Mark Minasi's Windows Networking Tech Page
Issue #99 July 2012

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Hi all —

I'm busy putting together my new Windows Server 2012 class which debuts in late September, but as I keep my eye on Server 2012, I was delighted (really!) to see that Microsoft released their new pricing and feature set.  It's some seriously good news, but a little complicated, so I put together a quick newsletter to demystify the new Servers, and I hope you find it useful.  Before that, however, a word from our sponsor ...

Christmas in July: Server 2012 SKUs and Prices, Explained

Yesterday -- 5 July 2012 -- the Microsoft Server folks announced new pricing and SKUs for the not-yet-released Windows Server 2012, and, well, wow.  That announcement included some truly amazing news for most of the Server-using world.  Microsoft has essentially cut Enterprise Server's list price from $4000 to under $900 per physical server and from $1000 to $500 per virtual server.  (I said essentially... there are some catches, but I'll cover those in a bit.)

When I first saw Server 2012 last year in late August 2011, I was stunned at how many new features 2012 had acquired in just the two short years since R2's 2009 release, and remarked in a newsletter that

"Who knew those Microsoft folks could be such poker-faced, sneaky bastards?"

Well, I guess it's a good thing that I don't play poker with those characters, as they've done it again with this impressive new pricing.  I also remarked in that piece that to that point I'd been expecting to see most of the big surprises coming from the desktop version of Windows, but that so far it was Server that was doing most of the wow-ing.  Since then, however, the desktop folks have been doing a good job of delivering plot twists, from the initial unveiling of the Metro interface at BUILD in September to the in-depth blog posts at the "Building Windows 8" site ( to the sneak peek at the Surface tablet last month, and it's all impressive.  Despite all that, though, I must again say -- with no disrespect to the Desktop folk intended -- that in the end, yesterday it was the Server guys, who delivered a set of bigger, more exciting surprises with their new rearrangement of features and prices, so to date it's Server Team 2, Desktop 0.  (Although who knows?  We've not yet seen the final version of Windows 8 desktop.  Remote Server Administration Tools with Kinect support?  We'll see.)

Microsoft posted a number of pages with the new licensing details at, but here's my summary:

There are now essentially just two versions of Server that most of us will care about:  Standard Edition, which will cost $882, and Datacenter Edition, which will cost $4809.  They will have an identical set of features and have just one major difference: how many virtual servers you can create from one license.

Previously, most shops bought Standard, Enterprise, or Datacenter server.  The main differences were the feature sets (clustering, cluster sizes, job objects, numbers of physical processors supported, NUMA support, etc), the cost ($1000 list for Standard, $4000 for Enterprise, $2500-ish per physical processor for Datacenter), and how many virtual machines the license entitled you to create -- one for Standard, four for Enterprise, unlimited for Datacenter.  (And yes, I know that no one pays list, but I need a baseline for analysis here, so feel free to rework the numbers with whatever you pay.)  With 2012, Microsoft simplifies things a bit.  Basically...

Enterprise is gone.  Only Standard and Datacenter remain.  Odd as that sounds -- most medium-to-large shops bought Enterprise in R2 and before in droves -- a two-SKU world makes sense because...

Standard and Datacenter have an identical feature set.  Whoa, stop and think about that for a moment.  I don't run a large shop, so for years I've squeezed the most out of Standard's array of capabilities... but I've always lusted (a little, at least) for some of the Enterprise features.  But no more.  Want to build a Hyper-V cluster with 64 nodes?  Standard can do that.  Hot-add memory and use faster NUMA (non-uniform memory architecture)?  Standard can do that.  Try out the new no-downtime failover file server cluster?  Standard can... well, you get the message.  So why would I buy Datacenter ever?  Because...

Standard lets you create two virtual servers, Datacenter lets you create unlimited virtual servers.  Ah... more good news.  Standard's always been the (relatively) inexpensive server, but buying one Standard license only entitled me to create one virtual server.  With 2012, that doubles, at no greater cost.  Microsoft has been struggling to figure out how to license virtual servers since customers started virtualizing their Windows servers years ago.  They'd be crazy to try to charge full list price per virtual server, but they also know that nearly everyone virtualizes these days, whether cloudily or not, and Microsoft  wants a piece of that action.  No one's figured out what's fair or what's do-able in terms of charging for virtual server licenses, so this is Microsoft's latest swing at it.  Will it fly? 

To find out, go ahead and do the math on that for a moment.  Standard's $882 a copy and includes two virtual server licenses.  In contrast, Datacenter's $4809 and allows unlimited VMs.  You can buy five copies of Standard server for $4410 and thereby own the licenses to create 10 virtual servers, or alternatively spend a bit more for Datacenter and build 11 or more virtual systems.  Simple, then... if you need ten or fewer virtual servers, get five or fewer Standard licenses.  Above 10 virtual servers, just buy a monster box, put a copy of Datacenter on it, and create virtual servers to your heart's content.  Sounds good, but...

Each Standard or Datacenter Server license only supports two physical processors.  You knew there would be a catch... this is it, although it's not a big one.  Standard Server has, for as long as I can remember, supported four physical processors, Enterprise supported eight, and Datacenter supported as many as you liked, but Datacenter's cost was directly tied to the processors.  That notion of paying more with every processor that you plugged into your server motherboard always seemed a bit strange, but it's where 2012 takes us all, to an extent.  The $882 and $4809 prices that I've been quoting are the costs for Standard and Datacenter, on a two-processor system.  (And just so we're clear, that refers to two physical processors -- chips in sockets -- not cores.  If Intel made a processor with 32 cores, then you could buy a two-socket motherboard, pop Standard Server on it and have 64 cores and remain perfectly kosher, license-wise.)  Thus, in 2012, we go not exactly to per-processor pricing but instead to per-processor-pair pricing -- Standard Server costs $882 on a two-processor system but $1764 on a four-processor system, $2646 on a six-processor system, and so on.  Is it a good deal?  Well, if your server hardware has just two physical processors then Datacenter's about a wash, as Datacenter would have run about $5000 for two processors in R2.  If you used to buy Enterprise server, then running 2012 Standard on a two, four or six or even eight processor system is cheaper than Enterprise's old $4000 price tag.  About the only worse-off case is if you like to run Standard R2 on a four-processor system, as it'll cost you $1764 for two licenses where one $1000 license sufficed in the past.  And of course, the main cost of upgrading to 2012 for many won't be the server license but instead the client access licenses (CALs), and nothing's changed about that -- they'll need upgrading.

All in all, this is pretty interesting news, particularly when you consider 2012's range of new features.  I'll be covering those in more detail now that we're getting close to RTM.  There's lots to learn with the next version of Server, so have a great summer... but stay tuned!

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All contents copyright 2012 Mark Minasi.  I encourage you to quote this material, SO LONG as you include this entire document; thanks!  See you next month.