The Hidden Cost of Licensing Windows Server - Activation



  • Just looking at this with a customer that just put in a new Windows 2019 server. The machine was purchased with a volume license agreement for Server 2019 Standard. Everything should be super easy, in theory. Problem is, license key from the volume license center doesn't work. We spend a bit of time trying to get this to apply, but no luck. Called Microsoft, but they don't operate seven days a week so only support businesses during a specific five day, US daytime window. So we put in time working on it, then have to wait a couple of days anyway. In the end, even Microsoft themselves can't figure out how to activate the license that they sold to us and had to use their own "master" license key that works around pointless restrictions. Once that license was applied, they were able to then apply our own license. So they got everything fixed, but there is a real cost here that has to be examined.

    This seems to be par for the course. Some people see license issues regularly, some rarely. But they are there. How often is hard to say. In this particular instance, the purchase price of the license was around $700. But in order to apply that license, it took two or three hours of engineering support time first working on the license itself, then sitting with Microsoft support and helping them to fix the issue. That time adds up and fast. If you have internal staff that has nothing else to do, this time might not be too dramatic, but who has IT staff that truly has nothing else to worry about? If you have consultants, as most small businesses would, the cost is likely closer to $150/hr to get support. We will go somewhere in the middle and call the cost $400.

    $400 is a pretty significant "hidden" cost in a $700 purchase of Windows Server Standard that is, for all intents and purposes, simply an extension of the licensing cost. At this is a one time installation cost for the license. If the license has to be moved, it is totally possible, in reality totally likely, that the issue will come back up again!

    And that is just the hard cost. This doesn't take into account any delays or risks to projects that attempt to do an install during "standard project hours for IT" which are generally from Friday night and through the weekend. IT's main hours for deploying new systems is off hours for normal business. But Microsoft doesn't account for this and provides support only during the hours when you would less expect someone to need it. In this case, introducing a two day delay to the activation process. While this didn't create a big delay in this case, it did cause a number of items to be left until days later to be completed and could easily have impacted the project beyond just the lost man hours.

    Licensing has a lot of hidden risks and costs. It's easy to look at licensed software as just being a one time purchase cost. But in reality, the majority of cost and risk is often the part of licensing that we tend to overlook.



  • While I don't want to summarize this I kind of have too.

    Microsoft never sells licensing direct to the consumer (in this case the business) it's all third party even through their licensing channel.

    So it's very likely that someone in that line screwed up and assigned the wrong license version or something else.

    While I'm not downplaying the cost (it is very real) I am saying that a lot of this can be avoided when purchasing physical keys.



  • @DustinB3403 said in The Hidden Cost of Licensing Windows Server - Activation:

    Microsoft never sells licensing direct to the consumer (in this case the business) it's all third party even through their licensing channel.
    So it's very likely that someone in that line screwed up and assigned the wrong license version or something else.

    Totally possible. Except that we manually verified this, as did the vendor, as did Microsoft. And it was, at least according to Microsoft, the right license and in the end, it is the one that they used.



  • @DustinB3403 said in The Hidden Cost of Licensing Windows Server - Activation:

    I am saying that a lot of this can be avoided when purchasing physical keys.

    A lot of products don't have physical keys. Those that do, often come at a pretty hefty price premium to do so. Physical Windows Server is, I believe, a pretty big percentage more expensive, than from the volume licensing center.



  • Physical licenses then introduce the next cost - license retention and management. A different cost, but still a cost.



  • @scottalanmiller said in The Hidden Cost of Licensing Windows Server - Activation:

    @DustinB3403 said in The Hidden Cost of Licensing Windows Server - Activation:

    I am saying that a lot of this can be avoided when purchasing physical keys.

    A lot of products don't have physical keys. Those that do, often come at a pretty hefty price premium to do so. Physical Windows Server is, I believe, a pretty big percentage more expensive, than from the volume licensing center.

    Comparative to the $400 additional (estimated) spend on everyone's time?



  • @DustinB3403 said in The Hidden Cost of Licensing Windows Server - Activation:

    @scottalanmiller said in The Hidden Cost of Licensing Windows Server - Activation:

    @DustinB3403 said in The Hidden Cost of Licensing Windows Server - Activation:

    I am saying that a lot of this can be avoided when purchasing physical keys.

    A lot of products don't have physical keys. Those that do, often come at a pretty hefty price premium to do so. Physical Windows Server is, I believe, a pretty big percentage more expensive, than from the volume licensing center.

    Comparative to the $400 additional (estimated) spend on everyone's time?

    Hard to say. It's all about averages. In the case of this scenario, the risk was primarily up front. In the real world of an SMB with high turn over, the risk to physical licenses might be even higher. First, an increase in cost. Perhaps $100 more per license. Then the manual process of storing them. Then the hopes that those keys will not be lost over time. At first this might seem very easy to manage, but it is way harder than it seems for a normal business. A human has to retain and protect those keys for many years. And match them up to things. This quickly becomes time consuming as keys begin to be stored, tracked, retired, handed from person to person. It's the kind of thing that tends to fall apart, even in a small company with just two people. It can work, but in the real world, it rarely does. Lost keys or misused keys would, on average, likely cost even more.



  • Managing these licenses and their bizarre limitations, caveats, etc. is even greater still. 2 audits and 1 they are trying to get me to do, (but have ignored so far) are also not included in most people's cost projections.



  • @wrx7m said in The Hidden Cost of Licensing Windows Server - Activation:

    Managing these licenses and their bizarre limitations, caveats, etc. is even greater still. 2 audits and 1 they are trying to get me to do, (but have ignored so far) are also not included in most people's cost projections.

    It's very true. A lot of skills specific to Windows Licensing are needed. Between knowing what to buy, when to change, how to update, how to deal with fake audits, how to deal with real audits, maintaining court-ready documentation... all skills unnecessary for macOS, Fedora, CentOS, Ubuntu, etc. That's a huge skill set to maintain all the time. And one that carries a lot of liability.

    And loads of social engineering scams target this weak point in companies.



  • @scottalanmiller said in The Hidden Cost of Licensing Windows Server - Activation:

    Just looking at this with a customer that just put in a new Windows 2019 server. The machine was purchased with a volume license agreement for Server 2019 Standard. Everything should be super easy, in theory. Problem is, license key from the volume license center doesn't work. We spend a bit of time trying to get this to apply, but no luck.

    I have run into a similar situation this morning and not being able activate the VLSC liscense.

    Before I decided to call MS and getting frustrated, I was able to activate from an elevated command line.
    cscript c:\windows\system32\slmgr.vbs /ipk <product key>

    Throwing this out here in case someone comes along this post at a later time.



  • @pmoncho said in The Hidden Cost of Licensing Windows Server - Activation:

    @scottalanmiller said in The Hidden Cost of Licensing Windows Server - Activation:

    Just looking at this with a customer that just put in a new Windows 2019 server. The machine was purchased with a volume license agreement for Server 2019 Standard. Everything should be super easy, in theory. Problem is, license key from the volume license center doesn't work. We spend a bit of time trying to get this to apply, but no luck.

    I have run into a similar situation this morning and not being able activate the VLSC liscense.

    Before I decided to call MS and getting frustrated, I was able to activate from an elevated command line.
    cscript c:\windows\system32\slmgr.vbs /ipk <product key>

    Throwing this out here in case someone comes along this post at a later time.

    I've heard that that often works. We had tried that in our case and it had failed.