Cloud Services Pose Risk of License Noncompliance

• Customers who license a subset of their users for Office 365 E5 and Enterprise Mobility + Security E5 suites could face unexpected costs down the road.
• Microsoft guidance for the problem is of limited value.
• Enterprise customers have some options to improve cloud license compliance, but none are ideal.

For the first time, Microsoft has publicly acknowledged that customers who license a subset of (rather than all) users for Office 365 E5 and Enterprise Mobility + Security (EMS) E5 may have challenges maintaining license compliance for E5-level features. This admission, made in a recently published License Guidance document, is especially relevant because some Directions on Microsoft customers have indicated that Microsoft has started to point out gaps and insist that noncompliance be remedied through system reconfiguration or additional license purchases. E5-related issues highlight the much broader issue of license compliance in the cloud, along with the limited strategies available to customers to address the challenge.