So, you’ve performed some internal analysis and found that your organization is 90% compliant with your Microsoft licensing environment – is that enough to pass an audit? You might think so, based on history. However, Microsoft has recently included verbiage in their agreement releases solidifying the penalties for organizations that are out of compliance by more than even 5%:
Microsoft’s software asset management organization used to be far less extreme in cracking down on licensing shortfalls than they are now. Typically, if an audit had revealed an organization’s licensing gap, Microsoft would allow the company to simply purchase the remaining licenses required through their existing agreements at their current volume licensing agreement discount rate they qualified. This is no longer the case.
A licensing variance greater than 5% is actually quite common. In many cases, organizations perform self-audits or “pulses” – however, these are not usually consistent or up to date with Microsoft’s stringent SAM audit process, which takes into account variables such as software assurance rights/benefits, purchasing history, software use cases, and more. So those self-audits they performed are not only incorrect, but also cost those companies time and effort.
What happens if we’re out of compliance?!
Let’s say you have purchased Office 2016 licenses for the devices in your company. 500 devices = 500 licenses, right? Then Microsoft’s SAM team enters, performs an audit and finds that you require Software Assurance to enable rights to access these application instances via third party devices – in other words, Software Assurance is mandatory. As these are your primary corporate devices and cover all 500 of your employees, because you do not have Software Assurance, you are now out of compliance more than 5%. Not only do you have to purchase the licensing AND Software Assurance products to replace your license-only product, you are now obligated to do that at list price +25% for each license.
Licensing unit price: $420.33
Total for 500 units: $210,166.67
AND, if you bought only the licenses and you actually need licensing + Software Assurance, the calculation is 500 devices x $1681.33 per device = $840,666.67
Total bill: $1,050,833.33 (and we can bet that somebody is going get fired)
This example only addressed one product, the Office suite. When you look at this from the stand point of virtualized server application environments, VDI/VDA, and the new Windows Server 2016 CORE requirements, the costs can become even more overwhelming.
SoftCare is our award-winning approach to effective software asset management. From our proprietary reporting tools and dashboard through to our expert licensing consultations and management process, we guarantee you have the right license for the right product with the right terms so you will never pay more than what you need and will always be in compliance. To get started today, fill out the form below and we’ll be in touch soon!
Written by Jonas Jasinskas, Microsoft Licensing Expert, MCP, SAM; Walid Jreidini, Regional Sales Manager – Eastern Canada; and Jason Mackay, General Manager – COMPAREX Canada