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Category Archives: In My Opinion

What Would I Do?

I get asked for advice on licensing and the different ways to go to market if I had my own hosted offering.  Knowing what I know now, I put together a small list of things that I would strongly consider if I signed a SPLA.

  • Understand that I signed a contractual agreement with one of the largest companies in the world.  It’s amazing how many service provider’s do not read the SPLA agreement.  I’ve seen SPLA contracts signed five minutes after sending to the customer.  I always chuckle because I know they didn’t bother to read it.  Don’t let the fact that there’s no upfront licensing cost fool you into thinking there’s no reason to read the contract.  Even if you did read the SPLA agreement thoroughly when you signed it, when was the last time you reviewed it?  There are things in there that are very important.  For example, the start date of your agreement dictates how you can license certain products.  Did you know that when you sign a SPLA, you are bound by the SPUR available at the time of signing?  Did you know your contract is in no way with your reseller, but with Microsoft?
  • Speaking of reseller, I would look long and hard at the company you report and purchase licenses through. Too many times I hear providers say they report because they purchased from them before.  Whatever you purchased before is no sign into how well they know SPLA.  I would want to work with a reseller that knows the licenses as well as the industry.  This would ultimately save me headaches and save me money.
  • Report usage on time. Again, going back to the SPLA agreement, it states “usage is due by the 10th” If I was a hosting company that reported late, guess who the vendor is going to look at first in terms of compliance?
  • I would try to avoid standard SAL licenses if possible.  How much time do you spend tracking users?  I would promote license mobility in all my accounts.  I would strongly promote RDS license mobility.  If my customers won’t purchase licenses with Software Assurance, I would find another customer.  I want to put the compliance risk on my customer, not me.
  • If I received an audit notification I would ask for advice from the guy looking back in the mirror.  Three reasons why – I am free, I’ve seen audits and the mistakes SPLA customer make, and I know the program extremely well.  Arrogant?  Maybe. Smart move on your part? Absolutely. info@splalicensing.com
  • Although I would try to avoid standard SAL licenses, I would promote SAL for SA with a vengeance.  Don’t know SAL for SA?  Reread point number two.
  • I would work with Microsoft not against.  Why work against a company with the biggest marketing engine on the planet?  How can Microsoft help my business?
  • I would consider Hyper V.  I know, drinking the Kool Aid a bit here right?  Hook up the hose, I’m going all in!  (bad joke) There are products under SPLA that can save you a significant amount of licensing costs if you move to Hyper V.  I bet if the project was large enough, Microsoft would consider promoting.
  • I would work with a guy named SPLA Man.  If he’s spending his free time writing about this stuff (there’s obviously some mental issues going on) he apparently knows it pretty well. If you emailed me in the past, how long did it take for me to respond?  How long did it take your reseller to respond to the same question?

Thanks for reading,

SPLA Man –

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Posted by on February 21, 2015 in In My Opinion

 

Happy New Year! SPLA Predictions 2015

Happy New Year everyone!  Here’s to a healthy, happy, and prosperous 2015.  Thank you for reading my blog, it’s been a fun ride.

As we know, the world of SPLA is ever-changing.  Here’s a list of 5 SPLA predictions for 2015.  I will book this post, and see where we are at in 2016.

1.  IaaS providers will continue to flourish as customer’s and hoster’s have a better understanding of license mobility and the ways it can lower licensing costs.  Companies will leverage the Azure and Amazon momentum to offer their own unique offerings.

2. Compliance will be front and center.  Surprise!  Companies that are hosting but don’t know they are hosting will be the most impacted.

3. “Cloud Sprawl” will be the new term used by IT consultants and managed service providers.  As the cloud industry expands, there will be a push to consolidate vendors.

4. There will be new terms for hosting VDI. I don’t know what that means from a licensing perspective, but I can see Microsoft making a change in the ways VDI can be deployed for third-party hosters.  Perhaps good news in the works?  Again, just guessing here.

5. Like VDI, I can see a change in the way Office can be deployed.  In my opinion, too many ISV’s use Office as part of their application, it would make sense to make this more economical to host it.

What do you think will happen in 2015?  Will hosting expand, retract or stay the same?  Will VDI and Office use rights change?  Time will tell.

Thanks for reading,

SPLA Man

 
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Posted by on January 2, 2015 in In My Opinion

 

How I saved a company over $100K a year in reporting

Sounds pretty good doesn’t it?  This is a story about knowing what you are reporting and the reasoning behind it. Windows 2012 was launched a couple of years ago (give or take).  At that time there were several service providers reporting Windows Enterprise.  Their customers had applications that needed the functionality of Windows Enterprise, and since it wasn’t virtualized, Windows Datacenter was not an option. The service provider continued to report/license Windows Enterprise after the launch of 2012.  There’s nothing wrong with this, in fact, the terms of the SPLA agreement state you can continue licensing 2008 use rights up until your agreement expires.  What most providers don’t know is you can do the opposite.  You can run 2008 versions but report 2012.  Why would they do that?

In this case, they had Windows Enterprise installed; but since Windows Enterprise was discontinued with the release of 2012, they could downgrade to Windows Standard edition. Sounds funny doesn’t it?  DOWNGRADE to Windows Standard from Enterprise?  Yes, I said that correct.  Enterprise is discontinued. Again, nothing was virtual, and that is very important. If it was virtual, they would continue to report Enterprise up until the agreement expired and report Windows Datacenter moving forward.   Not only did he save on their monthly usage report, I’m guessing he had added margin since he was already contracted with his customer.

Quick note – not all products discontinued have the same outcome.  In most cases (such as SQL 2012 switch to cores) their costs actually went up

Ahh…but where is this written in the SPUR?  I’ll save you time, it’s not.  That’s why you need to read “Why Timing is Everything” You are bound by the SPUR (i.e.products/versions/use rights) available at the time of signing your SPLA agreement.  Those reporting SQL by processor better pay attention.

I receive 100’s of SPLA questions from the SPLA community about licensing and the cost associated with it. From the largest of the large providers down to a guy hosting Windows Web Server out of his parents basement (which is discontinued by the way), there’s always way you can reconsider your strategy. Moral of the story?  Pay attention to how you report and don’t report out of convenience…It can cost you.

Thanks for reading,

SPLA Man

 
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Posted by on December 30, 2014 in In My Opinion, Windows Virtualization

 

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Do you have SA? Why this question really matters.

Brett’s Hosting’s sales director is consistently looking on the web to see what competition is advertising.  It drives him nuts to see other “hoster’s” advertise SharePoint for less than what he can get directly from his reseller.  He’s upset..big time.   How can this be?  Then he stumbles upon the Microsoft Office 365 website.  He blew a gasket.  “There is no way I can compete!  I am going to go out of business!”

So the sales director decided to get creative.  “I will forgo SPLA and just have my customers purchase SharePoint.  They bring it into my datacenter, I won’t report SPLA anymore.”  So that’s what he did.  He started selling SharePoint by the truckload.  Their reseller kept placing orders for him as they’d joyfully ask  “how many CAL’s do you need?” and they would order it; never once asking what it was for.

Brett’s Hosting did a tremendous job marketing their SharePoint offering.  “No SharePoint…No Problem!” It was marvelous.  The CEO of Brett’s Hosting vociferously announced at the World Partner Conference “We are hosting over 10,000 SharePoint sites!”  The celebration continued.  Then one foggy October morning, the office manager for Brett’s Hosting received a letter from Microsoft.  She excitedly opened it thinking they were being promoted as ‘SharePoint Partner of the Year’ but was severely disappointed.  It was an audit letter.  The story turns.

Brett’s Hosting CEO reviewed the letter and then called in their sales director (now sales VP).  The CEO threatened him with his job unless he fixed this mess.  The sales director/VP was at a loss.  “Where did I go wrong.”

To be continued….

Where do you think he went wrong?  Have you ever been given wrong licensing advice?  You don’t need to answer that, I already know.

Hosting industry has changed.  Competition has changed.  End users have changed.  In my experience, the conversation has changed from “how do I license Windows” to “what are ways I can optimize my licensing spend?”  I’ve written about license mobility; I also reviewed SAL for SA.  Those two programs have a common theme – Software Assurance (SA).  In the above fictitious story, the sales person should’ve asked his customer “do you have SA on these licenses”  That question is important because if they do not have SA, the entire environment (hardware/VM) must be dedicated.

I can’t stress this enough.  The hosting game is getting brutal.  Every service provider is looking for a way to cut/reduce costs.  Getting in compliance hot water is not a good way to do that.  If the customer does not have SA, you can certainly use SPLA in its place.  If you go this route, be sure to make it a bundled solution.  Telling customers they must pay for something they already own is not an easy conversation.

The customer can also purchase SA.  You just have to be ready to clearly explain their options. That’s why it’s important to work with a reseller that understand SA benefits to help educate and coach you through the process; not all products are eligible.  Be prepared.

Story continued…

The sales vp went back to his customers and asked them to purchase Software Assurance.  When the customer asked “why?” all the sales vp could say is “because Microsoft told me you needed it.” (he clearly couldn’t explain why…it only made the customer more upset).  The customer simultaneously yelled and slammed the door –  “I’m going to Joe’s Hosting! They advertise VDI too!”

The sales vp went back to his CEO and was forced to resign.  The customer went to Joe’s Hosting and was very happy for over a year. When out of the blue he received a call from his sale rep from Joe’s Hosting.  The sales rep frantically told him they could no longer offer VDI; it apparently is not available under SPLA.  The sales rep also asked him to buy SA for his SharePoint…”Microsoft told me you needed it!” The customer loses again!

Moral of the story – read the SPUR, read the PUR, and don’t be afraid to ask “Do you want SA with that?”

Thanks for reading

SPLA Man

 

 

 

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Predicting the future…

Not an easy task.  When my kindergartener teacher asked “what do you want to be when you grow up?” I can promise you SPLA was not part of my vision.  (I should’ve worked harder to be a firefighter)

This post is 100% opinion based and would love the opportunity to hear/read yours. So here’s my take on SPLA and what’s next for the hosting industry.

Who will win the Amazon/Azure War? 

Contrary to popular opinion, I think Microsoft has already won this battle.  The reason might surprise you too as it has nothing to do with the service offerings or pricing; it has everything to do with who controls the licensing. I think we can all agree that Microsoft can make up their own rules to their own software.  What happens if Amazon spins up a Windows VM in their datacenter?  Amazon has to report it via SPLA.  Who ultimately get’s the SPLA revenue?  Microsoft.  What happens if Microsoft decides to offer fully hosted Windows 8 desktops using Azure or Office 365 but NOT authorize if for other service providers?  Yikes!!!  What happens if Microsoft authorizes MSDN mobility rights but not offer it for other service providers?  Oops…already happened.  What happens if they allow Office to be installed on 5 devices?  Oh man.

Will SPLA be replaced?

No.  Too  much revenue being generated for SPLA to just disappear.  SPLA produces recurring revenue for both Microsoft and the partner community.  Secondly, using SPLA does not mean that volume licensing is going away; Microsoft get’s the best of both worlds.  I do foresee volume licensing changing more rapidly than it already has.  I think that’s a good thing too.

Will VDI be allowed under SPLA in the foreseeable future?

No way.  This will never happen in my opinion. Let’s throw in the towel on this one.

Will the cloud industry expand or contract over the next decade?

Expand.  I think organizations will not only have hybrid/cloud environments but multi-cloud environments. As an example, I have multiple software vendors (such as Adobe for PDF’s, Symantec for Security, Microsoft for Office, etc) I believe organizations will use several vendors in “cloud” paving way for those service providers that have specialization and unique offerings to gain market share.  Yeah, they might not be the next Amazon, but they will be critical to the next phase of cloud. Specialization = Profitability.

Are all service providers going to be audited?

Yes.

Do I need to have a SAM practice?

Not if you don’t believe me in the previous question. Just don’t cry and say I didn’t warn you!

What will be the biggest driver to the cloud?

On premise compliance audits.  Once they get audited, they would rather have someone else worry about it; that someone else is you.

Will License Mobility be allowed for Windows?

No.  I don’t think there is a reason why it would.  Windows is cheap.  For those that have hosted for a while, remember the Windows Outsourcer/Non Outsourcer SKU’s?  Datacenter was over $200 a processor.  Standard was over $75 (US).

Will Microsoft raise rates?

Yes.

Will my hosting business succeed since I can’t compete against larger providers?

Yes.  You  need to change the way you promote your offering.  Think about this (and be honest with yourself) – what separates you from your competition?  If you were a customer looking for a hosted solution…why would “they”… choose “you”?  How can YOU… help ME (customer).  Is it to keep compliance?  Is it costs? Do your employees bring you new ideas or are they collecting pay checks?  Do you worry about being the lowest price or quality/uniqueness of your service?   Is it because you have an “in” and listen to SPLA Man?  If it’s the latter, you will win for sure.

Who’s the biggest threat to cloud providers present/future?

Governments

Will VDI be allowed under SPLA?

NOOOOO!!!!!  You asked this twice!  Come on! 🙂

Who will win the World Series in baseball?

Why…the St. Louis Cardinals of course!

Who will NOT win the Super Bowl this year?

St. Louis Rams – Ugh.

Thanks for reading,

SPLA Man

 

 

 

 

 

 

 

 
1 Comment

Posted by on September 8, 2014 in In My Opinion

 

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How to reduce your SPLA reporting

It’s easier than you think.  ( and no, I am not saying you should be out of compliant).  The goal of this blog is to educate and help the service provider community with their licensing decisions.  Keep in mind that I do this as a hobby.  I also try not to solicit, as that can be frustrating to the reader. 

That being said, I do know the reseller channel well, I also know the agreement better than most lawyers.  If you are looking to potentially reduce your spend from a reporting perspective, reduce compliance risk, or just simply want to chat about a licensing scenario that can be unnerving, let me know.  Send me a message on LinkedIn or shoot over an email – blaforge@splalicensing.com

So how do you reduce your spend?  That’s a tough question without a quick answer.  I would have to review your report to understand exactly how you can potentially reduce costs.  Nonetheless, I’ll give her a try. Here’s my top 3 ways service providers can reduce their licensing costs –

1. Run multiple instances of SQL on the same VM.  A little blurb in the SPUR states “For each virtual OSE for which you have assigned the required number of licenses….you have the right to run any number of instances of the software in that virtual OSE”  (page 23 of the SPUR for your boredom).  Keep in mind, there’s a difference between running an “instance” and running a VM. 

2. License the Core Infrastructure Suite (CIS) to run Windows and System Center Servers.  If you are reporting System Center and Windows separately….STOP!  System Center needs Windows.  In other words, you have to report Windows regardless; might as well pay less. 

3. Do not report Windows Standard….report Windows Datacenter.  You have the option of running unlimited VM’s with Datacenter edition.  If you are reporting Windows Standard, that means you are not virtualized. Get virtualized.

One more for good measure…

4.  SAL for SA – I still don’t understand why service providers do not report this SKU.  It’s less expensive, your customer can still deploy on premise and in your cloud, and you will be unique.  (I’ve only seen it reported once). 

There are many more ways to reduce spend. (even outside of simply licensing/virtualizing, etc.) There’s too many scenarios to review on a blog post. How about this trade off – If I can reduce your spend, you owe me a beer at a hosting conference. (joke for the record). If I can’t, at least you know your reporting correctly.

Thanks,

SPLA Man

 

 

 

 
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Posted by on July 9, 2014 in In My Opinion

 

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Hosting Summit Recap

Here are a few highlights and announcements from this year’s hosting summit.

Thanks for reading!

SPLA Man

 
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Posted by on March 21, 2014 in In My Opinion

 

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