How to know whether to bring your own or convert to cloud native licenses

When it comes to cloud hosting, you have a lot of decisions to make. One of the most important is whether you will bring your own licenses to the cloud (BYOL), or use the cloud licenses included with cloud VMs (cloud natives).


Microsoft Windows & SQL Licenses

There are five main licensing options available to you, each with different perks and costs. For example, you can save up to 40% on Azure cloud VMs if you bring your own Microsoft license to Azure. But, if you use cloud native licenses, you don’t need to worry about license management and compliance on non-Azure clouds.


Red Hat Licenses

With Red Hat Enterprise Linux licenses, the benefit is that you work with your Red Hat representative and pay for cloud VMs and licenses separately. When you use the Red Hat cloud native, licenses are included with the VM on all clouds.


Oracle Database Licenses

Oracle Database licenses are easiest to convert to Oracle Cloud. AWS and IBM do allow you to bring your own Oracle license, but it is much more expensive than converting to their respective cloud native licenses. Like Microsoft, Oracle offers license mobility so you can move Oracle licenses between on-premises and cloud more freely if you use Oracle cloud.

Another option is VMware–it also allows for BYOL and many clouds, including AWS, Azure, and IBM, support it.


BYOL versus Cloud Native Licenses

Since every cloud environment is different, there’s no one-size-fits-all solution. BYOL is often best used with dedicated hosts in the cloud. Dedicated hosts are cloud instances where the underlying hardware is dedicated to a single tenant and not shared with any other cloud customer. It is used with BYOL because it leverages how on-premises software licenses are structured–including per CPU, per socket, and by memory size.





A major downside of BYOL is that you have limited uptime management. You are charged for a dedicated host (or bare metal cloud) as long as you have it allocated to you. Therefore, unlike multi-tenant hosts, you can’t manage costs by managing your VM uptime. Because of this, you could be missing out on up to 30% in savings.





In both BYOL and cloud native licenses, you must right-size to maximize your savings. Modeling and analyzing your cloud costs is vital to maximize savings in the cloud. Many on-premises servers are under-utilized, meaning there is room to downsize the cloud server or pack more into a larger server. Both options produce cost savings without sacrificing performance.



Another factor to consider with BYOL is that license compliance is your responsibility. Every time you spin up a VM with any BYOL software license, you have to ensure you are not in violation of software licensing terms.

Some clouds like AWS offer a service (i.e. license manager) to help you with this effort, but ultimately it is your responsibility to maintain license compliance. Don’t forget to account for these time and management costs!


The Importance of Modeling

Modeling the benefits of BYOL versus cloud native licensing on each cloud you’re considering is necessary for the best value on each cloud you’re considering. However, this process is tedious and time consuming. Akasia Cloud Modeler is a SaaS solution that gives cost comparisons between 5 cloud platforms at a granular, service-by-service level. It is the perfect solution for assessing cloud costs for new cloud-based application projects, and helping you choose the most cost-effective provider.

Choosing whether to bring your own license or convert to cloud native licenses is an important decision to make as you migrate your data to the cloud. If you do cost modeling and run all scenarios for each cloud you’re considering, you can use this data to negotiate cloud pricing. Weighing the pros and cons of each option and modeling your cloud options is necessary to ensure you are getting the best deal possible.


You can learn more about how Akasia can help you choose between bringing your own license and switching to a cloud native license in our free infographic.