Did you know that Microsoft restricts Windows Server bring-your-own-licensing (BYOL) on AWS and Google Cloud to Windows Server 2019 and prior versions? Are you planning to upgrade to Windows Server 2022/2025 as Windows Server 2016/2019 near the end of support? Should you modernize these workloads and leave the cost and licensing complexity of running Windows workloads behind forever?
AWS and Google Cloud customers should consider these questions carefully in preparation for license restrictions that may prevent them from bringing Windows Server licenses to the cloud of their choice. The two primary solutions for addressing these challenges include displacing Windows Server through modernization or changing from Windows Server BYOL on dedicated cloud infrastructure to license-included Windows Server alternatives.
Evolve Cloud Services is skilled at helping businesses assess the cost and technical viability of every available option. This level of analysis ensures that decisions are data-driven and based on a thorough comparison of different choices.
Windows Server Bring Your Own License (BYOL)
Organizations who license Windows Server on-premises commonly use Windows Server Datacenter, which offers unlimited virtualization in return for licensing all the physical cores. This licensing benefit allows for “oversubscription”, which means that it is possible to run a high number of virtual cores while only being responsible for licensing the physical cores on the server. This can be cost effective, especially in heavily virtualized scenarios where the number of virtual cores is significantly higher than the number of physical cores. The licensing model is also simple with low compliance risk because the number of virtual instances does not have to be tracked or accounted for.
When organizations explore moving Windows Server workloads to the public cloud, they often start by evaluating the cost of a license-included model, where the cloud provider bills them for the use of Windows Server on a pay-as-you-go basis. While there are advantages to this model, including the ability to turn off resources that are not in use, organizations sometimes face increased cost compared to licensing on-premises servers with Windows Datacenter in return for unlimited virtualization. This cost difference can lead to sticker shock when the price of using cloud instances that include Windows Server is compared to licensing the same environment on-premises.
This challenge is addressed differently between Microsoft Azure and their largest competitors: AWS and Google Cloud. Microsoft Azure customers typically use the Azure Hybrid Benefit (AHB), which grants a discount on Windows Server based on the number of Windows Server licenses the business owns with Software Assurance. There is an eight core per-instance minimum, which can significantly increase the number of licenses needed to maintain AHB discounts across the entire deployment.
Determining true AHB savings requires a deep analysis. Based on Evolve Cloud Services assessment data, over 80% of businesses did not own enough Windows Server licenses with Software Assurance to cover the number of instances they required on Azure. On average, these customers were found to be approximately 5700 cores short. To meet this deficit, customers using AHB often purchase additional Windows Server licenses and Software Assurance resulting in additional license and ongoing Software Assurance maintenance. Organizations should consider all these factors when determining the level of savings that AHB truly offers.
Microsoft does not extend Azure Hybrid Benefits to the non-Azure cloud. Cloud providers, such as AWS and Google Cloud, compete with AHB by offering dedicated hosts which are physical servers dedicated to the use of one customer. These solutions allow their customers to bring their own Windows Server Datacenter licenses and license by physical core while maintaining the same virtualization benefits they have on-premises.
How are the Windows Server BYOL Rules Changing?
Microsoft made licensing changes in 2019 that limited “Listed Providers” which include AWS and Google Cloud. While Microsoft named Microsoft Azure as a Listed Provider, Azure customers using AHB are not impacted by this licensing change. The 2019 changes only impacted BYOL in Listed Provider environments, specifically for products that are not eligible for License Mobility. Examples of products were impacted due to lack of License Mobilist benefits include Windows Server, Microsoft Office, and Visual Studio.
For Windows Server licenses to remain eligible for BYOL on the dedicated servers of non-Azure Listed Providers, the updated licensing rules require that:
- the licenses are perpetual (non-subscription) and were purchased under an agreement that was effective before October 2019
- the versions are Windows Server 2019 and prior only
Businesses often have significant quantities of Windows Server Datacenter licenses purchased before October 2019. The larger challenge is the BYOL limitation on version. As organizations upgrade to Windows Server 2022/2025 (and future versions), they can no longer BYOL these licenses to AWS or Google Cloud. Based on data from Evolve Cloud Services assessments, the number of businesses running Windows Server 2022 is growing quickly. From 2021 to 2024, only 5% of the customers Evolve assessed were running Windows Server 2022. However, there was a significant increase in 2025 as this number grew to 18%. Upgrading to Windows Server 2022 limits BYOL on Listed Providers, and 56% of the organizations Evolve assessed in 2025 had only partial or no BYOL rights.
This becomes a bigger issue as BYOL eligible versions of Windows Server reach the end of extended support and are no longer eligible for security updates or patches. With Windows Server 2016 and Windows Server 2019 reaching the end of extended support in January 2017 and January 2029 respectively, the end of supported Windows Server BYOL on AWS and Google Cloud is looming.
There are two strategies for addressing these challenges. The first option is to move to a license included model for Windows Server. While this has pros and cons, the better long term decision may be to modernize and remove the complexity and cost of licensing Windows Server. We will explore these options and detail how Evolve Cloud Services helps businesses identify cost effective options that reduce complexity and improve the technical experience.
License Included Windows Server
A migration from Windows Server BYOL to a license-included model is the first option that many organizations will explore. In this scenario, Windows Server is purchased on-demand directly from the cloud provider in a pay-as-you-go (PAYG) model based on usage. The customer pays for the resources they require and can turn off resources when they are not required to lower cost. This option allows businesses to continue using Windows Server and avoid large scale technical and platform changes.
Moving to license included Windows Server also removes the requirement for dedicated hosts, which may be more complex to manage and lacking in the full range of features available on shared tenant cloud environments. The option to move to shared tenant is welcome news for organizations who were forced to use dedicated hosts purely to meet BYOL requirements.
However, some organizations may still choose to remain on dedicated hosts, even if they must purchase license included Windows Server. Dedicated hosts can remain cost effective when an organization is bringing SQL Server Enterprise licenses. For example, an Amazon EC2 Dedicated Host customer could purchase Windows Server as license included while bringing and licensing SQL Server Enterprise by physical core in return for significant, although not unlimited, virtualization benefits. In this situation, there may be a significant cost benefit for remaining on dedicated hosts.
Choosing the most strategic licensing and tenancy option requires a data-driven analysis of server and workload requirements. Licenses counts must be reviewed and BYOL eligibility must be determined. Evolve Cloud Services can help businesses analyze these different models while demonstrating the cost and technical implications of different choices. Through the technical engagement, Evolve will also “right-size” the server instances and identify the most optimal instance sizes. This stop can reduce cost tremendously by helping organizations avoid paying for more resources than they require.
Modernization
Migrating to license included Windows Server may feel like the “easy button”. However, modernizing to a “born in the cloud”, solution presents an intriguing non-Windows alternative for businesses that have become weary of the high cost and licensing complexity of running Microsoft workloads. The restriction on Windows Server BYOL is a perfect example of why an increasing number of organizations are exploring their options. Modernization removes this complexity and allows organizations to better focus on their business. Thios is preferrable to spending time and resources planning for the next end of support date, license change, or limitation on cloud choice.
There are many additional advantages to modernization including:
- Increased productivity as developers shift toward innovation and away from managing hardware and updating software
- Improved scalability and flexibility to meet the dynamic needs of a growing business or software offering
- Access to secure and compliant solutions that are designed for the cloud
- Pay-as-you-go pricing without long term commitment
- Integration with AI and machine learning
- Availability of fully managed, serverless architecture that can automatically scale to meet user demand
AWS and Google Cloud both offer modernized solutions and incentives that assist in the transition from a technical and financial perspective. Proactively exploring these options allows businesses to choose the best long term strategy and avoid being forced into a last minute decision based on an end of support date or a Microsoft licensing restriction.
Evolve Cloud Services has partnered with AWS to offer a modernization service for a full range of Microsoft software. There are three phases to this engagement. In the first phase, Evolve collaborates with the business to identify workload requirements and motivations to modernize. In the next phase, Evolve’s free Modernization Viability Assessment is used to establish modernization goals, identify the workloads best suited for modernization, and to determine the modernized solutions best suited for the requirements. An analysis is generated that demonstrates the total cost of ownership (TCO) available through various modernization options. In the final phase, Evolve Cloud Services collaborates with the customer’s technical teams to build, test, and modernize the applications. Additional information is available here.
Evolve Cloud Services Can Help You Assess Your Options
There are several factors to consider while transitioning from Windows Server BYOL. Evolve Cloud Services is skilled at helping businesses make the most strategic choices by assessing the cost and technical viability of every option. The assessment process typically begins with an analysis of an organization’s technical requirements, usage patterns, and an identification of BYOL-eligible licensing counts. Evolve uses the data from this analysis to identify and contrast the cost impact of various options. After completing this analysis, businesses can be confident that every viable option has been explored deeply and comprehensively, and that their final decisions are supported by data.
Can Evolve Cloud Services assist you in identifying the best transition plan for your business? Are you ready to get started?
If you would like to learn more about receiving a fully funded AWS Optimization and Licensing Assessment, please click here.
Information on the Modernization Viability Assessment and partnering with Evolve Cloud Services to modernize your server workloads is available here.
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