DatabaseUnderstanding SQL Server Licensing

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Sometimes, buying software is simple. If you want a copy of a simple
HTML editor, for example, you just go to the vendor’s Web site, find out
how much it costs, fill out the online order form with your credit card
number, and download your copy. But as you start dealing with more complex
programs this simple model breaks down. By the time you get to an
enterprise application such as Microsoft SQL Server, the story is
immensely complicated. But if you’re responsible for buying SQL Server,
it’s important to understand the various options involved. Choosing the
wrong edition, or the wrong licensing scheme, could cost you thousands of
dollars that you didn’t have to spend.

How Many Editions Can You Name?

Let’s start with a relatively simple question: how many different
editions of SQL Server 2000 do you think there are to choose from? If you
said three, or four, or even five, guess again: there are actually eight!
Fortunately, if you’re planning for a server installation that will be
used in a production application by multiple clients, there are only three
editions that you need to consider:

  • SQL Server 2000 Enterprise Edition is the top of the heap. It
    supports up to 32 CPUs and 64GB of RAM (more on 64-bit systems) and
    includes features such as log shipping and OLAP partitions that are not
    available in other editions. It is also, naturally, the most
  • SQL Server 2000 Standard Edition supports up to 4 CPUs and 2GB of
    RAM. It includes Analysis Services, Full-Text Search, and the full suite
    of graphical administration tools.
  • SQL Server 2000 Workgroup Edition is the new kid on the block,
    just released in 2005. It supports up to 2 CPUs and 2GB of RAM, and
    doesn’t include OLAP features.

To judge which edition you need, you’ll have to think about both
features and capacity. First, have a look at the full list of Features by Edition to see which editions are suitable for your
applications. If you need Analysis Services, for example, Workgroup
Edition is out. Similarly, if distributed partitioned views are in your
plans, only Enterprise Edition will do. From there, you want to buy the
least-expensive edition that will do the job. This can be a bit tricky to
figure out, because the only SQL Server evaluation software is Enterprise
Edition. If you’re embarking on a large database project, you should pick
up a MSDN
, at the Professional level or up, which gives you copies
of all three editions for development and testing purposes.

Oh, and those other five editions? Just in case it comes up at your
next trivia game, they are:

  • SQL Server 2000 Personal Edition, a single-user version that’s
    included with SQL Server 2000 Standard or Enterprise edition and designed
    for mobile users who need to use data when they’re disconnected from the
  • SQL Server 2000 Evaluation Edition, which is Enterprise Edition
    time-bombed to stop working 120 days after it’s installed. You can
    order this on CD or download it for free from the Microsoft Web site.
  • SQL Server 2000 Windows CE Edition, a database that runs on the
    Pocket PC platform.
  • SQL Server 2000 Developer Edition, which has all the functionality
    of Enterprise Edition but is licensed for development only. If you’re
    a software developer, this is the edition you want to use to build
    products for your customers. You get it as part of your MSDN
    subscription, or with the higher-level versions of Visual Studio
  • SQL Server 2000 Desktop Edition, the successor
    to MSDE as a redistributable, embedded version of SQL Server.

Of Processors and CALs

But wait! You’re not done yet. After choosing your edition, you need to
decide which of three different licensing schemes you want to use for

  • Processor License: This is the simplest option. It is also the
    most expensive. You pay a flat rate for each CPU running SQL Server, and
    that’s it.
  • Server plus device CALs: CAL stands for Client Access License.
    Under this scheme, you pay one price for the computer running SQL Server
    (no matter how many CPUs it has) and a separate price for each device that
    accesses the data.
  • Server plus user CALs: Almost the same, but in this case you
    pay for the server plus you purchase a CAL for each user that
    accesses the data.

Bearing in mind that no one ever pays retail (discount pricing is
available through a variety of volume license plans and resellers), the
retail pricing can give you a good idea of the relative cost of these
various options. Per-processor licenses list at $19,999 for Enterprise,
$4,999 for Standard, and $3,899 for Workgroup. When you move to a CAL
model, it doesn’t matter whether you’re buying device or user
CALs. Enterprise server plus 25 CALs is $11,099; Standard with 10 CALs is
$2,249 and Workgroup with 10 CALs is $1,478. Standard and Enterprise CALs
are interchangeable, but Workgroup CALs can only be used with Workgroup
edition servers.

Whether it’s cheaper to go with processor licensing or CALs depends on
how many users your application will have. If you’re using SQL Server to
back a Web application, you probably don’t have any choice: unless you
want to buy a CAL for every user or computer that hits your Web site, you
need to purchase processor licenses. On the other hand, for internal
applications you may be better off with CALs if there are a limited number
of devices or users that will access the SQL Server. Choose device CALs if
you have multiple users sharing computers, or user CALs if you have users
who roam among multiple computers. Also, bear in mind that at a certain
point it’s cheaper to just buy processor licenses. For example, if you’re
running SQL Server 2000 Standard Edition on a single CPU, the cut-over
point is 24 users or devices; if you have more than that, it’s cheaper to
buy a processor license than to buy CALs. For SQL Server 2000 Enterprise
Edition on 4 CPUs, the cut-over point is 435 users or devices.

The fact that you can install multiple instances of SQL Server on the
same computer complicates things a bit. If you opt for the processor
licensing model, then one license fee covers as many instances as you want
to install. If you opt for the server plus CALs model, then one price
covers multiple instances only if you’ve purchased SQL Server 2000
Enterprise Edition. If you’re running Standard or Workgroup Edition under
the Server/CAL model, you need a separate license for each instance.

It’s All Going to Change

Well, not all. But some time before the end of the year, SQL
Server 2005 will ship, and this will have an impact on both the product
lineup and its pricing. First, SQL Server 2000 Desktop Edition is being
retired. In its place, we get SQL Server 2005 Express Edition. Express
Edition will still be free, embeddable, and redistributable. But unlike
Desktop Edition, it will include a graphical management tool, as well as
some other goodies like a report wizard and controls, plus support for new
technologies including SQL Service Broker and the Common Language Runtime.
All in all, Express Edition should significantly raise the bar for the use
of SQL Server is low-cost applications (and may be the death knell for the
venerable Jet engine).

Of course, the pricing is being changed for 2005 – which is a polite
way of saying that it’s going up. For SQL Server 2005, per-processor
licenses list at $24,999 for Enterprise,
$5,999 for Standard, and $3,899 for Workgroup (at least Workgroup isn’t
going up). Enterprise server plus 25 CALs will be $13,499; Standard with
10 CALs is $2,799 and Workgroup with 10 CALs is $1,478. Of course, you can
expect to see upgrade pricing that is much lower than this if you’ve got
existing SQL Server 2000 licenses.

The Devil is in the Details

Even though I’ve covered quite a bit of ground in this article, there
are plenty of other nuances to SQL Server licensing. For example, if
you’re running a commercial Web hosting service there are special pricing
plans just for you. If you’re purchasing via a volume licensing plan, you
can also buy Software Assurance, which in some circumstances guarantees
you an upgrade to the next version (though that depends on how soon the
next version comes out). When you’re ready to finally write the check for
your multi-thousand dollar SQL Server purchase, it’s a good idea to make
sure that you’ve made the right decisions. When you’re ready to buy, visit
the Microsoft
site. There you’ll find all the information you need to put
you in touch with a reseller who specializes in your own particular market
segment (government, educational, or business), and who should have people
on staff devoted to understanding the latest changes to the Microsoft
licensing model. Believe me, it’s a full-time job!

About the Author

Mike Gunderloy is the author of over 20 books and numerous articles on
development topics, and the lead developer for Larkware. Check out his latest books, Coder to Developer (from which this
article was partially adapted)and Developer to Designer, both from Sybex. When
he’s not writing code, Mike putters in the garden on his farm in eastern
Washington state.

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