Windows Server licensing: Standard or Datacenter
The choice between Standard and Datacenter is not a question of company size. Both editions are technically almost identical, and the decision comes down to one arithmetic problem: how many virtual machines run on the same hardware. This page walks through that calculation and the core count rules that go with it.
Where the threshold between the editions lies
The functional difference between Standard and Datacenter is narrow. The licensing difference is not: it is virtualisation rights, and that is what decides the invoice.
Standard
Covers two virtual instances per fully licensed server. Need more, and you license the same hardware again, stacking sets of core licenses. Up to two virtual machines Standard is clearly cheaper, and for a physical server running a single workload it is the obvious answer.
Cheaper up to roughly four virtual machines per host.
Datacenter
Covers an unlimited number of virtual instances on the licensed hardware. The higher price is fixed, so the more densely you virtualise, the better it looks. It also includes storage features that matter in clustered environments.
Cheaper from roughly the fifth or sixth virtual machine per host.
Two details that shift the calculation
First, the host itself: if it does nothing but manage the virtual machines, it is covered by the Standard license. As soon as other services run on it, it counts as an instance of its own. Second, downgrade rights: volume licenses generally permit running an earlier version of the same edition, which matters when a business application is not yet cleared for the current release. Between two and five virtual machines the answer depends on your expansion plans, so tell us where you expect to be in three years rather than where you are today.
How many core licenses you actually need
Windows Server is licensed by physical processor core, not by server. Two minimums apply, and both must be satisfied at the same time. Getting this wrong is the most common costing error we see.
Sixteen cores per server
Every server must be licensed for at least 16 cores, regardless of how few it physically has. A machine with two six core processors has 12 physical cores but is still licensed as 16.
Eight cores per processor
Each populated socket must be licensed for at least 8 cores. A server with four four-core processors therefore needs 32 core licenses, not 16, because the per processor minimum applies four times over.
All physical cores above that
Where the server exceeds the minimums, every physical core must be covered. Licenses are added in packs of two. Powerful hardware with light utilization is where budgets are most often underestimated.
And then there are the access licenses
Core licenses cover running the server. They do not cover anyone using it. Every user or device that accesses server services needs a Client Access License in addition, and a Remote Desktop session needs a second one on top of that. Missing CALs are the most frequent audit finding by a wide margin, and they are rarely deliberate: the server was licensed properly and the number of users grew afterwards.
Frequently asked questions
How many core licenses does my server need?
At least 16 per server and at least 8 per populated processor, whichever is higher, and every physical core above that. Send us the processor count and cores per processor and we will calculate it before you order.
When does Datacenter become worthwhile?
As a rule of thumb from the fifth or sixth virtual machine on the same hardware, because below that you would be stacking Standard licenses. The exact threshold depends on the price difference in the specific quote, so we calculate both.
Does the host count as an instance?
Not if it exclusively manages the virtual machines. The moment other services run on it, it counts as an instance in its own right and consumes one of the two that Standard allows.
Can I run an older version than the one I bought?
Generally yes, through downgrade rights, which permit an earlier version of the same edition. This is often necessary because business applications lag behind on certification. We note what applies for each license.
Do pre-owned server licenses get the same updates?
Yes, to the same extent, for as long as the version is in support. We state the end of support date for every version before you commit, because on a server the price per remaining year of coverage matters more than the headline price.
Read further
CAL licensing explained
The access licenses that go with every server license: user versus device, the multiplexing rule and how to work out how many you need.
Used Microsoft licenses
What we supply, how an order works and the four documents that come with every license. For the European Economic Area.
Microsoft volume licensing
Why volume licenses may be resold, which forms may not, and how to identify what your own agreements contain.
We will do the core maths with you
Tell us the number of processors, cores per processor and planned virtual machines. You get a written calculation and a quote for the matching pre-owned licenses.