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SQL Server 2012 switching to Core-Based Licensing

I found this news item from Directions on Microsoft, “SQL Server 2012 Adopts Per-Core Licensing Model” interesting.

SQL Server 2012 now requires processor core-based licensing for SQL Server 2012 enterprise edition, and core-based licensing is one of two types of licensing available for SQL Server 2012 standard edition.

For about 6-7 years now, ever since Oracle started charging for processor core, Microsoft enjoyed an easier licensing conversation because they licensed per processor, and not per core. I used to sell Microsoft technology, and had to answer licensing questions often about how their products were licensed, and was glad that Microsoft was only charging per processor, and not per core. It felt, at the time, that Microsoft wasn’t trying to penalize people for using the latest and greatest CPUs (which then were arriving with 2 cores, or 4 – of course, now, there are many more cores).

How times change. Apparently, Microsoft isn’t concerned about competitive licensing scenarios with Oracle any longer. I think that is probably a good thing for Microsoft. It probably also means that Microsoft’s internal models probably identify that they have been leaving money from customers on the table, and that moving to a per-core license will be able to extract a little bit more from customers than the per-server licensing model. All’s fair in product licensing?

Redmond.mag quotes Wes Miller, an analyst with Directions on Microsoft, as saying that a single Enterprise core for SQL Server 2012 will have a list price of $6,874 per core. These are only sold in two-core packs. A server can be partially licensed or fully licensed. A fully licensed server requires a minimum purchase of 4 cores. Of course, volume licensing customers and customers with an Enterprise Agreement and Software Assurance will have significant discounts off of the list price.

I do like the flexibility of the licensing model to allow customers to move licensed cores from on-premise to hosted cloud providers and back again.

I was pleased to see the analysis on thelowercasew.com:

The actual cost for EE is roughly the same as if you licensed 2 sockets of SQL 2008 R2 Enterprise Edition as long as it had 4 cores per CPU. The cost goes up as soon as you start using 6 core processors and above. The prevalence of 4 core processors means this likely won’t change much for many organizations.

Compared to SQL 2008 R2 Datacenter, however, there is a large cost difference. Datacenter costs $54,990 per processor or over $100,000 to license a 2 CPU system. You can now essentially get the benefits of Datacenter Edition (unlimited virtualization rights, etc.) for half the cost you would pay in SQL 2008 R2.

Even with this new licensing model there are still huge cost savings to be had by licensing all cores of a server and virtualizing your SQL 2012 workloads. It’s hard to argue with unlimited virtualization rights especially for those lightly loaded SQL workloads.

I wonder if this model will also fall through on the upcoming next version of SharePoint Server licensing that will be out sometime this year or early next year. My guess is that this will also apply to the next version of SharePoint Server. (I have no insider knowledge of this, this is just a guess.)

Links:
Directions on Microsoft report

Microsoft SQL Server 2012 licensing page

Redmond.Mag: SQL Server 2012 to Bring Some Price Hikes

thelowercasew.com: New SQL 2012 Licensing and its Impact on Virtualization

  1. akismet-19d195e041f3ae9af2c22430a944a739
    April 12, 2012 at 11:43 pm

    A SharePoint per core license – I dont think and hope so… but its reasonable!

    Good read!
    Max

    Like

  2. April 14, 2012 at 7:15 am

    SharePoint won’t be licensed by core. Most of the revenue from SharePoint (like 80-90%) comes from CALs, and if they switched to cores, the gigantic investment that customers have in CALs would be worthless. Ain’t gonna happen.
    One very important point that the Directions report does not make is that if you are running SQL Server in VMs, you will almost certainly need to purchase Software Assurance on each core license. That adds 25%, or 75% over the term of a 3-year contract, to the pricing here. SA was not required to do the same thing with SQL 2008; they introduced it with SQL Server 2008R2, but the Datacenter Edition let you run unlimited VMs without SA. Now, the DC edition has been killed and there’s no way to do unlimited SQL VMs without SA. For people using 8 and 10-core procs, this will quadruple the price of unlimited SQL virtualization on SQL Server Enterprise.
    Paul DeGroot
    Principal Consultant
    Pica Communications
    http://www.picacommunications.com
    “Solving the Microsoft Licensing Puzzle”

    Like

  3. April 14, 2012 at 8:29 am

    Hi Paul, you are correct about the CAL portion of the license. I don’t think that CAL licensing will change. I am only referring to the server component of SharePoint licensing. I should have clarified the difference between the two. Both components are required for SharePoint licensing. Good point!

    Like

  1. April 16, 2012 at 6:24 am
  2. April 16, 2012 at 6:30 am

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