From 1. 1. 2018 we will be 100% opensource


After about 7 years of cooperation with Microsoft, we have decided to take a decisive step and end as an SPLA partner. As of January 2018, we will no longer offer Windows and other Microsoft product license rentals.

Supplement 15. 9. 2017 at 17:30: We are addressing the situation and it affects a small proportion of our clients and we are addressing it primarily with them because it affects them directly. So we are dealing with current clients. How we do it and how it will be in the future will be decided afterwards.

Today we celebrate 7. birthday, and we got each other a present. We had to decide how to proceed with licensing Microsoft products on virtual and dedicated servers. We made a big decision. Really big. We have decided that from 1. January 2018, we will no longer be SPLA partners with Microsoft and so will no longer be able to lease licenses to our customers.

Until now, we have been renting Microsoft product licenses to our customers. This will not be possible from January 2018.

We understand that this is a big complication for our existing customers, but we will try to explain why our decision is the right one and ultimately better for our clients. We are not only dealing with virtualization, but also with dedicated servers, so the procedures described below are general and cannot be applied to all services.


The price comes first. We are currently in a situation where operating system licenses on 1 server would cost us about 3 times more than the hardware we use. Frankly, we think it’s a lot and we decided to go the opensource route. Currently, this would mean that we would have to increase the prices of our current services significantly (up to many times).

The other side is that more and more often (you – the customers) demand the possibility to install your own licenses. In the current system, when we are under SPLA contract, this was not possible. Our contract with Microsoft prohibited us from letting our clients install their own operating systems or programs from Microsoft, even though they had legally purchased them. We believe that the number of clients who wanted to install their own operating system, which they had purchased somewhere, has gradually outnumbered those who wanted to rent from us. Installing your own license on a dedicated server should not be a problem in most cases.

At the same time, we want to launch the WEDOS Cloud service in the next few days, where you will be able to order a VPS according to your own parameters and you will only pay for the actual resources used. You will be able to build your own private network, your own balancers, your own virtual server environment… And that’s where Windows licensing just doesn’t work out in terms of price anymore. We’re not talking about triple anymore, we’re talking about multiples… Our environment is multi-platform and we and our clients use different operating systems and with WEDOS Cloud we would not be able to keep track of where and how what is installed (although our existing contract with Microsoft requires us to keep track of this). Because of this, we would have to pay for all servers, even those where Windows is not running or are “put to sleep” within the new WEDOS Cloud service (and the customer does not pay for them). That would be economic suicide.

How does it work now?

We currently have a special agreement with Microsoft (we are a so-called SPLA partner) and we rent licenses to our clients and we have paid (and are paying) a monthly fee for each use. For operating systems, licences were calculated by physical processors. It was simple. We ran VPS with Windows on dedicated servers and for these servers we calculated how many processors they have and we paid a monthly fee for them. Simple.

The price was the same for a server with a weak processor as for a server with a strong processor. Regardless of the number of cores and threads.

In order to offer our customers the cheapest licenses, we have been buying servers with many cores (threads) all the time. Simply powerful processors (in the order of one processor for 60 thousand crowns or more). Thanks to this, we were able to have more customers on one server and thus reduce the price per license for an individual customer to an unbeatable minimum, or in our case to one VPS module.

For databases or remote desktop licenses it was a bit different (somewhere the license was per user, somewhere per processor, etc.), but the principle was similar.

Microsoft has now switched to licensing per processor core. So our current system is suddenly extremely disadvantageous. In addition, the price has gone up. This again makes it more disadvantageous. We admit that at the same time we are switching to other hardware that has processors with fewer cores but high performance (3.8 GHz frequency). In real terms, this means for us that the price has gone up to about 6 times the price.

Or should we increase the price many times over for our clients? We have no margin on rentals. We did it as an additional service to virtual servers and therefore we have no room to solve the multiple price increases in any other way. Either we make across the board multiple increases in all services going forward plus all our existing clients from a certain date OR we make a move similar to what we are describing now. We gain freedom for us and our clients and ultimately save money (for us and our clients).

Example of price calculation:

Existing servers with multiple CPU cores:

  • per CORE licensing new

2CPU of 10core = 10 x 9EA-00039 (2 core in package) = 273 EUR / month
Cost per VPS module = 2,87 EUR

  • licensing per CPU old

2CPUs of 10 core = 2 x P71-01031 = 212 EUR / month
Cost per VPS module = 2,23 EUR

You can see that there is an increase of 29%.

New servers with fewer CPU cores and higher frequency (higher performance):

  • per CORE licensing new

1CPU by 4 core = 4x 9EA-00039 (at least 8 core) = 109 EUR / month
Cost per VPS module = 13,62 EUR

  • licensing per CPU old

1CPU by 4 core = 1x P71-01031 = 106 EUR / month
Cost per VPS module = 13,25 EUR

Conclusion of the calculation:

Old and new licensing is disadvantageous in this case and you can see that the price for 1 VPS module would cost us about 6 times more than before. So in our case we are talking about a 594% increase in costs. This is an increase that is unbearable. If we compare the current prices on the current servers and the new prices on the new servers, there is an increase of 610%. Since we will have to license all servers gradually according to the new conditions, there will be this major difference.

The situation will be even worse for WEDOS Cloud. Now we are able to determine that we have Windows only on selected servers and we pay licenses for these servers (several million crowns annually). With WEDOS Cloud we will offer a fully unlimited solution where you can have different special settings (and everything will be managed by the customer) and we will not be able to deal with limitations on selected servers and we would have to pay licenses for all servers. Yet the number of Windows servers is now below 10%. The result is that we would have to pay for 90% of the servers unnecessarily and even new ones (higher prices), which is unaffordable and completely uninteresting for clients and economically senseless. Of course, we can limit it to selected servers, but we won’t be able to ensure 100% utilization within the cloud, so we will have to increase the price as a reserve to pay for licenses even on less utilized servers. If we want services with high availability and full redundancy in 2 datacenters, we would have to deal with licenses in a copy of the second datacenter… So twice as much nonsense… Not to mention that with WEDOS Cloud you will be able to put individual VPS to sleep and not pay for them. But it would have to be for licenses. Uh… Three times the nonsense.

That’s why we’ve been so dramatic.Proliant 380d (40 thread – 380GB RAM)per CORE licensing new2CPU of 10core = 10 x 9EA-00039 (2 core in package) = 273 EUR / monthCost per 30GB HDD, 4GB RAM, 1vcpu = 2,87 EURlicensing per CPU old2CPUs of 10 core = 2 x P71-01031 = 212 EUR / monthCost per 30GB HDD, 4GB RAM, 1vcpu = 2,23 EURMoonshot (8 thread – 32GB RAM)per CORE licensing new1CPU by 4 core = 4x 9EA-00039 (at least 8 core) = 109 EUR / monthCost per 30GB HDD, 4GB RAM, 1vcpu = 13,62 EURlicensing per CPU old1CPU by 4 core = 1x P71-01031 = 106 EUR / monthCost per 30GB HDD, 4GB RAM, 1vcpu = 13,25 EUR

How will it work?

Any customer who wants to use Microsoft programs will have to provide their own licenses and install everything themselves and will be responsible for its legality. The customer will be responsible for the legality of the correct and appropriate license. For dedicated servers this is no problem. With virtual ones it is more complicated, but one alternative is to offer customers a dedicated server instead of a virtual one or to sell it to them directly.

No one will be limited by having to install only what we have on offer. No one will have to wait for our steps for setup or installation. Just freedom and speed.

We believe that you will now argue that we should run everything on existing servers and just raise the price by 29% and new clients on WEDOS Cloud or new virtual servers . But there’s a catch. According to the contract, we are not allowed to operate servers that do not use the licenses provided by us (except for special software asurance licenses – mobility licenses). So it is not possible to have some hybrid model. I’m sorry. So either we will make our current clients 29% more expensive and the new ones 600 or more (more likely several thousand) percent more expensive (and thus our services will be completely unsaleable)… OR we take the step we are now describing.

What will this bring for clients?

Savings. Significant savings. Clients will not pay the prices that have now gone up, but will be able to buy their own licence (for example, anywhere on the internet). They pay a one-off payment of a few hundred crowns to a few thousand crowns and pay nothing per month.

Possibility to use your own licenses. If you have your own legal license that you are not using, you will be able to install it with us. The customer will be responsible for the correct licensing of each product.

Greater flexibility. Without waiting for our actions or approval and intervention from us.

How do we do all this?

It’s all very challenging. Especially for the several hundred existing clients who now have licenses leased from us.

We will send a detailed scenario to our clients and we will gradually “fine-tune” everything together with our clients. All clients will be contacted by email. We’ll work through this in detail with everyone. Currently, we have had to stop new orders for Windows rentals because it is unreasonable to let us set up services for other clients and then terminate their services in 3.5 months.

The anticipated end date of the licence option is 31. 12. 2017. If this date does not change, we have about 3.5 months to resolve with our clients. If this deadline is maintained, we will send several notices to clients and during October we will terminate the specific services where they have leased Microsoft licenses. The services will be operational until the end of 2017.

Clients will then get a second VPS or a dedicated server from us for free in time, where they will be able to prepare and set up everything in a new way, because from 1. 1. 2018, we would have to shut down all existing servers uncompromisingly. We will provide all new VPS to clients for the period of the move (and subsequent debugging) completely free of charge and then under significantly discounted conditions (we are considering a 50% discount for at least one year) to compensate clients for the laboriousness of the necessary adjustments. Clients save money on license rentals and server rentals at the same time.
For dedicated servers, this is no problem with custom customer licenses. With virtual servers, one option may be to give clients a dedicated server at a bargain price. We are addressing the situation and it is not closed.

What could possibly move the deadline? We’ll see in the next few days when we have reactions from clients.