Chris Badenhorst, Head of Azure Core Services at Braintree
Software licensing has become more complex and more expensive. Many organisations now sit at a point where their technology costs are rising faster than the value they get from their systems.
Over the past year, I have seen licensing models and costs change rapidly. If businesses do not modernise and actively manage their licensing, they risk falling into an expensive cycle that limits growth and innovation.
Why licensing complexity is increasing
Organisations are dealing with several pressures at once:
- Rapid shifts in technology
- Growing governance and compliance demands
- Increased focus on cost control
- The rise of AI-driven infrastructure
These factors are forcing businesses to rethink how they approach licensing. What worked a few years ago no longer fits today’s environment.
Modernisation challenges are driving costs
In many cases, companies are still running on legacy systems. These include on-premises infrastructure and older licensing models such as volume licensing.
I often see environments where:
- Data is fragmented
- Architectures are inefficient
- Costs are high
- Innovation is limited
When organisations try to build on top of these systems, they run into structural challenges that slow progress and increase expenditure.
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How Microsoft’s changes are reshaping licensing
Microsoft has made significant changes across Azure and SQL platforms.
From my perspective, these updates are designed to simplify licensing while supporting modern workloads. There is a clear shift toward AI-ready infrastructure and integrated data platforms.
With technologies like Copilot and evolving cloud services, licensing is now closely tied to how businesses adopt AI and manage their data.
What SQL Server 2025 means for organisations
SQL Server 2025 introduces changes that improve the economics of modernisation.
If organisations optimise their licensing and architecture now, they can build long-term efficiencies.
This includes:
- Better cost alignment across hybrid environments
- Clearer licensing structures
- Stronger support for both cloud and on-prem systems
Governance and security are now central
Licensing decisions are no longer separate from governance.
Azure has strengthened its capabilities with:
- Improved policy management
- Built-in security and observability
- Enhanced identity control through Entra ID Governance
These tools give organisations better visibility and control over their environments.
The shift to pay-as-you-go models
One of the most important changes I see is the move toward pay-as-you-go licensing.
For example, Windows Server 2025 introduces more flexible licensing options that allow businesses to align costs with actual usage.
This approach helps:
- Reduce upfront costs
- Improve cost predictability
- Support hybrid and cloud strategies
How organisations can reduce licensing complexity
From my experience, there are practical steps every organisation should take:
- Conduct a full assessment of current licences and infrastructure
- Identify unused or underutilised licences
- Modernise legacy systems where possible
- Align workloads with cloud or hybrid environments
- Improve visibility across security and compliance
Working with a knowledgeable partner can also help uncover inefficiencies and optimise deployment strategies.
Why licensing is now a strategic priority
Licensing is no longer just an IT concern. It directly affects business performance.
It impacts:
- Cost management
- Digital transformation
- Competitive positioning
Organisations that take a strategic approach to licensing are better prepared for future change.
Organisations that take a strategic approach to licensing will be better positioned to control costs and adapt to ongoing technology change.
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