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Tag Archives: SPLA Reporting

Why a SAM Practice is Important

I recently took some time off to spend with Mrs. SPLA Man and the kids when my 13 y/o son asked me, “Dad, why do service providers only have one person reporting SPLA usage to their reseller? Why would they report anything if they didn’t know it was right? After all, you wouldn’t even drive away from a fast-food drive-thru or pay for a new pair of shoes unless the order was right or the shoes fit! So why would an SPLA provider spend thousands (if not millions) of dollars each month when they don’t know if what they are ordering is right! And then Dad, they get audited and have to pay even more!”

I was never so proud of my son. Me and Mrs. SPLA Man certainly raised him right. That story about my son was a bit silly, but the moral of the story is accurate. Why do service providers spend so much money reporting usage if they do not know it’s right?

I think they know it’s not right, but they also think it’s not that far off either. How many of you who have gone through an audit said this prior; “We might be off a SAL or two, but in the end, we won’t owe much. After the audit, they find themselves owing millions of dollars. So much for being off a SAL or two! Here’s where I think service providers do themselves a disservice in not having a SAM practice/plan in place.

  1. They only have one person reporting usage. In most cases, a procurement person or office manager will email an engineer, and the engineer will send an excel report with what he/she believes should be reported. The office manager reports it to the reseller. The problem with this scenario is what happens if the office manager leaves? What happens to the relationship with the reseller? Does the engineer know they should license what is installed? A great example is Office Pro Plus/Std. Most engineers will install Office Pro Plus, forget about it, and report Office Standard. Don’t be that guy!
  2. You are reporting simply because it’s a requirement by Microsoft. Yes, reporting is a requirement, but reporting SPLA should be used as a tool to gain information inside your data center. What is installed? What do users HAVE access to? Are we reporting SQL Standard when we installed SQL Enterprise? We report SQL Web, but is it a public website we are hosting? Reporting SPLA usage should provide you with insight into how profitable you are per individual customer. If you get audited and find out you should be reporting SQL Enterprise (that’s what is installed), but you report SQL Standard; how easy is it to go back to your customer and ask for more money? You just lost the customer and lost out on all that additional revenue. Reporting is about business intelligence.
  3. Not have a tool in place or SAM practice. The two go hand in hand (SPLA tool and SAM practice). You can have a tool, but what good is it if you only use it to scan a small portion of your data center? Are you saying the other parts of your data center are licensed 100% accurately? You NEED a SAM practice – document licensing rights, document contracts with your customer, have a paper trail with your reseller, know pricing changes, and use the tool to collect the actual data. Don’t know a SPLA tool provider? Use Octopus Cloud They are the only tool provider designed specifically for multi-tenant environements with licensing intelligence built in specific to the SPUR. Yes, I do marketing for Octopus 🙂

In summary, I know spending money to invest in an SPLA tool or SAM practice doesn’t seem appealing (it’s kind of like buying new windows for your house. Wow! I spent a thousand dollars on a new window, but no one would ever know it besides you). The same can be true about a SAM practice. A SAM practice will not win you new customers, but here’s one thing I will promise, it won’t lose you customers either.

Thanks for reading,

SPLA Man

 
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Posted by on June 15, 2021 in Uncategorized

 

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To use a tool or not?

Ahh, SPLA reporting. We’ve heard the line, the only sure thing in life is death and taxes. The only thing certain for a service provider is that Microsoft will change the licensing rules (frequently) and SPLA reporting. There’s not much we can do about Microsoft changing the licensing rules, but alas, there is something you can do about SPLA reporting. I’ve written this on several occasions, but it’s worth repeating. The biggest mistake a service provider will make is believing that SPLA reporting is a requirement by Microsoft. Yes, it is a requirement by Microsoft, but that is not the only reason you should track licensing. Let me provide an example, HostingRUs has one man managing their SPLA reporting. He runs a “foolproof” script that will identify everything in their environment. He reports all the licenses installed and looks at invoices to know the number of users to report. He submits it to his reseller. There is nothing wrong with that strategy except for one thing – nowhere in the reporting process is anyone tracking licensing rules, updates, optimization, and, more importantly, billing. So in the above example, yes, HostingRUs is reporting licenses to Microsoft, but they should consider so many other areas. Here’s another example. A member of my site (Mscloudlicensing.com) wrote me, saying, “Microsoft is really Sh*tting on me.” He has an application that requires Office Excel; his customer already owns Office 365. He wants to use the O365 license that his customer already purchased to be installed in his datacenter. Obviously, that is not possible without the QMTH addendum. That’s when he got a bit crabby and threatened an anti-trust lawsuit with Microsoft. (Good luck, my friend, but my money is on the company with a trillion dollars in the bank). What the service provider failed to do in this example is look at his datacenter environment from a perspective of what he can do, not what he can’t. He didn’t know he could offer just Excel (instead of the entire suite). He also didn’t consider using open office. He also had very little knowledge of who accesses the application indirectly. If you believe Microsoft changes the rules A LOT and SPLA reporting are cumbersome; then maybe a tool is worth it. I recommended Octopus Cloud to the service provider in my example above. Many service providers use Octopus to keep track of SPLA reporting, but more are using it as a business intelligence tool to understand what is happening inside their datacenter. Octopus helped him know what is installed versus what is reported (a big miss for him was reporting Office Standard, but Office Pro was installed – not only was he underreporting, but in reality, he just needed Excel in the first place, a third of the cost of Office Standard!) Can you imagine if he was audited? His customers just required Excel, but he was on the hook for Office Pro just because his engineer thought it was convenient when he installed it! So when I asked (in the title) should you use an SPLA tool or not? I would argue you can’t afford not to. If you report 1,000 dollars a month or 100,000 dollars a month, don’t you want to make sure you got it right? Thanks for reading, SPLA Man
 
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Posted by on April 28, 2021 in Uncategorized

 

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Top 5 Licensing Questions….Answered

You have questions…We have answers.  Another month, and another list of licensing questions asked by the hosting community.

  1. I have a small hosting company that runs primarily Linux machines with a few Windows VM’s mixed in.  The only thing we do customer facing with Windows systems is a small number of users access our application via a published app over RDP Web.  Do I need SPLA?

Yes.  You have Windows running in your cloud environment.  It does not matter how small or large the environment is.  One thing you might want to check out is the Cloud Platform Suite.  You must run Hyper-V and System Center but it could lower your costs. 

  1. I get CSP from one reseller and SPLA from another.  Do I qualify for the new QMTH addendum or do I need to get it all from one source?  Totally confused.

In QMTH, you are the CSP partner, not someone else.  I am guessing you are using the CSP reseller to go indirect.  If that is the case, you must become CSP Direct authorized.  Purchasing CSP from a third-party does not qualify you for QMH.  That being said, your customer can purchase CSP from any organization and you can host it for them (if you are QMH authorized).

  1. The audit bug got me. I think it’s because my reseller refuses to submit my usage report even though I sent it to them several times.  Any advice?

Microsoft can audit any partner they choose.  There’s not one factor that triggers an audit.  More eyes will be watching if you are continually delinquent on your monthly report.  The biggest reason why a reseller does not submit a usage report is because the provider is delinquent on their payments. Are you up to date? All payments paid to the reseller?

  1. Can I rent a PC using the QMTH addendum? I know in the past I could rent a Windows desktop license in SPLA.  Can I do it now?

I think it makes sense to do so but unfortunately it is not part of the addendum.  I would love feedback here.  Section C of the QMTH addendum states” “This Amendment does not authorize Customer to resell, distribute, or otherwise provide End User or CSP Licensees direct access to Windows 10 Software” In order to lease a PC to a third-party you need to follow the Microsoft Leasing Agreement. 

  1. I report Office, Exchange, SharePoint and Skype. I heard rumors of a price increase coming in the pipeline from various resellers that I reached out to.  Any truth?

Let me put it to you this way – The products you just mentioned happen to be part of Office 365.  I don’t foresee Microsoft lowering pricing in SPLA for the same products offered by Microsoft.

Thanks for reading,

SPLA Man

PS – What was the SPLA partner’s response to my answer for question 5?  “That’s BS Mate!”  My response?  “Don’t shoot the messenger.”  Have a question?  Email info@splalicensing.com

 
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Posted by on August 5, 2017 in Top 5 Licensing Questions

 

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Don’t be Jimbo

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

 

 

 

 

 

 

 

 
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Posted by on July 24, 2017 in Compliance

 

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Why Windows 10 in CSP stinks now but could be GREAT later

Microsoft made a pretty big announcement around Windows 10 and CSP.  Here’s a breakdown for those that are interested:

  1. Software Assurance is not included
  2. Windows 10 is available E3 and in CSP only
  3. Customers need a qualified OS license.  In other words, this is an upgrade license only.
  4. Not available under SPLA
  5. Not available in the shared computer activation model.
  6. Per user licensing with the ability to license on up to 5 devices per license.
  7. No minimum and surprise…no maximum either.
  8. Subscription is 1 year
  9. Pricing varies
  10. New use rights highlighted in the Product Terms

So why does this stink now but could be great later?  Pay attention to number 1, 4, and 5 in the list above.  That’s what stinks.   Think this will allow VDI?  Think again.

So why not?  Why the mystery around VDI and SPLA?  If I was Microsoft, I would go ahead and allow it but for only a select few SPLA providers.  Those providers are:

  1. Report on time.  Not one late payment/report during their agreement no matter what the excuse – “My reseller sucks” is not an excuse.  It’s a good reason to work with me though 🙂
  2. Deployed Hyper V (they must have some incentive to do this)
  3. Joined CSP program.

There you have it.  Microsoft wins big time – all that missed revenue from non reporters will get reported. Now you, the compliant service provider, will be allowed VDI in SPLA.

The likelihood of this happening is slim to none.  I do think Microsoft is missing out with the Windows 10/VDI restriction.  Ever since I started in SPLA, I’ve been asked about VDI (or the lack thereof).  That was 11 years ago.

Thanks for reading,

SPLA Man

 

 

 

 
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Posted by on September 29, 2016 in VDI

 

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