New Software Assurance benefit and terms to support hosted solutions

May 18, 2022

Today, as part of a speech focused on new initiatives to support European Cloud Providers, Microsoft President and Vice Chair Brad Smith announced important changes to Microsoft’s outsourcing and hosting terms. These changes will help customers more easily work with partners to get the licenses and subscriptions necessary for access to complex, hosted solutions, including desktop solutions. See below for details on what was shared and how these changes impact Microsoft’s customers and hosting partners.

What’s changing

As part of the evolution of Microsoft’s commercial experience and the transformation from on-premises software to the cloud, in 2019 Microsoft updated our licensing terms for outsourcing rights and dedicated hosted cloud services to clarify the distinction between on-premises, or traditional, outsourcing versus cloud services hosting, and to create more consistent terms across multi-tenant and dedicated hosted cloud services with several providers. This 2019 update to our terms related to dedicated hosting and license portability improved our partners’ ability to build and host competitively-priced services in either their data centers or Microsoft’s.

This latest update covers additional changes to our outsourcing and hosting terms to further support customers’ cloud transformation and give partners flexibility to provide more comprehensive cloud services.

The changes outlined in the announcement will impact partners and customers in the following ways. These changes don’t apply to Listed Providers:

  • Introducing a new Software Assurance benefit that also applies to eligible subscriptions, to allow customers to virtualize their existing server software subscriptions when they choose to move to the cloud. Customers can virtualize Windows Server, similar to how customers can do so on Azure, with any cloud provider (excluding Listed Providers), whether they have shared or dedicated tenancy.
  • Introducing changes to empower partners to sell customers the software licenses and services necessary for a partner to build complex solutions that customers can deploy on-premises or in the cloud.
  • Changing our terms to expand fulfillment options for qualified partners to serve their customers when delivering pre-built solutions on their own infrastructure. Customers can bring their own licenses to their partner, or the partner can sell them the licenses needed as part of the hosted solution.

Next steps

For more details on these initiatives, please see Brad Smith's blog that accompanied the May 18 announcement.

Frequently asked questions


On May 18, 2022, Microsoft announced some important changes to our outsourcing and hosting terms to better support customer and partner needs. These changes will empower partners to build and sell complex, hosted solutions, including virtual desktop solutions. They will also expand the range of products that customers can have hosted for them by cloud providers other than Listed Providers.  See this blog post for the announcement and more information.

The changes include updates to our outsourcing and hosting terms to further support customers’ cloud transformation and to give partners flexibility to provide more comprehensive cloud services. They are part of a broader initiative for European Cloud Providers but will be available to all customers and partners worldwide (with the exception of Listed Providers).


Highlights of the changes include: 

  • Introducing a new Software Assurance and subscription license benefit through which customers may bring their licenses to cloud providers’ data centers, whether the servers are dedicated or multitenant. 
  • Making it easier to license Windows Server in virtual environments. Customers will now be able to license the virtualized compute capacity they need, without having to count the number of physical cores on which the virtualized environment is hosted. 
  • Allowing cloud providers to run more Microsoft products for their customers—including Windows 11 and the Microsoft 365 Apps for Business and Enterprise—on their own cloud infrastructure.

Though the announcement took place in Europe and addressed concerns raised by European cloud providers, the benefits of licensing changes apply to our customers worldwide. The Microsoft Cloud Solution Provider program and Software Assurance are global, and these benefits will be made available globally.

These changes give customers more options for deployment, so they have more flexibility for their cloud needs. Customers will be able to run their software on the servers of any cloud hosting provider that isn’t a Listed Provider, regardless of whether the servers are dedicated or multitenant.

The changes will be rolled out over the coming months.

Eligible customers will have immediate access to the benefit once the changes are published in the Product Terms.

There is no additional cost to Software Assurance and subscriptions for these newly added benefits.

The changes are applicable to all Microsoft products sold through commercial licensing. Customers may take their licenses covered with Software Assurance or subscriptions to any non-Listed Provider cloud provider’s infrastructure. For example:

  • Software products such as Windows Server, Windows 10/11, and Office Professional Plus generally cannot be run on third-party multitenant servers currently, but customers will be able to run this software (and more) on multitenant servers after these changes are effective.

Microsoft already includes multitenant outsourcing rights for Exchange and SQL Server in its Software Assurance offering as the License Mobility benefit. We’re expanding Software Assurance to enable customers to use all Microsoft software sold through commercial licensing on any non-Listed Provider cloud provider’s infrastructure.

Microsoft will continue to make the SPLA program available to cloud hosting providers.

Microsoft will evolve the QMTH program for partners to build hosted solutions for their customers. More details will be announced on this in the coming months.

Microsoft currently offers License Mobility for some of its products (like SQL Server), which enables customers to run eligible software on qualified cloud hosting providers’ multitenant servers. We’re now expanding Software Assurance and subscription license benefits to enable customers to run all their Microsoft software sold through commercial licensing on any non-Listed Provider cloud provider’s infrastructure.

License Mobility through Software Assurance rights continue to permit deployment of licenses with License Mobility coverage on hosted cloud services through Authorized Mobility Partners. Rights to deploy licenses on Authorized Mobility Partners’ shared servers are not impacted by this outsourcing update.

There is no change to Azure Hybrid Benefit for workloads running on Azure shared servers.

No. There are no changes to the terms related to Listed Providers.

We are excited about these new benefits and look forward to sharing more soon in the coming months.