MICROSOFT SERVICES PROVIDER LICENSE AGREEMENT
Regular volume license agreements enable you to buy
software licenses in bulk with steep discounts and deliver
them to your employees quickly.
But what happens when people need to use software but
they’re not your employees? Such as your customers or
affiliates? You need a Service Provider License Agreement
This can result in all sorts of license confusion, non-
compliance risks, and expensive audit penalties for your
My Pragmatic ITAM Method properly tracks these use cases
and ensures you don’t pay more than what you budgeted –
If you sell a service or benefit to customers that involves
Microsoft products, you’re considered a service
provider. So you’d better have a SPLA.
Controlling ownership in affiliates makes sense when
working on complicated lawsuits, mergers and
acquisitions or specialty medical offices. Sometimes, it
makes more sense to provide the IT services to your
But get hit by a license audit and your company could
be penalized for wrongly transferring software licenses
to the affiliate’s employees. And face enormous fines.
My Pragmatic ITAM Method minimizes this risk. So you
can sleep at night. Intrigued?
What Is SPLA & What Does SPLA Mean?
Two of the most common questions asked by newbies in the ITAM world are these:
“What is SPLA? and “What does SPLA mean?”
First, what is SPLA? SPLA is an acronym for Microsoft Services Provider License Agreement. It’s a specific type of software licensing agreement. SPLA licensing is used mainly by corporations and institutions that offer SAAS (software as a service) to their customers. It’s different than the bulk volume license agreement that covers the software your employees need to do their jobs.
What does SPLA mean? Microsoft SPLA was created so companies and institutions can allow third-party access to the software they purchase from Microsoft. It is managed month-to-month – you pay according to the number of people or entities that use it each month. This allows you to only pay for what you need.
But Microsoft SPLA lives in a kind of in-between state because there is no direct link between Microsoft and your end-users. This can cause all sorts of problems, confusion, non-compliance, and audits.
Microsoft SPLAs: Which Industries Are Most At Risk?
SPLA licensing is used by many industries, such as web hosting, gaming, and telecommunications companies. In fact, any organization that sells services or benefits to customers that involve Microsoft products is considered a service provider and must have a SPLA.
But the industries most impacted are legal, financial & healthcare entities. That’s because controlling ownership in affiliates makes sense when you work on complicated lawsuits, mergers, and acquisitions or if you need to connect specialty medical offices.
While sometimes, it can make more economic sense for your large company or institution to provide IT services to your smaller affiliates. If you get hit by a license audit, your company could be penalized for wrongly transferring software licenses to your affiliate’s employees.
Here are the questions you must ask to determine if you need a SPLA licensing agreement:
Do your customers’ smartphones read SQL Databases?
Does your company maintain exchange servers?
Do you generate graphic reports on Microsoft Sharepoint or Azure servers?
What Does SPLA Mean During Covid?
In the past, software licenses acquired through SPLA licensing for use by employees in a company or institution had few problems and weren’t often flagged in audits. However, due to the Covid pandemic, companies and institutions are facing new issues. The result is Microsoft SPLA customers find themselves faced with the kind of penalties they never had to deal with before.
What Is SPLA? Now you know!
Now that you have the answer to the question, “What Is SPLA?” I’d like to tell you how your company or institution can avoid the many pitfalls of SPLA licensing:
During the past 20 years, I’ve perfected a unique ITAM methodology called the Pragmatic ITAM Method. If your company or institution depends on bulk volume license agreements, my method enables you to track use-cases and trust your reporting. So you only pay for what you need.
Hire me for a short-term engagement, typically about nine months, during which I’ll investigate your environment and get things set up correctly using tools you already have but are not using or not using correctly. Then I design a solution based upon your needs and implement it as I stand shoulder to shoulder with your existing team. I teach them hands-on best practices and tricks of the trade, so they’re thoroughly prepared to take over when I leave.
Pragmatic ITAM helps you avoid the kind of audits and penalties that can be devastating to your bottom line – using the tools and team you already have. Want to find out more?