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Terminal Services Licensing

I am sure that one of the most discussed topics on the Microsoft Public Newsgroups or Experts-Exchange regarding Terminal Services is licensing. And I can definitely see the reasons for that. Since TSE was out (remember, TSE is the old Windows NT 4.0 Server, Terminal Server Edition) people did not understand exactly how licensing worked. Then with Windows 2000 Microsoft not only changed the licensing a little bit but also introduced licensing enforcement...
To make things even more confusing different licensing options were introduced with Windows Server 2003 and old ones removed!

Yes, it seems confusing but if you read this section carefully I am sure you will understand how it works and will be able to figure out exactly what you need.

And before you ask me this question, Terminal Services is NOT a license saving solution or miracle; although you are installing applications on the server itself (i.e. Microsoft Office) what can mean a single machine (if you have a one server TS environment), this does NOT mean you will need only one single application license. Remember that multiple users will be able to access the application you just installed and therefore you must have as many licenses as needed to be legal. The savings you will have on a TS environment do NOT come from software licensing.

Another key thing to keep in mind is what your application EULA says about running it under Terminal Services. Certain applications may explicitly mention that running them under Terminal Services violates its EULA. So make sure you read the EULA for every single off-the-shelf application you intend to deploy under Terminal Services and in case of doubt, contact the manufacturer.

Requirements

For each client connecting to a Windows Server 2003 Terminal Server (“TS”), two licenses are required:

- Windows Server, Client Access License (CAL). A Windows Server 2003 Client Access License (CAL) is required for each user or device (or combination of both) that accesses or uses the server software. The same Windows Server 2003 Client Access License is used to access both Windows Server 2003 and Windows Server 2003 R2 servers.

- Windows Server, Terminal Services Client Access License (TSCAL). Terminal Server CALs are available in Per User/Per Device mode only. In Per User or Per Device mode, a separate TS CAL is required for each user or device that accesses or uses the server software on any server. You may reassign a TS CAL from one device to another device, or from one user to another user, provided the reassignment is made either (a) permanently away from the one device or user or (b) temporarily to accommodate the use of the TS CAL either by a loaner device, while a permanent device is out of service, or by a temporary worker, while a regular employee is absent. TS CALs are not available in Per Server mode as Windows sessions are not allowed in Per Server mode.

As you can see above, you must have two licenses in place for each user connecting to your TS: a CAL and a TSCAL. Usually the CAL is already in place in your company (as you need these to access any Windows Server you may have like a File Server, Print Server, etc) and are normally licensed per seat (although you can indeed license per server). Check with your network administrator what licenses you have in your company and if they are per seat or per server CALs.

The TSCAL is needed by any device or user connecting to a terminal server, regardless of the OS they have on their machine (i.e. Windows 2000 Professional, Windows XP Professional, Windows Vista, Mac OS X, Linux, etc). If you are deploying a Windows 2000 Server Terminal Server then things are a little different regarding the TSCALs. If your clients are Windows 2000 Professional or Windows XP Professional, no TSCALs are required. But in the other hand there is no such thing as per user TSCAL... Well, sounds confusing? Let’s explain the differences between Per User and Per Device TSCALs and why you should use one or the other.

Licensing Modes

With Windows Server 2003 Microsoft introduced Per User TSCALs and changed their policy regarding which Operating Systems (OSs) required a TSCAL.
The difference between Per User and Per Device, and figuring out which one to use, is easy to understand. As you know everyone or everything connecting to a TS requires a license (TSCAL). The question you need to ask is if you have more users than devices or the other way around.

For example, assuming you have 50 users in your company but they may access the TS from their office computers (50, assuming you have one workstation per user), their own laptops, their friends PCs, Internet Kiosks and so on it is easy to see they will be accessing from multiple devices and the total number of devices at the end will be higher than the number of users. If that is your case Per User licensing is the way to go (as you will need less TSCALs).

In the other hand if you have only 25 computers in the office that your 50 users share during two different shifts and you do not provide access to the TS from anywhere else, it is clear you have fewer devices than users so it makes more sense (financially) to have Per Device TSCALs.

Another difference to consider is licensing enforcement. When the TS is set to use Per Device licensing, this is actually enforced. Once a user connects to a TS, a temporary TSCAL is issued, valid for 90 days. After this license expires the TS will try to get a permanent TSCAL from the licensing server and if such license is not available the connection to the TS will be denied. When set to Per User licensing, such enforcement does not happen and users will still be able to work (meaning it is up to you to make sure you have enough licenses to be legal).

As you can see the best way to handle licensing is to determine before hand what you have; more users or more devices. Once you know this, simply set the TS to use such licensing option (we will show you how to do it).

ι There is also a special license called ‘External Connector License’. This is basically an unlimited license to be used for non-employee access (i.e. general public, suppliers, partners, etc). If you are setting up your Terminal Services environment for non-employee access, this may be the way to go.

Licensing Server setup

Regardless of the licensing mode you choose, a Terminal Services Licensing Server must be available on your environment, otherwise users may not be able to logon to your TSs.

But before we go ahead and setup a licensing server, note that this will not happen immediately; once terminal services is installed you have 120 days to setup your licensing server and once this is done you have up to 90 days to add any licenses to it (what you will need for sure if you choose ‘per device’ licensing; Again, when selecting ‘per user’ licensing, of course you are required to have all the licenses you need to be legal but licensing is NOT enforced in this case).

ι If you are not sure if TS is really the way to go in your particular case or if you need per device or per user licensing, use the 120 days grace period and wait to setup your licensing server; once that is done, you have another 90 days to determine the best licensing mode and if TS is indeed the way to go.

As this is a Windows Server 2003 environment your licensing server must be running on a Windows Server 2003 machine. If you still have Windows 2000 Server Terminal Servers still around, you can either use the new licensing server running on 2003 to handle Windows 2000 TSCALs (and of course the 2003 TSCALs) or simply keep the existing 2000 licensing server and setup a new one only for your 2003 Terminal Servers.

To install the licensing server on a Windows Server 2003 box follow these steps:

Logon to the machine as administrator and go to Control Panel | Add/Remove Programs | Windows Components and select ‘Terminal Server Licensing’ and click ‘Next’.

Fig. 9

Adding Terminal Server Licensing

Now you must decide if your licensing server (LS) will be an Enterprise License Server or a Domain License Server. The details on each are:
1. Enterprise License Server: first of all, an Enterprise LS cannot be installed on a stand-alone server; it must be installed on a domain controller or a member server in a domain. It is the right choice if your network has several domains and you want to maintain a single LS that will issue licenses to all TSs you may have on any domain.
2. Domain License Server: you can install a Domain License Server on a domain controller, a member server in a domain or a stand alone server. If you want to maintain a separate LS for each domain this is definitely the way to go.

Fig. 10

Licensing Server Mode

Select the appropriate one for your environment and click ‘Next’. You just installed your first licensing server! Now let’s activate it!

Activating your licensing server

Once your Licensing Server is installed and before adding any licenses we have an extra task to do: activate the Terminal Server Licensing server.

Click on Administrative Tools | Terminal Server Licensing. You should see your licensing server listed as ‘Not Activated’.

Fig. 11

Terminal Server Licensing

Right-click your LS and click ‘Activate Server’.

Fig. 12

Terminal Server Licensing Activation

The Activation Wizard screen will show up. Simply click ‘Next’.

Fig. 13

Activation Wizard

Select the Activation Method and click ‘Next’.

Fig. 14

Activation Method

In the following two screens, the Wizard will ask you some information (i.e. name, company, etc). Only the information on the first screen is mandatory. Type all that is required and click ‘Next’ on both screens.

Fig. 15

Activation Wizard - Mandatory Information

Fig. 16

Activation Wizard – Optional Information

If you see the following screen you are all set! In case there are any problems, make sure you have an internet connection and that port 443 is not blocked to the outside.

Fig. 17

Successful Activation

Adding licenses

The next step is to add licenses. Depending on how you get your licenses and on what agreement you may have in place with Microsoft, the actual licenses may differ. In certain cases it may be a 25 character code or simply an agreement number. Check with your company which agreement/licenses you have.

As an example, if you have a retail license pack, just follow these steps:

Launch Terminal Server Licensing. Your licensing server should be listed as ‘Activated’.

Fig. 18

Terminal Server Licensing

Right-click your LS and select ‘Install Licenses’.

Fig. 19

Installing TSCALs

The TSCAL Installation Wizard will come up.

Fig. 20

Licensing Server Mode

Select your license program and click ‘Next’.

Fig. 21

Licensing Server Mode

Depending on the program selected the wizard will ask you the product code or license agreement number to proceed. Enter it and click ‘Next’.

Fig. 22

Entering the license code

As explained before, depending on what you select on the first screen you may need to choose the licenses you want to install (i.e. Per Device TSCALs for Windows Server 2003) and then proceed to the final step. Once this is done your licenses will be shown on the Terminal Server Licensing window.

Fig. 23

Your license packs