Microsoft cost-based licensing optimization example

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  • Updated March 12, 2026
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    Summary of Microsoft Cost-Based Licensing Optimization Example

    This content presents a practical case for software asset managers on how to optimize Microsoft SQL Server licensing within a VMware cluster deployment. It focuses on maximizing the use of available SQL Server entitlements to reduce costs effectively.

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    Key Features

    • Entitlements: The manager oversees SQL Server licenses, including 1800 Enterprise Core licenses and 600 Standard Core licenses, each with associated costs.
    • Infrastructure: The deployment consists of three physical hosts running various SQL Server versions within a VMware cluster.
    • Licensing Options: Three different licensing strategies are provided, detailing the rights required and the total costs associated with each approach.

    Key Outcomes

    The software asset manager evaluated the licensing options and determined that using a combination of SQL Server Enterprise and Standard licenses in a virtual layer (Option 3) was the most cost-effective solution, resulting in total savings of approximately $103,600.

    This example demonstrates how a software asset manager can optimize Microsoft SQL Server licensing in a cluster deployment.

    In this example, a software asset manager is managing the following Microsoft SQL Server entitlements:
    Table 1. Microsoft SQL Server entitlements
    Entitlement Name License Type Number of Purchased Rights Cost Per Core
    SQL Server Enterprise Licenses SQL Server 2019 Enterprise Core with Software Assurance 1800 $5000
    SQL Server Standard Licenses SQL Server 2019 Standard Core with Software Assurance 600 $1300

    The following infrastructure is a VMware cluster that consists of three physical hosts. Each physical host contains virtual machines (VMs) that are running various versions and editions of Microsoft SQL Server. These VMs may potentially be moving across all physical hosts within the cluster.

    Microsoft SQL server cluster

    Based on the available entitlements and the cluster infrastructure, the software asset manager can license the cluster using one of the following options:
    Table 2. Licensing options
    Option Number License Type Licensing Layer Number of Rights Required on Each Host or VM Total Number of Required Rights Total Approximated Cost
    1 SQL Server 2019 Enterprise Core with Software Assurance Physical host layer
    • Host 1: 12 rights
    • Host 2: 16 rights
    • Host 3: 24 rights
    		 12 rights (Host 1) + 16 rights (Host 2) + 24 rights (Host 3) = 52 rights total 52 rights X $5000 = $260,000
    2 SQL Server 2019 Enterprise Core with Software Assurance Virtual layer
    • VM-1: 4 rights
    • VM-2: 4 rights
    • VM-3: 4 rights
    • VM-4: 4 rights
    • VM-5: 4 rights
    • VM-6: 4 rights
    • VM-7: 4 rights
    • VM-8: 4 rights
    • VM-9: 4 rights
    • VM-10: 8 rights
    • VM-11: 8 rights
    		 4 rights (VM-1) + 4 rights (VM-2) + 4 rights (VM-3) + 4 rights (VM-4) + 4 rights (VM-5) + 4 rights (VM-6) + 4 rights (VM-7) + 4 rights (VM-8) + 4 rights (VM-9) + 8 rights (VM-10) + 8 rights (VM-11) = 52 rights total 52 rights X $5000 = $260,000
    3 Both SQL Server 2019 Enterprise Core with Software Assurance and SQL Server 2019 Standard Core with Software Assurance Virtual layer
    • SQL Server 2019 Enterprise Core with Software Assurance:
      • VM-1: 4 rights
      • VM-9: 4 rights
      • VM-10: 8 rights
      • VM-11: 8 rights
    • SQL Server 2019 Standard Core with Software Assurance:
      • VM-2: 4 rights
      • VM-3: 4 rights
      • VM-4: 4 rights
      • VM-5: 4 rights
      • VM-6: 4 rights
      • VM-7: 4 rights
      • VM-8: 4 rights

    • SQL Server 2019 Enterprise Core with Software Assurance:

      4 rights (VM-1) + 4 rights (VM-9) + 8 rights (VM-10) + 8 rights (VM-11) = 24 rights total

    • SQL Server 2019 Standard Core with Software Assurance:

      4 rights (VM-2) + 4 rights (VM-3) + 4 rights (VM-4) + 4 rights (VM-5) + 4 rights (VM-6) + 4 rights (VM-7) + 4 rights (VM-8) = 28 rights total

    		 (24 rights X $5000) + (28 rights X $1300) = $156,400
    The software asset manager determines that option number 3 is the most cost-effective licensing solution for the cluster. By using this licensing option, the software asset manager can achieve a total cost savings of approximately $103,600.