What is SPLA?
SPLA is a three-year agreement that can be canceled at any time. You true up and down on a monthly basis, all reporting is done in the arrears. As an example, if you have 10 users of Office in the month of November, you will report those 10 users by December 10th. As part of your signed SPLA agreement, you are required to report no later than the 10th of each month for the previous month’s usage.
Why SPLA?
SPLA is for any organization that provides software as a service to end users. All other licensing programs prohibits commercial hosting. Top questions to ask:
Who benefits from this access? If you are a bank and you provide end users access to your platform to upload financial data to obtain a mortgage, the benefit of that access is to your bank. (They are selling the mortgage to you).
If your healthcare organization who provides access to an EMR software to other healthcare clinics (who are two separate organizations and do not share ownership) and they provide that solution to their patients, that is also SPLA. The benefit of that access is for the third-party healthcare clinics to administer their patients.
Do you charge users for this access? Microsoft does not care if you charge for the service or not to determine if you should be SPLA or not, but usually an organization would only charge for a solution if they were providing some sort of value back to the end users.
Do you provide DR Services? If you provide desktop as a service, that also must be SPLA. You are providing this as a service for another organization.
Are you hosting this on behalf of another organization? Any time you host an application for another organization, that is SPLA.
Key Take Away
As yourself who benefits from this access – your organization or your customer? Any time you provide “As a Service” SPLA must be part of the conversation.
SPLA Agreement Language
SPLA Enrollment Number
Your SPLA enrollment number is 86529543. This number is very important to keep for your records. Whenever you talk to Microsoft or contact the VLSC website to download media, they will ask for this number. This number is also very important for activating RDS. There is no license key with RDS, you will enter your 86529543 number instead of a license key.
SPLA Terms and Conditions
SPLA Internal Use
Per the SPLA Indirect Agreement (April:2017 page 5) a Service Provider can use SPLA licenses for internal as long as the following conditions are met
- Internal use. Customer may use Products for its internal use, so long as:
- Customer reports such use in its monthly use report and pays for this use;
- Customer’s use is less than 50% of the total use of such Products by all of its End Users (calculated on a Product-by-Product basis) each month; and
- the SPUR does not restrict internal use for the Product at issue.
Internal use means employees of your organization The licenses are not free, it simply means instead of paying for these licenses through a volume licensing agreement, you can pay for them for SPLA. Your internal license count cannot be more than 49% of what you are hosting. To provide an example, if you license to external user 10 licenses of Office, you can license up to 4 (less than 50%) internally. Instead of reporting just the 10 users you are hosting under SPLA, you would report a total of 14. (4 internally and 10 externally). This usage count is on a product-by-product basis.
This use right is not for everyone, in most cases purchasing a volume licensing agreement is more cost-effective for internal users. There is also compliance risk because you must maintain less than 49% internal consumption and is just another thing to track. Licensing SPLA for internal use can benefit if you have seasonal employees or inconsistent user counts internally.
End User Facility Installation
Per the SPLA Indirect Agreement (April:2017 page 5) a Service Provider can install SPLA products on hardware that is not owned by your organization (the SPLA provider). Key
End User Facility installations. Customer may locate servers containing Products (“Servers”) on an End User’s premises (“End User Facility”) solely to provide Software Services to the End User, provided that the Servers remain under the day to day management and control of the Customer.
SmartITPro can install SPLA on hardware they do not own as long as they have complete manage of the server. In other words, the only access your end users should have to the servers is to access the software. As an example, if you install an Excahnge Server on their premise, the only access the end user should have to the server is to access email. They should not be providing maintenance, installation, or any other related activity.
End User Demonstration
Per the SPLA Indirect Agreement (April:2017 page 6) a Service Provider can provide demonstrations to their end users without having to report/license it on a monthly basis.
End User demonstrations. Customer may demonstrate its Software Services to prospective End Users so long as such demonstration is consistent with the SPUR. Customer may have up to fifty (50) active user IDs for demonstration purposes
The purpose of this clause is to be able to demonstrate your solution works to your prospects, not production. Best practice is to label “Demo Account” in your Active Directory. Whenever you are audited, you must prove why you are licensing the way you are licensing. Having it labeled correctly in your AD will eliminate any description and makes it easier to prove during an audit.
End User Trials
Per the SPLA Indirect Agreement (April:2017 page 6) a Service Provider can provide demonstrations to their end users without having to report/license it on a monthly basis.
End User evaluations. Customer may use the Products to provide Software Services on a trial basis to its End Users if the following conditions are met:
- the sole purpose of the trial is for the End Users’ evaluation of the Software Services;
- the trial is not longer than sixty (60) days for any given End User;
- the SPUR does not restrict such use;
- Customer has entered into End User Agreements with the End Users; and
- Customer does not charge or receive any fee or benefit from the End Users from the trial.
The purpose of this clause is to be able to provide “free trials” for your end users. Demonstration (mentioned previously) is for your sellers to be able to show your solution to your end users. End User Evaluations is providing free access for your end users to use the software themselves, not just demonstrate the services.
Key things to remember is the trial cannot last more than 60 days, but it is per given user (not organization). As your customer adds additional users, you can offer this free of charge to each individual user for 60 days. Most service providers can mistakenly believe it is for each organization, but it is per user as highlighted above.
Best practice is to label “Evaluation” in your Active Directory. Whenever you are audited, you must prove why you are licensing the way you are licensing. Having it labeled correctly in your AD will eliminate any description and makes it easier to prove during an audit. Please keep in mind this is only for 60 days. If you do an internal audit and realize you did not report a user correctly, best practice would be to leverage the 60 day clause.
End User License Terms
As a service provider, you more than likely have agreements with each of your customers. As part of your agreement, you must include the End User License Terms which are part of your SPLA agreement. This document includes language on how the end user can access and use the software that you deploy. It is very important to include this document. Most service providers either include this document as part of their overall agreement with their customer or post it on their website as a click to accept.
