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SQL Server deal portends problems with AWS BYOL approach

A BYOL approach gives enterprises flexibility with their cloud vendors, but be sure to have an exit strategy in case any licensing agreements come to end.

As competition heats up in the cloud market, enterprises need to be especially careful when they move applications with existing licensing agreements off premises.

Many users host Windows productivity applications on the AWS public cloud. These companies follow a bring-your-own-license (BYOL) model, where they run their Microsoft software on a non-Microsoft platform, while AWS maintains the Microsoft license compliance.

Enterprises have the same option with many other software vendors, including Oracle. While it may sound confusing, an AWS BYOL approach provides flexibility. Enterprises aren't forced to use a public cloud provider's native software, so they can mix and match applications to meet their exact needs.

However, cloud computing providers and software providers must have agreements in place for these types of BYOL agreements to work. As we've learned in the past, deals can be canceled or changed, and the cloud users end up holding the bag.

Microsoft ends AWS BYOL agreement for SQL Server

For example, the BYOL option for Amazon Relational Database Service (RDS) for SQL Server recently ended. Enterprises that license SQL Server under volume licensing now must pay through the License-Included option in RDS, migrate to EC2 as an independent instance, or move their workloads and data to Azure. This notice went to all Amazon RDS for SQL Server users who currently use the BYOL program.

AWS confirmed that current Amazon RDS for SQL Server users who rely on BYOLs as part of a License Mobility program between the two are eligible to continue with the AWS BYOL approach until June 30, 2019. Still, the clock is ticking, and new Amazon RDS for SQL Server customers appear to be out of luck as well.

If an enterprise does use a BYOL approach, it needs an egress plan.

Some enterprises will be angry at this change, which isn't believed to impact any other Microsoft applications under the Licensing Mobility program. But this type of breakup will become more common in the next few years, as existing agreements expire and cloud computing becomes more pervasive. The same scenario played out when networks became pervasive and it was suddenly easier to share software. Licensing approaches changed and changed again until the enterprise software players found the most profitable way to do it.

Privately, the top public cloud providers would likely blame each other for this situation, but it's the nature of these forced marriages that leads to their eventual ends. These types of arrangements are likely to go south, given the business model complexities and cloud providers' evolving objectives with BYOL software providers.

Guard against AWS BYOL breakups

So, how can you protect your enterprise if your AWS BYOL agreements come to end?  

First, BYOLs are typically not a good idea unless there is a compelling business or technology goal. Companies that go that route use non-native enterprise software on separate cloud providers, while there are often much better native alternatives. This could even mean the data or workloads stay on premises until they can find a good native analog.

Second, if an enterprise does use a BYOL approach, it needs an egress plan. The IT team needs to prepare for the day when these agreements expire or change, and let cloud and software providers rearrange furniture around them. Companies can conduct a simple risk-planning operation by which they weigh the likelihood that they'll need to act on that egress plan and factor it into their long-term costs.

An enterprise has no power to influence those changes, but it can put plans in place to minimize the cost and disruption.

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