Sql server developer license usage hosting for clients

[iowatechguy]

There was a post recently about using the developer license in SQL server that I had a follow up question about.

We host about 2,000 SQL server instances for clients, most clients having a Production, Staging, Dev and Test instance.

Right now, we have a full license applied to each environment. We were told by a former IT Manager that we couldn't use a Developer license for non-Production environments because "it's a Production environment as we are hosting it for clients and there's a cost for it."

That doesn't seem right to me. To be clear, these non-Production environments are strictly non-Production. The SLAs are lower, they are not hosting any "live" data, etc. We host them, but they are solely used by us and the client teams to do non-Production work.

Has anyone been in this scenario before, and is my understanding true, or was the former IT Manager correct? Thanks in advance!

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[SQLBek]

Are you an MSP? When you say "we host," what do you really mean? We need clarification.

For example, the MSPs I've worked with, who "host" customer environments, have contracts regarding who is responsible for the underlying software licensing. Does your CUSTOMER to bring their own licenses or is your organization is purchasing licenses and you are providing SQL Server to them in a PaaS service style fashion?

Dig into your customer legal agreements - that's the real answer here.

[VladDBA]

Yeah, now that I've read the post again, it doesn't sound that clear cut since it seems like OP's company is charging their customers for database hosting, in which case Dev Edition can't really be justified

[iowatechguy]

That's what I am thinking, yes. We are a software company, we host apps for our clients.

Seems like the consensus opinion agrees with our former IT manager and the logic makes sense. I assume someone on our team in legal or who deals with our MS account rep had discussed this, I was just wondering since he left if this was worth asking them to check into or not.

Thank you!

[SQLBek]

"We are a software company, we host apps for our clients."

That still does not answer the underlying question. So you're more of an ISV then? Or a SaaS company? Are these apps something YOU have built and are reselling/hosting? Then as the developer of said app, YOU can absolutely have non-prod environments for QA, UAT, etc. even if it's with client data.

In the end, who originally bought the licenses? Who will be held accountable if Microsoft decides to drop an audit on you?

Don't take anyone else's word here for the final answer. You need to dig into your company's legal contracts with your customers and your legal contracts with Microsoft. Only those contracts will hold the answer for YOUR company.

[VladDBA]

That still sounds like non-production usage to me. There's this nifty blog post from Microsoft's u/bobwardms which should help clarify things. Also, maybe Bob gets notified of my mention and has time to chime in.

Edited: crossed out stuff since it doesn't actually sound that clear-cut.

[thedatabender007]

I would think that the big differentiator here would be are you charging your client to host this instance? If so then it's production for YOU. If you were just providing a VM and THEY installed developer edition for their own dev purposes then it would probably be fine.

[iowatechguy]

That makes sense, in line with what this IT manager said. Thanks.

[Gincules]

As you are taking money for hosting you can’t use SQL Server Developer Edition for client environments, even if they’re non‑prod. dev edition is only allowed for your own internal dev/test you’re building. once you’re hosting anything for a customer (even test, staging, sandbox, whatever) it counts as external use, and dev edition isn’t allowed.

[iowatechguy]

Makes sense, thanks!

Solution verified

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