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Get into the groove of Office 365 licensing for VDI

Virtual desktops change the traditional licensing game. Office 365 typically allows for five device installs, but the rules are different in an Office 365 VDI deployment.

Office 365 licensing can make IT administrators sweat more than someone wearing a parka on a beach in August. Adding VDI to the mix is like tacking on a ski cap, scarf and mittens.

VDI makes Office 365 licensing more uncomfortable because the typical licensing rules change. In physical desktop deployments, admins can pick between two types of Office 365 licensing: Business and Enterprise. Business licensing does not allow for shared use, however. As a result, VDI shops must use any of the Enterprise licensing models that include Shared Computer Activation mode, which include Office ProPlus, E3 and E5, to deliver Office 365 to their users.

Beyond this distinction, some businesses may want to use nonpersistent virtual desktops -- where users are randomly assigned desktops each time they log in. For others, persistent virtual desktops -- where each user has his own personal desktop -- work best. Depending on which approach VDI shops choose, licensing for Office 365 works a little differently.

What is Office 365?

Office 365 is a subscription-based cloud service IT shops can use in place of traditional Microsoft Office software. It includes Office, Exchange Online, SharePoint Online, Lync Online and Microsoft Office Web Apps. With Office 365, IT no longer needs to worry about maintenance tasks, such as patching, or deal with infrastructure adjustments. Microsoft handles the back end instead, leaving IT free to add new users and control Office 365 features and tools.

Desktops and mobile devices are rapidly merging under Microsoft Office's 365 strategy

While the roadmap for Microsoft's Office 365 strategy is still shaking out, there is little doubt that it is cloud-first and mobile-first. But how well is that strategy working? Check out this podcast to find out.

How does Office 365 licensing generally work?

Office 365 offers similar options as the on-premises Microsoft Office, but subscribers have the choice of paying monthly or annual fees instead of buying the software license outright. The subscription-based Office 365 licensing approach gives IT admins the ability to pick and choose software and services. The downside is that if IT cancels a user's license, all the data saved in that Office 365 user profile is deleted as well. Businesses can adjust their licensing plan on a month-to-month basis. Certain Office 365 subscriptions have limits on how many users or how many devices work per license. Office 365 Business, for example, only allows up to 300 end users.

One problem with the subscription model for companies is fluctuation. Many businesses overestimate the number of licenses they need on a monthly basis, which causes costs to spike. Others underestimate the total, restricting workers' capabilities.

Office 365 licensing in VDI requires a few workarounds.

Companies deciding on Office 365 or the latest Microsoft Office should be aware that, beginning in October 2020, organizations with Office 2010, 2013 and 2016 can no longer use the business versions of Microsoft Outlook, Skype or OneDrive without an Office 365 subscription.

Why do VDI shops need Office ProPlus?

Office 365 licensing in VDI requires a few workarounds. It is important to understand that Microsoft likes to assign licenses per user, allowing each user to access five devices. This is not a problem for a persistent virtual desktop deployment because users are assigned one license and may access their desktops on up to five devices. For a company that has multiple users working with a single desktop, as in nonpersistent deployments, this type of licensing is not viable.

This is why a company needs Office ProPlus for nonpersistent VDI licensing. Office ProPlus activation has two settings: Shared Computer Activation mode or Not Shared. For nonpersistent VDI deployments, Office ProPlus is shared, allowing the desktop to hold the license rather than the user. This gives room for multiple accounts to work on the same desktop. Persistent VDI deployments that use Office ProPlus are not in shared mode.

The one exception is when persistent desktop deployments use Microsoft Remote Desktop Services (RDS). RDS delivers remote Windows desktops and applications, meaning users share a virtual machine and often access the desktops from multiple devices for a temporary amount of time. All RDS deployments must use the Shared Computer Activation mode because it makes per-user Office 365 licensing temporary whenever users sign into their accounts. Because it is a temporary activation, it does not count against the five device licensing rule, allowing users to work from any device they choose.

Next Steps

How to migrate to Office 365

Compare Office 365 to Apps for Work

Microsoft 2016 goes up against Office 365

This was last published in June 2017

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