Although Microsoft hasn’t given us a release date for this “latest and greatest” server OS, we now know the Windows Server 2016 price tag.
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Microsoft Windows Server 2016 is expected to be released sometime in 2016

Windows Server 2016 is expected to be released sometime in 2016. Now we know the price.

Windows Server client access license (CAL)

Many IT professionals I know don’t understand that, when you purchase a Windows Server license, you are paying for the right to install the software on one of your servers. In other words, a software license conveys absolutely no ownership of the product itself. Historically, Windows Server licensing typically uses the model shown in the following diagram:

We license the server OS, the desktop OS, and the client access

We license the server OS, the desktop OS, and the client access.

In the previous example, we bought a Windows Server license, a Windows 8.1 license, and a Windows Server client access license (CAL). This model remains unchanged for Windows Server 2016.

Note that a Windows Server CAL licenses a user or device to access any Windows Server edition of the same or earlier version. However, some server services, namely Remote Desktop Services (RDS) and Active Directory Rights Management Services (AD RMS) require client access licenses of their own.

Standard vs. Datacenter

What also remains unchanged, licensing-wise, between Windows Server 2012 and Windows Server 2016 are the two primary software editions—Standard and Datacenter—and the rules regarding operating system environments (OSEs).

One of the cool things about Windows Server 2012 was that no feature difference existed between Standard and Datacenter editions. Instead, the differentiator between the stock keeping units (SKUs) was the number of Hyper-V virtual machines (VMs) hosted by a single server. Later in the article, I’ll show you that Microsoft changed that rule a bit in Windows Server 2016; there are indeed Datacenter-only features.

Anyway, back to virtualization: a single Windows Server 2016 Standard Edition license grants you use of the OS software on one physical host and up to two additional Hyper-V VMs. The Windows Server 2016 Datacenter license allows one “bare metal” installation with an unlimited number of Windows Server 2016 VMs. The catch here is that the hardware box’s primary role needs to be just that: a Hyper-V virtualization host.

You may know that Microsoft partnered with Docker to bring application and service containerization to the Windows Server platform. What’s cool is that the Windows Server 2016 Standard and Datacenter editions can both run an unlimited number of Windows Server Docker containers. That’s awesome!

The super stripped-down Nano Server option is also available in both Windows Server 2016 editions.

So do any features pertain only to the Datacenter edition?

Actually, yes. It seems that Microsoft is differentiating the Windows Server 2016 Standard and Datacenter SKUs not only on virtualization support but also for some features. The following features, whose documentation ranges from light to practically non-existent at this point, are included in the Datacenter edition but not in the Standard one:

  • Storage Spaces Direct: An extension of Storage Spaces that enables highly available shared storage to clusters with commodity hard disks
  • Storage Replica: Block-level, synchronous, multisite replication between clusters
  • Shielded Virtual Machines: Security technologies meant to protect tenant VMs from compromised Hyper-V server administrators
  • Host Guardian Service: Server role that supports shielded VMs
  • Azure-based software defined networking (SDN) stack

In summary, unless you’re the smallest of shops and/or you haven’t yet embraced virtualizations and the private cloud, your best bet is to stick with Windows Server 2016 Datacenter Edition.

CPU core-based pricing

Unless you’ve been intentionally avoiding Microsoft tech news over the past couple years, Windows Server is marching steadily to the beat of cloud cadence and integration with the Microsoft Azure public cloud service portfolio.

Recall that when we’re virtualizing Windows Server we don’t care about the number of CPU sockets on the hardware host. For that matter, we never get to see, much less touch, the physical hardware in Azure.

Thus, Windows Server 2016 breaks historical convention by aligning server OS licenses with CPU cores instead of sockets as previous Windows Server versions did. Incidentally, SQL Server 2014 has already adopted the cloud-friendly, core-based licensing model.

Frankly, the cost calculation details here get pretty darned obtuse and difficult to wade through. Read the Windows Server 2016 licensing datasheet, and I’ll do my best to walk you through the high-level points.

First of all, understand that Microsoft ignores hyperthreading and virtual CPU cores. Instead, you’re required to license every physical CPU core on your servers. Here are the details:

  • Core licenses are sold in modular packs of 2.
  • A minimum of 8 core licenses (4 x 2-packs) are required for each physical processor.
  • A minimum of 16 core licenses (8 x 2-packs) are required for each server.

Before you freak out at how expensive that sounds, know that Microsoft says that 2-core packs cost one-eighth the price of a two-processor (socket) license for corresponding Windows Server 2012 R2 editions.

Existing Software Assurance (SA)

If your company already has a Software Assurance (SA) licensing agreement with Microsoft, you’re probably highly interested to know how these Windows Server 2016 licensing changes affect you.

Here are the key details from the information Microsoft released thus far:

  • SA customers with existing per-CPU socket server licenses can upgrade to Windows Server 2016 at no cost.
  • At the end of your agreement term, your socket-based server licenses will be converted to core-based licenses.
  • You can migrate/reuse your Windows Server licenses in the Azure cloud.

Windows Server 2016 list price

Yet another question: “What’s the list price for Windows Server 2016?” Microsoft’s recent white paper quotes Windows Server 2016 16-core licenses (8 x 2-packs, remember) in the Microsoft Open License No Level ERP price book at:

  • Windows Server 2016 Standard: $882
  • Windows Server 2016 Datacenter: $6,155

Of course, those with previous experience in Microsoft licensing know that you rarely pay list price for your licenses. I strongly suggest that you sit down with your Microsoft licensing reseller to hash out the specifics for your organization.

Further reading

Microsoft product pricing is enormously complex and, at least in my humble opinion, profoundly boring, as important as it is. I’ll leave you with two more sets of resources to help you in your Windows Server 2016 licensing planning.

You may know that Microsoft gives us at least two tools for inventorying our server environment. Either the Microsoft Assessment and Planning Toolkit (MAP) or the new Microsoft Software Inventory Logging Aggregator will give you quantitative data in terms of calculating server cores for licensing and hardware compatibility with Windows Server 2016.

Finally, here are some must-read Microsoft licensing resources. Let us know what you think of all this in the comments!

  1. Gilles Tremblay 7 years ago

    Great article!

    Is there any limits of nano servers we can deploy if we use Server 2016 Standard Edition as an Hyper-V Host ?


    • Author

      Thanks, Gilles! We know that Nano Server is an installation option for both the Standard and Datacenter editions. From the Microsoft licensing FAQ (by way of MVP Thomas Maurer):

      “Nano Server is a deployment option within Windows Server 2016. It is included as part of the licensing of the edition from which it is deployed. There is no unique or separate licensing for Nano Server.”

      Given that, your hardware OS license = your Nano Server license. Now for the Hyper-V VMs:

      “Standard Editions still allows you to use two virtual operating system environments (OSEs) and Datacenter allows you to use unlimited OSEs, but they are now not licensed on processor or servers, they are now licensed based on cores.”

      And containers?

      “Hyper-V Containers are licensed the same as Hyper-V Virtual Machines. No information about Windows Containers right now.”

      I hope this helps. Licensing is a thorny bush, and is only more complicated with a pre-release product like Windows Server 2016.

      All the best to you,

      Tim W.



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