Executive Focus: Understanding Microsoft Licensing

• Microsoft licensing challenges can increase business risk, impacting budgets, cash flow, and daily business activities.
• A high-level understanding of Microsoft licensing helps executives recognize situations that require their attention or outside expertise.
• Knowing the rules and options can help organizations optimize their spend and reduce exposure.

Microsoft licensing is a complex area that governs products and services used by most organizations every day. As most organizations are seeing an increase in their Microsoft-related budgets, it is important for executives to understand Microsoft’s approach to licensing to recognize when they should become involved with decision making, what kind of help their IT procurement teams need in order to be successful, and when a licensing situation rises to the level of requiring outside expertise. (For more information, see the sidebar “Why is Microsoft Licensing So Challenging?”)

This report is about Microsoft licensing—the rules Microsoft imposes upon the use of its products and services. It does not cover purchasing—how the products and services are priced and paid for; discounts, timing, and frequency of payments; or the right to purchase products or services.