Server 2016 Licensing

Windows Server 2016 licensing model

The business model for Standard and Datacenter editions transitioned from processor-based to core-based licensing in October 2016 with the general availability of Windows Server 2016 (all other editions of Windows Server 2016 continue to be on the processor-based licensing model). Core-based licensing provides a more consistent licensing metric across environments, enabling multicloud environments, improving workload portability for Windows Server through benefits like Azure Hybrid Use Benefit (AHUB), and helping remove friction across different licensing models.

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Customers with Software Assurance will transition to core-based licensing at their first renewal after the general availability of Windows Server 2016, although they can deploy Windows Server 2016 at any time.

The Windows Server 2016 licensing model includes both Cores + Client Access Licenses (CALs). Each user and/or device accessing a licensed Windows Server Standard, Datacenter, or Multipoint edition requires a Windows Server CAL or Windows Server and Remote Desktop Services CAL. A Windows Server CAL gives a user or device the right to access any edition of Windows Server of the same or earlier version. Each Window Server CAL allows access to multiple licenses of Windows Server.

Edition                  Licensing model       CAL requirements

Datacenter               Core-based*          Windows Server CAL**

Standard                   Core-based*           Windows Server CAL**

Essentials                 Specialty server      No CAL required 

** All physical cores on the server must be licensed, subject to a minimum of 8 core licenses per physical processor and a minimum of 16 core licenses per server.

** CALs are required for every user or device accessing a server.

Windows Server 2016 Standard and Datacenter: Core-based licensing

Core-based licensing requires all physical cores in the server to be licensed. Servers are licensed based on the number of processor cores in the physical server.

• A minimum of 8 core licenses is required for each physical processor and a minimum of 16 core licenses is required for each server.

• Core licenses are sold in packs of two.*

• Standard Edition provides rights for up to 2 Operating System Environments or Hyper-V containers when all physical cores in the server are licensed. For each additional 1 or 2 VMs, all the physical cores in the server must be licensed again.

• The price of a set of 16 core licenses (for a 2-processor server) for Windows Server 2016 Datacenter and Standard editions is the same price** as the 2-processor license of the corresponding edition of Windows Server 2012 R2. Windows Server 2016 Licensing Azure Hybrid Use Benefit With the Azure Hybrid Use Benefit, customers with Software Assurance can benefit from special pricing for new Windows Server virtual machines in Azure. Customers pay only for the base compute rate, which is currently the same as the Linux rate for virtual machines.

** 8 two-core packs will be the minimum required to license each physical server. The two-core pack for each edition is 1/8th the price of a license for a 2-processor server for corresponding Windows Server 2012 R2 editions.

** Rounding may result in slight variations in the final price of eight 2-pack core SKUs relative to the price of one Windows Server 2012 R2 processor SKU.

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Moving to core-based licensing

Customers purchasing net new licenses, for example, through MPSA or from an OEM, will purchase licenses under the core-based model. Existing customers with Software Assurance will transition from processor-based to core-based licensing at the first renewal after the general availability of Windows Server 2016.

• Renewal before the general availability of Windows Server 2016: Customers with Software Assurance will be on processor-based licensing and true-ups will also be processor-based.

• Renewal after the general availability of Windows Server 2016: Customers with Software Assurance will transition to core-based licensing and true-ups will also be core-based.

Core license grants overview

Customers with servers under Software Assurance will receive core license grants at the expiration of Software Assurance coverage. Depending on the core density of existing servers, there are two categories of core license grants: Full core licenses and additional core licenses.

1. Full core license grants: Customers with a server density of 8 or fewer cores per processor and 16 or fewer cores per server are eligible to receive full core license grants. Customers will receive a minimum of 8 cores per processor and 16 cores per server at the expiration of Software Assurance coverage after the general availability of Windows Server 2016. To receive full core license grants, customers do not need to document their environments.

2. Additional core license grants: Customers with a server density of more than 8 cores per processor and 16 cores per server are eligible to receive additional core license grants and pay only Software Assurance on the incremental cores. To receive additional core license grants, customers must maintain a record of the physical hardware and the configuration of the licensed server by using the Microsoft Software Inventory Logging tool (SIL) or any equivalent software. Inventory must be maintained at the first expiration of the Software Assurance coverage after the general availability of Windows Server 2016 or before September 30, 2019.

Note: Customers are not required to share inventory with Microsoft, but may be asked to share inventory if required.

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Announcing servicing guidelines for Windows Server 2016

With prior releases, Windows Server has been serviced and supported through a 5+5 model, with 5 years of mainstream support and 5 years of extended support. This model—renamed Long Term Servicing Branch (LTSB)—will continue with Windows Server 2016 for customers who choose to install full Windows Server 2016 with Desktop Experience or Server Core.

Customers choosing the Nano Server installation will opt into a more active servicing model—known as Current Branch for Business (CBB)—similar to the experience with Windows 10. This approach supports customers who are moving at a cloud cadence of rapid development lifecycles and wish to innovate more quickly. Since this servicing model continues to provide new features and functionality, Software Assurance is also required to install and use Nano Server.

How to deploy Nano Server?

Nano Server in a virtual machine

Follow these steps to create a Nano Server VHD that will run in a virtual machine.

To quickly deploy Nano Server in a virtual machine

  1. Copy NanoServerImageGenerator.psm1 and Convert-WindowsImage.ps1 from the \NanoServer folder in the Windows Server Technical Preview ISO to a folder on your hard drive.

  2. Start Windows PowerShell as an administrator, change directory to the folder where you’ve placed these scripts and then import the NanoServerImageGenerator script with Import-Module NanoServerImageGenerator.psm1 -Verbose

  3. Create a VHD that sets a computer name and includes the Hyper-V guest drivers by running the following command which will prompt you for an administrator password for the new VHD:

    > New-NanoServerImage -MediaPath <path to root of media> -BasePath .\Base -TargetPath .\NanoServerVM\NanoServerVM.vhd -ComputerName <computer name> -GuestDrivers

    where

    • <path to root of media> is the path that you provide to the root of the contents of the Technical Preview ISO. For example if you have copied the contents of the ISO to d:\TP4ISO you would use that path.
    • BasePath specifies a folder that will be created to copy the Nano Server WIM and packages to.
    • TargetPath specifies the full path, including the filename and extension, where the resulting VHD or VHDX will be created.
    • Computer_name is the computer name you provide for the Nano Server virtual machine you are creating.

    Example:

    New-NanoServerImage -MediaPath E:\ -BasePath .\Base -TargetPath .\NanoFolder\NanoVM01.vhd -ComputerName NanoVM01 –GuestDrivers

    This example creates a VHD from an ISO mounted as E:\. When creating the VHD it will use a folder called Base in the same directory where you ran New-NanoServerImage; it will place the VHD (called NanoVM01.vhd) in a folder called NanoVM01 in the folder from where the command is run. The computer name will be NanoVM01 and will have virtual machine drivers installed for running Hyper-V. If you choose ..\NanoFolder\NanoVM01.vhd, the result uses the MBR layout. If you want the GPT layout, use .\NanoFolder\NanoVM01.vhdx, which support Generation 2 virtual machines.

    System_CAPS_noteNote
    New-NanoServerImage is supported on Windows 8.1, Windows 10, Windows Server 2012 R2, and Windows Server 2016 Threshold Preview.
  4. In Hyper-V Manager, create a new virtual machine and use the VHD created in Step 3.

  5. Boot the virtual machine and in Hyper-V Manager connect to the virtual machine.

  6. Log on to the Recovery Console (see the “Nano Server Recovery Console” section in this guide), using the administrator and password you supplied while running the script in Step 3.

  7. Obtain the IP address of the Nano Server virtual machine and use Windows PowerShell remoting or other remote management tool to connect to and remotely manage the virtual machine.

Nano Server on a physical computer

You can also create a Nano Server VHD that will run Server Core on a physical computer, using the pre-installed device drivers. If your hardware requires a driver that is not already provided in order to boot or connect to a network, follow the steps in the “Adding Additional Drivers” section of this guide.

To quickly deploy Nano Server on a physical computer

  1. Copy NanoServerImageGenerator.psm1 and Convert-WindowsImage.ps1 from the \NanoServer folder in the Windows Server Technical Preview ISO to a folder on your hard drive

  2. Start Windows PowerShell as an administrator, change directory to the folder where you’ve placed these scripts and then import the NanoServerImageGenerator script with Import-Module NanoServerImageGenerator.psm1 -Verbose.

  3. Create a VHD that sets a computer name and includes the OEM drivers and Hyper-V by running the following command which will prompt you for an administrator password for the new VHD:

    New-NanoServerImage -MediaPath <path to root of media> -BasePath .\Base -TargetPath .\NanoServerPhysical\NanoServer01.vhd -ComputerName <computer name> -OEMDrivers -Compute where

    • <path to root of media> is the path to the root of the contents of the Technical Preview ISO. For example if you have copied the contents of the ISO to d:\TP4ISO you would use that path.
    • BasePath is a folder that will be created to copy the Nano Server WIM and packages to. (This parameter is optional.)
    • TargetPath is a folder that will be created where the resulting VHD will be created.
    • Computer_name is the computer name for the Nano Server virtual machine you are creating.

    Example: New-NanoServerImage -MediaPath E:\ -BasePath .\Base -TargetPath .\NanoFolder\NanoServer01.vhd -ComputerName NanoServer01 -OEMDrivers –Compute -Clustering

    This example creates a VHD from an ISO mounted as E:\. When creating the VHD it will use a folder called Base in the same directory where you ran New-NanoServerImage; it will place the VHD in a folder called NanoFolder in the folder from where the command is run. The computer name will be NanoServer01 and will have OEM drivers installed for most common hardware and has the Hyper-V role and the clustering feature enabled. If the server uses UEFI to boot, change NanoServer01.vhd to NanoServer01.vhdx.

  4. Log in as an administrator on the physical server where you want to run the Nano Server VHD.

  5. Copy the VHD that this script creates to the physical computer and configure it to boot from this new VHD. To do that, follow these steps:

    1. Mount the generated VHD. In this example, it’s mounded under D:\.
    2. Run bcdboot d:\windows.
    3. Unmount the VHD.
  6. Boot the physical computer into the Nano Server VHD.

  7. Log on to the Recovery Console (see the “Nano Server Recovery Console” section in this guide), using the administrator and password you supplied while running the script in Step 3.

  8. Obtain the IP address of the Nano Server computer and use Windows PowerShell remoting or other remote management tool to connect to and remotely manage the virtual machine