Windows Server licensing confuses a lot of buyers, and getting it wrong means either overpaying or being under-licensed during an audit. The good news is that for most offices it comes down to three questions. This guide covers Windows Server 2022 and 2025 Standard and Datacenter.
Licensing rules are set by Microsoft and can change. Always confirm your exact requirement before buying. We are happy to check it for you.
1. Core licences: licensing the server
Windows Server Standard and Datacenter are licensed per physical processor core in the server, not per server. The key rules:
- Every physical core in the server must be licensed.
- There is a minimum of 8 core licences per processor and 16 core licences per server, even if the server has fewer cores.
- Core licences are commonly sold in packs (for example 2-core and 16-core packs).
Example: a server with one 10-core processor needs 16 core licences (the server minimum). A server with two 12-core processors has 24 cores, so it needs 24 core licences.
Standard or Datacenter?
The difference is mainly virtualisation rights:
- Standard: when all physical cores are licensed, you can run up to 2 virtual machines (operating system environments) with Windows Server. Licensing all cores again adds 2 more VMs.
- Datacenter: when all physical cores are licensed, you can run unlimited Windows Server VMs on that server.
For a typical small office running one or two servers' worth of roles, Standard is usually enough. Datacenter makes sense for heavily virtualised hosts.
2. CALs: licensing the users or devices
A Client Access Licence (CAL) gives a user or device the right to access Windows Server, for example to log in to the domain, use file shares or print. In most setups, CALs are needed in addition to core licences. You choose between:
- User CALs: one per person, whatever devices they use. Best when staff use several devices (PC, laptop, phone).
- Device CALs: one per device, whoever uses it. Best for shared devices, such as shift workers sharing PCs.
CALs must match or be newer than the server version you are accessing.
3. RDS CALs: for remote desktop users
If users connect to the server through Remote Desktop Services, for example to run Tally or another application on the server, each user or device also needs an RDS CAL, on top of the normal Windows Server CAL. RDS CALs also come in User and Device types.
Note: two simultaneous remote sessions for administration are allowed without RDS CALs. RDS CALs are for users working on the server.
Physical, digital and OEM licences
Licences can be supplied in different formats: physical, digital, or OEM (generally tied to the server it was bought with). OEM licences can be cost-effective with a new server but usually cannot be moved to another machine. See our OEM licence terms.
A quick checklist before you buy
- How many physical processors and cores does the server have?
- How many Windows Server VMs will run on it?
- How many users or devices will access it?
- Will anyone use Remote Desktop to run applications on it?
Send us these four answers and we will work out exactly what you need.
Quick answers
How many core licences do I need for Windows Server? +
All physical cores must be licensed, with a minimum of 8 per processor and 16 per server. A server with one 8-core processor still needs 16 core licences.
Do I need CALs for Windows Server? +
In most setups, yes. Each user or device that accesses the server needs a Windows Server CAL, in addition to the core licences.
What is the difference between a CAL and an RDS CAL? +
A CAL allows access to Windows Server services such as file sharing and login. An RDS CAL is additionally needed for users who work on the server through Remote Desktop Services.
Need Windows Server licences? We help you size the licences and supply them with GST invoice.