQL Server Enterprise. The savings stack with reservations and savings plans, so a stable SQL estate often lands 60 to 70 percent below the pay as you go rate.

Does License Mobility apply to Windows Server?

No. License Mobility through Software Assurance covers SQL Server, SharePoint, Exchange, and a defined set of server applications. Windows Server follows the outsourcing rules in the Product Terms instead, with the dedicated host requirement on AWS and GCP for new licenses.

Can I move Microsoft 365 between clouds?

Yes, with no licensing change. Microsoft 365 and Office 365 are software as a service and do not depend on the underlying compute cloud. Users licensed for the service reach the Microsoft cloud regardless of where the rest of the infrastructure runs.

Should I buy license included on AWS or bring my own license?

It depends on workload stability and Software Assurance status. License included removes compliance work but adds a Windows premium of roughly 30 to 40 percent. Bring your own license on Azure under Hybrid Benefit is usually cheapest for steady production workloads.

Do the October 2022 outsourcing changes help on AWS?

Not for AWS, Google, Alibaba, or Microsoft. Those four are defined as Listed Providers and are carved out of the flexible outsourcing rights. The dedicated host requirement still applies to qualifying licenses on those clouds.

How long is the Software Assurance concurrency window?

Software Assurance grants a concurrency right that lets you run on prem and in the cloud during migration without buying licenses twice. Confirm the exact window in your Product Terms, as it is tied to the active Software Assurance benefit.

How does Redress engage on Microsoft cloud migration?

Redress runs the license inventory, the Software Assurance confirmation, the workload by cloud mapping, the Hybrid Benefit analysis, and the dedicated host model. Engagements run as a focused six week sprint or inside the wider Microsoft program, always buyer side and never Microsoft paid.