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IT works to keep up with Microsoft's Windows 8 licensing shifts

Windows 8 licensing poses new challenges for IT admins, who need to know how it will affect costs, desktop virtualization and remote access.

Although licensing for Microsoft's Windows operating system is relatively simple for basic use, it's a different matter for businesses. Enterprise customers and desktop administrators must deal with a dizzying array of options, rules and restrictions.

First, let's cover some basic rules for Windows that continue to apply to Windows 8.

Full licenses needed

Unique among Microsoft products, Windows purchased with a computer from an OEM is permanently tied to the device on which it is first installed -- with the exception of Germany, where this restriction has been ruled invalid. Note that a motherboard replacement will generally require the purchase of another Windows license, since it is considered to be a "different" PC. Changing a hard disk, adding memory and other modifications will generally not trigger a new license requirement.

Microsoft does not sell full versions of Windows through any volume-licensing program. An organization cannot, for example, re-image bare PCs with a volume image. Those PCs must already have a full license, purchased through retail or an OEM, before the volume-upgrade license can be applied.

Retail licenses may not be downgraded to earlier versions, but recent OEM licenses can be downgraded two versions back -- Windows 7 to Windows XP and Windows 8 to Windows Vista. Volume upgrades can be downgraded all the way back to Windows 98.

How many installs?

Microsoft has generally restricted Windows to a single installation per PC, but that changed with Windows 7 and has been modified again for Windows 8.

The Windows XP Mode feature, which gave users of Windows 7 Professional a free Windows XP virtual machine, is not available for Windows 8.

With Windows 8, no free installs are offered, but Microsoft no longer refuses your money if you want to pay for a second installation. Windows 8 allows more than one copy of Windows to be installed on a physical PC -- such as in one or more virtual machines -- as long as each one has a valid license. This change enhances the value of the Client Hyper-V feature of Windows 8, in which the OS runs in a virtual machine and not directly on the hardware.

Software Assurance

Software Assurance (SA), Microsoft's upgrade and benefits offering for standard licenses, adds to the cost of a Windows license. SA is added automatically to all licenses purchased through Enterprise Agreements and can be purchased through other agreements, as long as it is added to a Windows license on a new a PC within 90 days of purchase.

Windows has the most complicated matrix of SA benefits of any Microsoft product. Since most customers acquire the latest version of Windows every time they buy new PCs, the primary benefit of SA -- a slightly discounted upgrade to the latest version of Windows -- lacks significant value. To attract annual payments from customers through SA, Microsoft locks other, more desirable benefits behind an SA requirement. This is particularly true for virtualization and remote access licenses.

Virtualization and remote access

As Microsoft struggles to maintain a central place for Windows in an increasingly non-Windows-device market, a Windows license to which SA has been added has become the key to unlocking many privileges for non-PC devices. In other words, if you want to use a non-Windows device for many purposes, you need not only a Windows device, but SA to do it as well.

With Windows 8, the primary user of a PC to which SA for Windows has been added can do the following:

  • Take Windows To Go, the right to install Windows 8 on a flash drive and boot it on any compatible device;
  • Access a virtual desktop infrastructure (VDI) from a Windows RT device;
  • Access an organization's VDI from any personal or third-party device as long as the user is not on the organization's premises -- roaming rights -- and
  • Purchase --for about $60 a year -- a Companion Subscription License (CSL), which lets the PC's primary user access VDI from up to four other personal devices or corporate-owned, non-Windows devices.

More on Windows 8 licensing

Standalone Windows Enterprise upgrade adds layer to licensing

ADK provides tools for Windows 8.1 deployment

Microsoft tries to simplify licensing with Windows 8

FAQ: How Microsoft licensing relates to Windows 8, BYOD and the cloud

Why is Microsoft's licensing scheme so complicated?

Windows 7 upgrades get easier with P2V Migration for Software Assurance

The list of devices licensed under a CSL does not include corporate-owned Windows devices. This prohibition has the perverse effect of promoting corporate ownership of iPads or Chromebooks rather than Windows PCs.

Microsoft's Virtual Desktop Access (VDA) subscription is still available. At about $100 a year, it costs more than the CSL and covers only a single device. VDA confers most of SA's virtualization and remote access privileges on devices that don't have or can't economically obtain SA.

Two longstanding remote-access rights for physical machines have been continued in Windows 8. The primary user of a physical PC can access that PC from any other device. This legalizes PC-to-PC software, such as GoToMyPC, LogMeIn or TeamViewer. In addition, any device licensed for Windows 8 Pro can access any other physical device licensed for Windows 8 Pro.

Windows Enterprise

Volume-license customers that purchase SA for Windows on a PC also gain access to the Windows Enterprise edition, which offers some advanced features, such as Direct Access, Branch Cache and application sideloading, which is the ability to install a custom Metro-style Windows 8 app directly on the computer, rather than publishing it through the Windows Store.

Several features that were part of the Windows 7 Enterprise, particularly BitLocker and the Multilingual User Interface, no longer require SA and Windows 8 Enterprise Edition. They are now built into OEM and retail Windows 8 Pro licenses.

Dig Deeper on Windows 8 and 8.1

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Article is out of date.

SA no longer can be added within 90 days of new OEM or retail purchase.
Enterprise now is a separate SKU, you do not get it automatically when purchasing SA
Price to people who would previously need Enterprise and would just add SA to a new computer has risen 278% as a result of changes.

Wow! I don't think they could have made this any more complicated if they had tried. This is a minefield which almost anyone can easily step into. It's no wonder a number of us are avoiding upgrading from XP.
The article isn't quite yet out of date, but your observation about Enterprise Edition becoming a separate (and very expensive) SKU is valid. That was announced after this article was written. This change makes it prohibitively expensive for customers to get to Enterprise Edition without entering an Enterprise Agreement, in my view.
However, note that until July customers can still add SA to OEM purchases. From the April 2014 Product List:
"Select Plus, Open Value, and Open License Programs: customers may continue to acquire SA for new devices licensed for Windows 8.1 or 8 Pro or Windows 7 Professional OEM or FPP within 90 days of purchase until July 1, 2014."