Jimbo had a small IT firm for which he provided backup, security, and hosting for two clients. He also purchased Office 365 licenses for a handful of users directly from the Microsoft Office 365 website and would bill them accordingly. Jimbo also had an application he tried to develop to help end users better communicate with one another. It was similar to SharePoint, but more seamless and had better integration with third-party applications. He had a SPLA, and had one person who submitted their usage report to their reseller. Unfortunately, that person got sick and passed away. Jimbo was sad and so was the rest of the staff.
To put his mind at ease, he spent every waking hour improving his application. He thought it was going to be the next best thing. I experienced the application firsthand myself, and found it to be a powerful tool. I even asked to invest in it, but without any money, (Mrs. SPLA Man spent it all at Target), I had nothing to invest with.
Fast forward a year later. Jimbo is still working on improving the application, and he's still hosting. One day, Jimbo received an email from Microsoft. It was titled “Self-Audit”, Jimbo was getting audited. One thing left unmentioned, Jimbo is the nicest guy on the planet. He replied to Microsoft and in the end, provided them with everything. All his server information, customer name, and reporting history. It was an auditor’s dream.
Several weeks later, Microsoft provided Jimbo with the findings. He owed $450,000 in unreported licensing fees. Why so high? No usage was being reported since the lady who reported SPLA passed away. When she was reporting, she reported the wrong thing. Instead of licensing Windows Datacenter, she reported Standard. Instead of reporting physical processors and/or cores, she reported per VM. Everything was a mess. Jimbo, who neglected his hosting practice for months to focus on his application, was left feeling very uncertain about his future. He did not have the funds to pay for licenses.
It’s unfortunate, but Jimbo had to shut down his hosting business. The application he built? Stopped. He tried to sell it, and last I heard very few were interested.
Why such a depressing story and was it true? Yes, the story is true (although slightly embellished). Why share it? I am telling you the story because there are too many organizations doing the same thing. They have one person who manages the licenses, one person who was in contact with the reseller, and one person who knew what they were reporting. What happens if that person leaves? Too many organizations are also buying Office 365, but not getting the best discount.
Licensing is challenging, and in the case of Jimbo, his love wasn’t reporting usage, it was developing an application. He should have had allocated resources to help manage his SPLA, so he could focus on what he knows best, the technology.
I am always asked why I created splalicensing.com and what's so different about SPLA Man than other blogs. I think the main difference is honesty. I am your licensing Siri or Alexa. I am SPLAlexa. (that was bad). Don’t be Jimbo.
Thanks for reading,
SPLA Man/SPLAlexa
SPLA Licensing 