Monthly Microsoft License Update October 2023
Welcome to the October 2023 instalment of the Microsoft Product Terms Update from the Version 1 Microsoft License Consulting Team. Each month, Microsoft releases license changes on their product terms. This month sees a variety of updates to both product terms and supporting license briefs.
For your convenience, we have uploaded a recording that discusses these changes in more detail.
Windows Server Standard. Datacenter and Essentials: Added use rights for Windows Server Annual Channel for Containers. The actual use right is outlined as ‘Customer may use Windows Server Annual Channel for Containers only as an operating system to host Windows Server containers in conjunction with a Certified Kubernetes product, as defined by Cloud Native Computing Foundation.’
Further exploration of the Cloud Native Computing Foundation
(https://www.cncf.io/certification/software-conformance/) shows that most of the major software vendors and cloud computing providers such as AWS or Red Hat are there.
Office 365 Sites: In August 2023, Microsoft announced a significant change to their licensing approach for Microsoft 365, Office 365, and Microsoft Teams in the European Economic Area (EEA) and Switzerland. This move was prompted by concerns over potential anti-competition disputes with the European Commission following a complaint from Slack in July 2020.
As of October 1st, new customers in the EEA and Switzerland are only able to purchase Office 365 and Microsoft 365 licenses that exclude Teams. If they later decide to acquire Teams, they can do so by purchasing a separate license, resulting in a slight price increase.
Existing customers who are already subscribed to any of the affected suites have several options. They can continue to use, renew, and add seats to their current plans as usual. Alternatively, they have the choice to switch to the new licensing line-up, which can be done on their contract anniversary or renewal date.
These changes are reflected in the October 2023 product terms, specifically in the section titled ‘Office 365 EEA (no Teams) and Microsoft Teams EEA.’ Microsoft has introduced these alterations to adapt to possible regulatory headwinds in the EEA and Switzerland.
Microsoft 365: Added Microsoft Defender for IoT Device License to Availability and License Prerequisites tables.
Microsoft Azure: Clarified Disaster Recovery and dev/test environment use rights for Extended Security Updates enabled by Azure Arc: Product terms now include a section titled ‘Disaster Recovery and Dev/Test Environments’ that states: “Customer may apply Extended Security Updates enabled by Azure Arc to the following OSEs for no additional cost:
a) When a customer has entitled Disaster Recovery OSEs associated with its underlying software licenses.
b) Development, test, and related OSEs licensed with Microsoft Developer edition licenses or Visual Studio subscriptions.”
Azure Active Directory Rebrand: Azure Active Directory (AAD) has undergone a rebranding and is now known as Microsoft Entra ID. To align with this change, all mentions of Azure Active Directory have been updated to refer to Microsoft Entra ID.
Glossary: Updated definition of ‘Previews’: Which now means preview, beta or other pre-release features, data centre locations and services offered by Microsoft for evaluation. Microsoft also added new definitions to support the Generative AI products and application of Microsoft’s Copilot Copyright Commitment. Including a Microsoft Generative AI Service that is identified as a ‘Copilot.’
Universal License Terms for Online Services: Additions and updates to terms that apply to all Generative AI products and applications of Microsoft’s Copilot Copyright Commitment. This extends Microsoft’s existing IP indemnification coverage to copyright claims relating to the use of our AI-powered Copilots, including the output they generate, specifically for paid versions of Microsoft commercial Copilot services and Bing Chat Enterprise. This includes Microsoft 365 Copilot which brings generative AI to Word, Excel, PowerPoint and more — enabling a user to reason across their data or turn a document into a presentation. It also includes GitHub Copilot, which enables developers to spend less time on rote coding, and more time on creating wholly new and transformative outputs. There are important conditions to this program, recognising there are potential ways that Microsoft technology could intentionally be misused to generate harmful content. To protect against this, customers must use the content filters and other safety systems built into the product and must not attempt to generate infringing materials, including not providing input to a Copilot service that the customer does not have appropriate rights to use. This new benefit doesn’t change Microsoft’s position that it does not claim any intellectual property rights in the outputs of its Copilot services.
As Microsoft license experts, we can help you demystify these and any other product changes and clarify what this could mean for your license position. If you have any questions relating to this or any other Microsoft licensing matter, please go to our website or contact us.
About the Author:
Karl is a Principal Licensing Consultant at Version 1, providing global Microsoft license expertise to organisations and ensuring customers get the best value from their Microsoft assets.
