Microsoft slammed over changes to cloud licensing

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Senior executives from AWS and Google Cloud have hit out at Microsoft for changing how it charges customers using its software on other public clouds.

Some are even accusing Microsoft of trying to lock customers into a single vendor with a complex pricing structure.

From 1 October, Microsoft customers will have to pay additional fees if they want to run its software on AWS, Google or Alibaba cloud environments due to a change to its on-prem licences.

AWS CTO Werner Vogels took to Twitter to slam the change, saying: "Yet another bait+switch by $MSFT, eliminating license benefits to force MS use. 1st, MS took away BYOL SQL Server on RDS, now no Windows upgrades w/BYOL on#AWS. Hard to trust a co. who raises prices, eliminates benefits, + restricts freedom of choice."

Google Cloud's president, Robert Enslin, posted a tweet that suggested Microsoft was harking back to its old ways.

"Shelf-ware. Complex pricing. And now vendor lock-in. Microsoft is taking its greatest hits from the '90s to the cloud," he wrote.

AWS VP Sandy Carter said in a post that Microsoft was 'awkwardly' trying to force customers into Azure with the license change.

Carter said that Microsoft seemed to be taking from the "old guard software vendor playbook". Firstly, by trying to put an end to Bring Your Own License (BYOL) for Windows Server purchased after October 1, 2019. She said that it would restrict customers ability to bring their own purchased licenses to their preferred cloud when using licenses purchased after the change comes into force.

She also accused Microsoft of trying to limit choice around SQL Server.

"If you are running SQL Server on the AWS cloud with Dedicated Host without software Assurance (SA) (which is allowed today) and want to upgrade to a newer version after October 1, you would be required to purchase a new SQL Server license with SA," she explained.

Until now, Microsoft customers were allowed to use the same licence if they wanted to move a workload from an on-premise environment to a single-tenanted public cloud server.

"The emergence of dedicated hosted cloud services has blurred the line between traditional outsourcing and cloud services and has led to the use of on-premise licences on cloud services," it said in a blog.

"As a result, we're updating the outsourcing terms for Microsoft on-premise licences to clarify the distinction between on-premise/traditional outsourcing and cloud services and create more consistent licensing terms across multi-tenant and dedicated hosted cloud services."

Customers now wanting to run Microsoft software on single-tenant cloud servers of AWS, Alibaba, Microsoft and Google will have to pay additional fees on top of the standard licensing.

Alastair Pooley, CIO at Snow Software, argues that the changes will almost certainly bring added complexity for customers.

"Microsoft's recent change to licensing rules impacts the ability to "bring your own license" to dedicated cloud environments. If you are using the more common shared compute instances this will not affect you. Higher security or performance needs have led some companies to choose to be the only tenant on a physical machine and for those customers this will likely increase their costs and add complexity to their Microsoft licensing.

IT Pro has contacted Microsoft for comment

Bobby Hellard

Bobby Hellard is ITPro's Reviews Editor and has worked on CloudPro and ChannelPro since 2018. In his time at ITPro, Bobby has covered stories for all the major technology companies, such as Apple, Microsoft, Amazon and Facebook, and regularly attends industry-leading events such as AWS Re:Invent and Google Cloud Next.

Bobby mainly covers hardware reviews, but you will also recognize him as the face of many of our video reviews of laptops and smartphones.