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Microsoft 70-673 (TS: Designing, Assessing, and Optimizing Software Asset Management (SAM)) exam dumps vce, practice test questions, study guide & video training course to study and pass quickly and easily. Microsoft 70-673 TS: Designing, Assessing, and Optimizing Software Asset Management (SAM) exam dumps & practice test questions and answers. You need avanset vce exam simulator in order to study the Microsoft 70-673 certification exam dumps & Microsoft 70-673 practice test questions in vce format.

Foundations of the 70-673 Exam: Principles of Software Asset Management

The Microsoft 70-673 exam, "Designing, Assessing, and Optimizing Software Asset Management (SAM)," was a key certification for professionals aiming to validate their expertise in managing software assets. While the exam has been retired, the principles and practices it covered remain more relevant than ever in the world of IT governance, risk management, and financial optimization. This exam was designed for IT professionals, licensing specialists, and consultants responsible for implementing and maintaining a SAM program. The knowledge it tested is foundational for any organization looking to control costs and mitigate legal risks associated with software use.

This five-part series will serve as a comprehensive guide to the core concepts once covered in the 70-673 Exam. We will deconstruct the essential domains of Software Asset Management, from understanding complex licensing agreements to implementing the tools and processes needed to maintain compliance. The goal is to provide a deep, practical understanding of how to build and run an effective SAM program. The skills derived from this body of knowledge are critical for managing the significant financial investment that software represents in any modern enterprise.

Even without the formal certification, mastering the content of the 70-673 Exam provides a distinct professional advantage. It equips you with the ability to speak the language of software licensing, engage in strategic vendor negotiations, and align IT asset management with broader business objectives. Throughout this series, we will explore the methodologies, standards, and best practices that form the bedrock of a mature SAM practice, using the structure of the 70-673 Exam as our guide to achieving excellence in this critical IT discipline.

Core Principles of Software Asset Management

Software Asset Management, or SAM, is a business practice that involves managing and optimizing the purchase, deployment, maintenance, utilization, and disposal of software applications within an organization. At its core, SAM is about knowing what you have, where it is, and if you have the legal rights to use it. The primary goals of a SAM program are to reduce IT costs, manage business and legal risks, and improve operational efficiency. By implementing SAM, organizations can avoid overspending on unnecessary licenses and ensure they are compliant with vendor license agreements.

The SAM lifecycle provides a structured approach to managing software assets. It typically begins with planning, where the goals and scope of the SAM program are defined. The next phase is inventory, which involves discovering and collecting data on all software installed across the organization's network. Following the inventory is the verification and reconciliation stage, where the collected installation data is compared against purchase records and license entitlements. This process reveals the organization's compliance position. The final stage is maintenance, which involves continuously monitoring the environment to manage the lifecycle of all software assets.

A successful SAM program is not just a one-time project but an ongoing business function. It requires a combination of people, processes, and technology working together. The people component includes a dedicated SAM team with clear roles and responsibilities. The process component involves creating and enforcing policies for software procurement, deployment, and retirement. The technology component includes tools for software discovery, inventory management, and license tracking. Mastering these core principles was a fundamental requirement for the 70-673 Exam and remains essential for effective IT management.

Understanding Software Licensing Models

A crucial aspect of the knowledge required for the 70-673 Exam is a thorough understanding of the various ways software is licensed. Software vendors use a wide range of licensing models, and misinterpreting them can lead to significant compliance issues. One of the most common models is the per-device license, where a license is required for each physical or virtual device on which the software is installed or accessed. Another popular model is the per-user license, which grants a specific named user the right to use the software on any number of devices.

For server software, the models become more complex. Processor-based or core-based licensing requires licenses based on the number of physical processors or cores within the server running the software. This model is common for database and infrastructure software like Microsoft SQL Server and Windows Server. Additionally, many server products require Client Access Licenses, or CALs. A CAL is a license that grants a user or device the right to access the services of the server software. CALs are required in addition to the server license itself and come in both per-user and per-device variants.

The industry has also seen a significant shift towards subscription-based licensing, exemplified by services like Microsoft 365. With a subscription model, organizations pay a recurring fee for the right to use the software for a specific term. This model often includes rights to updates and support and can provide more flexibility than traditional perpetual licenses. Understanding the nuances of each of these models, from perpetual and subscription to CALs and core-based licenses, is absolutely essential for performing an accurate license reconciliation, a core task in any SAM program.

The Role of SAM in IT Governance and Compliance

Software Asset Management is a critical component of a broader IT governance framework. IT governance is the system by which an organization directs and controls its IT strategies and operations. SAM directly supports the goals of IT governance by providing visibility and control over a significant and often high-risk category of IT assets. By establishing clear policies and procedures for software management, SAM helps ensure that IT resources are used responsibly and in alignment with business objectives. This was a key theme within the scope of the 70-673 Exam.

The most immediate benefit of SAM in the context of governance is risk mitigation. The use of unlicensed software exposes an organization to serious legal and financial risks. Software vendors have the right to audit their customers to ensure compliance with license agreements. If an audit reveals a shortfall in licenses, the organization can face substantial fines, unbudgeted purchase requirements, and damage to its reputation. A mature SAM program provides a proactive defense against these audits by maintaining a continuous state of compliance and being able to produce the necessary documentation to prove it.

Beyond legal compliance, SAM contributes to financial governance by controlling software spending. Without a central view of software assets, organizations often purchase more licenses than they need, resulting in wasted expenditure. A SAM program identifies these instances of "shelfware"—software that is owned but not deployed—and also finds opportunities to re-harvest underutilized licenses. By optimizing the existing software portfolio, SAM ensures that the organization extracts the maximum value from its software investments, directly supporting the financial goals of the business and demonstrating responsible stewardship of company resources.

Key SAM Standards and Frameworks

To guide organizations in implementing effective Software Asset Management, several industry standards and frameworks have been developed. The most prominent of these is the ISO/IEC 19770 family of standards. This set of international standards provides a globally recognized framework for SAM. It outlines the processes and requirements for establishing a trustworthy SAM program, helping organizations to manage their software assets in a structured and consistent manner. Adherence to this standard demonstrates a commitment to best practices and can simplify interactions with vendors and auditors. This was an important reference for the 70-673 Exam.

The ISO/IEC 19770-1 standard specifically defines the requirements for a SAM management system. It is structured in tiers, allowing organizations to implement SAM in a phased approach, starting with basic inventory and gradually maturing to more advanced levels of optimization. This tiered approach makes it accessible for organizations of all sizes and maturity levels. The standard covers all aspects of the SAM lifecycle, including policy creation, asset tracking, verification and compliance, and relationship management with software vendors. It provides a roadmap for continuous improvement.

Another important framework, particularly in the Microsoft ecosystem, is the SAM Optimization Model (SOM). This model, which we will explore in greater detail later in this series, helps organizations assess the maturity of their current SAM practices and identify a clear path for improvement. It categorizes SAM maturity into four levels: Basic, Standardized, Rationalized, and Dynamic. Understanding these established frameworks and standards is crucial for any SAM professional, as they provide the theoretical underpinnings and practical guidance needed to build a successful and sustainable SAM program.

Initial Steps in a SAM Program

Launching a Software Asset Management program requires careful planning and a structured approach. The very first step is to secure executive sponsorship. A SAM initiative often requires changes to processes across multiple departments, including IT, finance, and procurement. Without strong support from senior management, the program is unlikely to succeed. The business case for SAM should be presented clearly, focusing on the key benefits of cost savings, risk reduction, and improved operational efficiency. This buy-in is the foundation for the entire program.

Once sponsorship is secured, the next step is to assemble a dedicated SAM team. This team should be cross-functional, including members from IT, procurement, legal, and finance. Clear roles and responsibilities must be defined. A SAM manager should be appointed to lead the initiative and act as the central point of contact. This team will be responsible for developing the SAM policies and procedures, selecting the appropriate tools, and overseeing the day-to-day management of the program. These initial organizational steps were a practical consideration for the 70-673 Exam.

The final initial step is to define the scope of the SAM program. It is often best to start with a pilot project focused on a specific high-risk or high-cost software vendor, or a particular department within the organization. This allows the team to refine its processes and demonstrate some quick wins before rolling out the program across the entire enterprise. Defining a clear and manageable initial scope helps to build momentum and prove the value of the SAM initiative to the rest of the organization, paving the way for a more comprehensive, long-term program.

Deep Dive into the SAM Optimization Model

The Microsoft SAM Optimization Model, or SOM, is a key framework that was central to the curriculum of the 70-673 Exam. It provides organizations with a way to measure the maturity of their Software Asset Management practices and offers a clear roadmap for improvement. The model is structured into four distinct levels, each representing an increasing degree of control, efficiency, and strategic value. Understanding these levels is essential for any professional tasked with assessing or advancing a SAM program. The goal is to move progressively from a reactive to a proactive and dynamic state of asset management.

The first level is Basic SAM. At this stage, an organization has a reactive and often chaotic approach to software management. There is no centralized tracking of software assets, and software purchases are typically unmanaged and decentralized. An organization at this level is likely to be significantly non-compliant and at high risk during a software audit. The first step towards maturity involves performing an initial inventory to get a basic understanding of what software is deployed in the environment. This level is characterized by a lack of formal policies and procedures.

The second level is Standardized SAM. Here, the organization has begun to implement standardized policies and processes for managing software assets. A centralized software inventory is established and maintained, and there is a defined process for procuring software. The organization has a better handle on its license entitlements and is starting to track them against its inventory. While still largely reactive, an organization at the Standardized level has a much-improved view of its software estate and has taken concrete steps to reduce its compliance risk.

The third level is Rationalized SAM. At this level, the SAM program becomes more proactive. The organization moves beyond just tracking assets to actively optimizing its software portfolio. This includes implementing software metering to identify underutilized applications that can be re-harvested and redeployed elsewhere. A Definitive Software Library (DSL) is often established to ensure only approved software versions are deployed. The goal is to reduce costs by eliminating redundant applications and consolidating software to a smaller set of standard products, improving both management and security.

The final and most mature level is Dynamic SAM. An organization at this level has a fully integrated and automated SAM program that is aligned with its strategic business goals. Software asset management is embedded into the entire IT lifecycle, from procurement to retirement. The organization uses advanced analytics to forecast future software needs and can optimize its licensing for complex scenarios like virtualization and cloud computing. At the Dynamic level, SAM provides significant strategic value to the business by enabling IT agility and driving continuous cost optimization, reflecting the ultimate goal of the 70-673 Exam principles.

Software Inventory and Discovery Tools

A cornerstone of any SAM program is the ability to accurately discover and inventory all software installed across the organization's IT environment. This is impossible to do manually in any reasonably sized organization, so the use of technology is essential. The 70-673 Exam required an understanding of the types of tools available and their role in the SAM process. Discovery tools are designed to scan the network and identify all hardware and software assets. They form the foundation upon which the entire SAM practice is built, providing the raw data for analysis and reconciliation.

There are two primary approaches to software discovery: agent-based and agentless. Agent-based tools require a small piece of software, or agent, to be installed on each client device and server. This agent collects detailed information about the hardware and software on that machine and reports it back to a central management server. This method is generally very thorough but requires the overhead of deploying and maintaining the agents. Agentless tools, on the other hand, use network protocols to remotely scan devices without needing to install any software on them, which can be simpler to deploy.

Microsoft offers its own powerful discovery and inventory tools, most notably Microsoft Endpoint Configuration Manager (formerly SCCM). This platform can provide detailed hardware and software inventory, as well as software metering capabilities. Many other third-party tools are also available, each with its own strengths. When selecting a tool, organizations should consider factors such as the size and complexity of their environment, the types of platforms they need to support, and the tool's ability to integrate with other systems like procurement and service desk applications.

Regardless of the tool chosen, its purpose is to create a comprehensive baseline of all software assets. This inventory data is the "what's installed" part of the compliance equation. However, the raw data from these tools is often noisy and inconsistent. It requires a significant amount of processing to become useful. The next critical step in the SAM process is to take this raw inventory and normalize it, which involves cleaning it up and standardizing it to create a clear and accurate picture of the software landscape.

Analyzing and Normalizing Inventory Data

Once a software discovery tool has collected the raw inventory data, the next critical step is normalization. This process is often overlooked but is absolutely essential for creating an accurate and usable software asset database. Raw inventory data is typically messy; a single software product might appear with many different names due to variations in version numbers, patch levels, and suite components. For example, "Microsoft Office Professional Plus 2019" might be reported in dozens of different ways. The goal of normalization is to consolidate all these variations into a single, standardized record.

Normalization involves matching the discovered software titles against a comprehensive software recognition catalog or library. This catalog contains standardized information about millions of software applications, including the correct publisher, product name, version, and edition. By processing the raw inventory against this catalog, a SAM tool can transform the chaotic raw data into a clean, organized list of all unique software products installed in the environment. This provides a clear and accurate foundation for the license reconciliation process. A key topic for the 70-673 Exam was understanding the importance of this data refinement.

Beyond normalization, the data must also be categorized. Software can be classified in various ways, such as commercial software that requires a license, freeware that can be used without cost, or unsupported software that may pose a security risk. This categorization helps to focus the compliance effort on the software that represents the most significant financial and legal risk. The outcome of the analysis and normalization process is a trustworthy inventory baseline that can be confidently compared against the organization's license entitlement records.

Without proper normalization, any attempt at license reconciliation will be fundamentally flawed. You cannot accurately count how many installations of a product you have if it appears under twenty different names in your inventory system. This step is a prerequisite for creating a reliable Effective License Position (ELP), which is the final report that shows whether the organization is over-licensed or under-licensed for each software product. It is a meticulous process but one that is critical to the success of the entire SAM program.

Reconciling Licenses with Inventory

License reconciliation is the core activity of any SAM program. It is the process of comparing the normalized software inventory data (what you have installed) with your license entitlement records (what you have the rights to use). The result of this comparison is known as the Effective License Position, or ELP. The ELP for a specific software product shows whether the organization has a surplus of licenses (is over-licensed), a deficit of licenses (is under-licensed and non-compliant), or is perfectly balanced. This process was a major focus of the 70-673 Exam.

To perform a reconciliation, you first need to gather all your proof of license entitlements. This includes purchase orders, invoices, license agreements, and certificates of authenticity. This information needs to be collected and recorded in a central license repository. For each purchase, you need to know the specific product, version, quantity, and the terms of the license agreement under which it was purchased. This entitlement data represents one side of the equation. The other side is the normalized inventory data we discussed previously.

The reconciliation process involves carefully matching the installed software with the corresponding license entitlements. This is often complex because of licensing rules such as upgrade and downgrade rights. For example, an installation of Office 2016 might be covered by a license for Office 2019 due to downgrade rights. A SAM professional must understand these product use rights to perform an accurate reconciliation. The process is repeated for every licensed software product in the organization.

The final ELP report is the primary deliverable of the reconciliation process. It provides a clear, data-driven view of the organization's compliance status. This report is invaluable for several reasons. It identifies any compliance gaps that need to be addressed before a vendor audit. It highlights opportunities for cost savings by identifying surplus licenses that can be re-harvested. And it provides the data needed for negotiating new software agreements with vendors. Regularly performing this reconciliation is the cornerstone of maintaining a healthy and optimized SAM program.

Managing Software Metering

As a SAM program matures into the Rationalized and Dynamic levels of the SOM, it moves beyond simple inventory and compliance to focus on optimization. A key technology that enables this optimization is software metering. Software metering is the process of monitoring the actual usage of software applications. It answers not just "what is installed?" but "what is actually being used, and how often?" This information is critical for making informed decisions about software investments. The concepts behind software metering were an important part of the 70-673 Exam.

Software metering tools, which are often part of larger inventory suites like Microsoft Endpoint Configuration Manager, track application usage on client devices. They can record information such as how many times an application has been launched, how long it has been actively used, and which users are using it. This data is collected and aggregated in a central database, providing a detailed picture of software utilization across the entire organization. This allows SAM managers to identify applications that are installed but rarely or never used.

The primary benefit of software metering is to enable software re-harvesting. For example, the metering data might reveal that a company owns 500 licenses for an expensive application like Microsoft Project, but only 300 employees have used it in the last six months. This means there are 200 installed copies that are not being used. The organization can then uninstall the software from those 200 devices and return the licenses to a central pool, ready to be redeployed to new users who have a genuine need for them. This avoids the cost of purchasing new licenses.

Software metering data is also extremely valuable during vendor contract negotiations. If you can demonstrate that your usage of a particular product is declining, or that you only need a fraction of the licenses you currently own, you are in a much stronger position to negotiate better terms or a smaller renewal contract. By providing concrete data on software usage, metering allows organizations to move from spending based on installations to spending based on actual need, which is a core principle of a highly mature and cost-effective SAM program.

Integrating SAM with the IT Lifecycle

For a Software Asset Management program to be truly effective and sustainable, it cannot operate in a silo. It must be deeply integrated into the broader IT lifecycle and its associated processes, such as those defined in frameworks like ITIL (Information Technology Infrastructure Library). The principles of the 70-673 Exam emphasized that SAM should be a consideration at every stage of an asset's life, from the initial request to its final retirement. This integration ensures that compliance and optimization are maintained continuously, rather than being addressed in periodic, disruptive projects.

The lifecycle begins with the request and procurement process. When a new software title is requested, the SAM process should be triggered to check if an existing license can be re-harvested before a new one is purchased. During the deployment phase, the SAM system must be updated to reflect that a license has been assigned to a specific user or device, and the inventory tool should confirm the successful installation. This creates a closed-loop system that tracks the asset from the moment it is acquired.

During the operational life of the asset, SAM processes monitor its usage and any changes, such as upgrades or patches. This is crucial for maintaining an accurate inventory. Finally, when an employee leaves the company or a device is decommissioned, the retirement process must include steps to uninstall the software and return the license to the available pool. By weaving SAM into these standard IT operational processes, an organization moves from a reactive audit-defense posture to a proactive state of continuous compliance and optimization.

This integration transforms SAM from a periodic administrative chore into a strategic, value-added function. It helps to enforce software policies automatically and ensures that asset data is always current and reliable. By making SAM an integral part of day-to-day IT operations, organizations can significantly reduce their risk, control their costs, and ensure that their software investments are fully aligned with their business needs. This holistic approach is a hallmark of a mature SAM practice.

Procurement and Vendor Management

A critical control point in the software lifecycle is the procurement process. Without a centralized and well-managed procurement function, an organization has little hope of controlling its software assets. A key objective for any professional applying the knowledge of the 70-673 Exam is to establish a robust process for acquiring software. This begins with creating a formal procurement policy that dictates that all software purchases must go through a central channel, typically the IT or procurement department. This prevents decentralized, unmanaged purchasing that leads to compliance issues and wasted spend.

When a software request is approved, the procurement process should ensure that the purchase is made under the most advantageous licensing agreement available to the organization. This requires effective vendor management, which includes negotiating favorable terms and conditions with software publishers and resellers. The SAM team should work closely with the procurement team to provide data that can inform these negotiations, such as current deployment numbers and future demand forecasts. This data-driven approach strengthens the organization's negotiating position.

After a purchase is made, the most critical step is to securely collect and store the proof of license entitlement. This documentation is the organization's legal proof that it owns the software. It includes the purchase order, the invoice from the reseller, and the license agreement itself (e.g., a Microsoft Volume Licensing Agreement). These records must be meticulously maintained in a central repository, often within a dedicated SAM tool. Without this proof of entitlement, an organization has no defense during a software audit.

Effective procurement and vendor management processes are fundamental to a successful SAM program. They ensure that the organization buys only the software it needs, under the best possible terms, and that it maintains the necessary records to prove ownership. This control at the entry point of the software lifecycle prevents many of the problems that SAM programs are designed to solve, making it a proactive rather than a reactive discipline.

Managing Software Requests and Deployment

A well-defined process for handling employee software requests is essential for maintaining control over the software environment. This process serves as a gatekeeper, ensuring that only approved and licensed software is deployed onto company assets. The principles of the 70-673 Exam stressed the importance of formalizing this workflow. The process typically starts with an employee submitting a request through a service catalog or help desk portal. The request should include a business justification for why the software is needed.

Once a request is submitted, it should go through an approval workflow. This may involve the employee's manager, who approves the business need and budget, and the IT or SAM team, who checks for license availability. The SAM team will first determine if an unused license can be re-harvested from the existing pool. This single step can lead to significant cost savings by avoiding unnecessary new purchases. If no license is available, the request is then passed to procurement to acquire a new one.

After the license is secured, the software can be deployed. In a mature SAM environment, deployment is handled through a standardized, automated process using tools like Microsoft Endpoint Configuration Manager. This ensures that the software is installed correctly and consistently. More importantly, it allows the deployment to be linked directly to the SAM database. When the software is deployed, the SAM system should be automatically updated to assign the license to the specific user or device, and the inventory should be updated to reflect the new installation.

This closed-loop request, approval, and deployment process is a core component of a proactive SAM program. It provides an end-to-end audit trail for every piece of software in the organization, from the initial request to its installation. It enforces compliance with company policies, prevents the introduction of unauthorized software, and maximizes the value of existing software assets through re-harvesting. It is a fundamental process for maintaining a controlled and optimized software estate.

The Role of a Definitive Software Library

A Definitive Software Library, or DSL, is a concept from ITIL that plays a crucial role in a mature SAM program. A DSL is a secure, central, and logical library in which all authorized and definitive versions of software are stored and protected. It is the single source of truth for all software that is approved for deployment within the organization. When software needs to be installed, the installation media is pulled from the DSL, not from a random network share or a physical disk. This practice was a key component of the standardized processes covered in the 70-673 Exam.

The primary purpose of a DSL is to ensure control and consistency. By using a DSL, the IT department can guarantee that only properly licensed, tested, and virus-scanned versions of software are being deployed. This prevents the installation of unauthorized or potentially malicious software downloaded from the internet. It also ensures that all deployments of a particular application are from the same version and build, which simplifies support and patch management, thereby improving the overall security and stability of the IT environment.

The DSL is more than just a file repository; it is linked to the SAM database. Each software package in the DSL is associated with its corresponding license information. This ensures that the organization has the legal right to deploy every application stored within it. The DSL can also store the license keys and other configuration information needed for installation. This tight integration between the physical media (or installation packages) and the license records is what makes the DSL such a powerful control mechanism.

Implementing a DSL is a key step in moving up the SAM Optimization Model, particularly to the Rationalized level. It is a foundational element for standardizing the software portfolio and automating software deployment. It provides a robust control point that enhances security, ensures compliance, and improves operational efficiency. By establishing a DSL, an organization takes a significant step towards creating a secure, predictable, and well-managed software environment.

Software Retirement and Re-harvesting

The final stage of the software lifecycle is retirement. Just as there needs to be a formal process for acquiring and deploying software, there must also be a formal process for removing it when it is no longer needed. This process, often referred to as decommissioning or retirement, is critical for both security and cost optimization. A key skill emphasized in the 70-673 Exam was the ability to manage this end-of-life stage effectively. When an employee leaves the company or a computer is replaced, all licensed software installed on that asset must be properly removed.

The primary goal of the retirement process from a SAM perspective is to enable license re-harvesting. Once a piece of software is uninstalled from a device, the license that was assigned to it becomes available for reuse. This license should be returned to a central pool of available licenses within the SAM tool. The next time a request for that software comes in, this re-harvested license can be assigned, eliminating the need to purchase a new one. This process of reclaiming and re-using licenses is one of the most direct ways a SAM program can deliver significant cost savings.

A formal retirement process also has important security benefits. Leaving unused software on devices can create vulnerabilities, especially if that software is no longer being patched. By ensuring that all unnecessary software is removed, the organization reduces its attack surface and improves its overall security posture. The retirement process should be integrated with the organization's HR and IT asset disposal procedures to ensure that it is triggered automatically when a user or device is removed from the active environment.

Effective software retirement completes the cradle-to-grave management of a software asset. It requires a combination of clear processes and reliable technology. Inventory tools must be able to verify that the software has been successfully uninstalled, and the SAM database must be updated to reflect the change in the license's status. By diligently managing the retirement phase, organizations can maximize the return on their software investments and maintain a lean, secure, and compliant IT environment.

Overview of Microsoft Volume Licensing Programs

A deep understanding of Microsoft's Volume Licensing programs was arguably the most critical technical skill required for the 70-673 Exam. These programs are the primary way that organizations purchase Microsoft software, and each has its own set of rules, benefits, and target audiences. An inability to navigate these programs makes effective SAM for Microsoft products impossible. The programs are generally designed to make it easier and more affordable for organizations to acquire multiple licenses, as opposed to buying individual retail copies.

The Enterprise Agreement (EA) is designed for large organizations, typically with 500 or more users or devices. It is a three-year agreement where the organization commits to purchasing licenses for one or more core products (like Windows, Office, and CAL Suites) for all of its qualified desktops. This "enterprise-wide" commitment provides the best pricing and benefits, including Software Assurance. The EA is ideal for organizations that want to standardize on Microsoft technology and have predictable software costs over a three-year period.

For mid-sized organizations, the Open Value program offers flexibility. It also has a three-year term and includes Software Assurance as a standard feature. An organization can choose a company-wide option, similar to an EA but for smaller organizations, or a non-company-wide option where they can purchase as few as five licenses to start the agreement. The MPSA (Microsoft Products and Services Agreement) is a newer, more flexible transactional agreement for organizations that want to consolidate purchasing of both on-premises software and online services.

For smaller organizations, the Open License program was a popular transactional option for making one-time purchases. It required an initial purchase of just five licenses to open the agreement. It's important to note that Microsoft is evolving its licensing programs, and some, like Open License, have been phased out in favor of newer models through the Cloud Solution Provider (CSP) program. However, understanding the structure of these legacy agreements is still important for managing existing entitlements. A SAM professional must be an expert in these programs to effectively manage their organization's Microsoft portfolio.

Understanding Product Use Rights and Product Terms

Beyond the purchasing program, the most important document in Microsoft licensing is the Product Terms document, formerly known as the Product Use Rights or PUR. This legal document defines exactly how an organization can use the software it has licensed through a Volume Licensing agreement. It is updated regularly by Microsoft and contains the specific terms, conditions, and rights associated with each product. A core competency tested in the 70-673 Exam was the ability to read and interpret this complex but essential document. It is the rulebook for Microsoft software compliance.

The Product Terms document details many critical rights. One of the most important is downgrade rights. This grants the organization the right to deploy a prior version of the software instead of the version they are licensed for. For example, if you are licensed for Windows Server 2022, downgrade rights allow you to deploy Windows Server 2019 or 2016 instead. This is crucial for maintaining compatibility with other applications or hardware. Without understanding this right, an organization might mistakenly think it is non-compliant.

Other important rights include second use rights, which may allow the primary user of a licensed device to install a second copy on a portable device for their exclusive use. Virtualization rights define how software can be used and licensed within virtual machines, a common but complex scenario. The Product Terms also specify the rules for license reassignment, dictating how often a license can be moved from one user or device to another. It is the definitive source for answering almost any question about how a Microsoft product can be deployed and used.

A SAM professional must know where to find the current Product Terms document and how to navigate it to find the rules for specific products. The terms that apply to a license are generally the ones that were in effect at the time the license was purchased. Misinterpreting these rights is one of the most common causes of non-compliance found during a Microsoft audit. Therefore, a deep and practical understanding of this document is a non-negotiable skill for anyone responsible for Microsoft SAM.

Licensing Microsoft Windows Desktop and Server Operating Systems

Licensing Microsoft's operating systems, both for desktops and servers, has its own unique set of rules that were a key focus of the 70-673 Exam. For the Windows desktop operating system (e.g., Windows 11), it is important to understand that a full operating system license cannot be purchased through Volume Licensing. Volume Licensing only provides upgrade licenses. This means that every PC must have a pre-existing, qualifying base license before a Volume License upgrade can be applied. This base license is typically the OEM license that comes with a new PC from a manufacturer like Dell or HP.

For Windows Server, the licensing model has shifted over the years. The current model for Windows Server Standard and Datacenter editions is based on physical cores. To license a physical server, all the physical cores in the server must be licensed, with a minimum of 8 core licenses required for each physical processor and a minimum of 16 core licenses required for each server. The main difference between the Standard and Datacenter editions lies in virtualization rights. A fully licensed Datacenter server allows for an unlimited number of Windows Server virtual machines, while Standard edition provides rights for only two.

In addition to the server license itself, access to Windows Server requires Client Access Licenses (CALs). Every user or device that accesses the services of the server (such as file sharing or printing) needs a CAL. Windows Server CALs can be purchased on a per-user basis, which covers one user on any number of devices, or on a per-device basis, which covers one device with any number of users. Choosing the right type of CAL depends on the organization's user and device profile. Understanding these distinct rules for client and server operating systems is fundamental to ensuring compliance.

Licensing Microsoft Office and Productivity Applications

Microsoft Office is one of the most ubiquitous software products in the business world, and understanding its licensing was a critical part of the 70-673 Exam. Historically, Office was licensed on a per-device basis. A license was assigned to a specific computer, and any user of that computer could use the software. This model is still available for perpetual versions of Office purchased through Volume Licensing, such as Office LTSC 2021. With this model, if you have 100 devices that need Office, you need to purchase 100 licenses.

The modern approach, however, has shifted significantly to a user-centric, subscription-based model with Microsoft 365 Apps (formerly known as Office 365 ProPlus). With this model, the license is assigned to a named user, not a device. A single user license allows that user to install and use the full Office suite on up to five PCs or Macs, five tablets, and five smartphones. This provides much greater flexibility for users who work across multiple devices. The license is active as long as the subscription is maintained.

This shift from device-based to user-based licensing has profound implications for SAM. It requires a different way of tracking and managing licenses, focusing on user identities rather than machine names. For organizations with a mix of perpetual and subscription licenses, the reconciliation process can be complex. It is essential to understand which users are covered by which type of license. The SAM process must be able to accurately count both licensed devices and licensed users and reconcile them against the appropriate entitlements.

Products like Microsoft Project and Visio are typically licensed separately from the main Office suite. They also have both perpetual, per-device licenses and subscription, per-user licenses available. A SAM professional must be aware that these applications are not included in the standard Office Professional Plus or Microsoft 365 Apps suites and require their own licenses. Accurately managing the complex portfolio of Microsoft productivity applications is a key task in any Microsoft-centric SAM program.

Understanding Client Access Licenses and Management Licenses

Client Access Licenses (CALs) and Management Licenses (MLs) are often a source of confusion, but they are a critical component of Microsoft licensing that was thoroughly covered in the 70-673 Exam. A CAL is not a software product; rather, it is a legal right for a user or a device to access the services or functionality of a server product. Many Microsoft server products, including Windows Server, Exchange Server, and SharePoint Server, use this model. It is important to remember that CALs are required in addition to the license for the server software itself.

CALs come in two main types: User CALs and Device CALs. A User CAL licenses a specific user to access the server's services from any device they use. This is the most economical choice for organizations where employees need roaming access to the corporate network using multiple devices, such as a desktop, laptop, and smartphone. A Device CAL licenses a specific device to be used by any user to access the server's services. This is the preferred option in scenarios where multiple users share a single device, such as in a shift work environment.

To simplify licensing, Microsoft offers CAL Suites. The Core CAL Suite bundles CALs for Windows Server, Exchange Server, SharePoint Server, and other products into a single, cost-effective license. The Enterprise CAL Suite includes everything in the Core CAL Suite plus additional CALs for more advanced functionalities. These suites are available on both a per-user and per-device basis.

Management Licenses (MLs) are similar in concept to CALs but are required for managing server environments using products from the Microsoft Endpoint Manager or System Center family. An ML is required for each managed operating system environment (OSE). For example, to manage a server with System Center, you need a Server ML. To manage a desktop, you need a Client ML. Understanding when and what type of CALs and MLs are required is essential for ensuring full compliance in a Microsoft server environment.

The Software Audit Process

One of the primary drivers for implementing a SAM program is to be prepared for a software audit. An audit, or what vendors often call a "Software License Review," is a formal process where a software publisher verifies that a customer is in compliance with their license agreements. Understanding how to manage this process was a key practical skill for the 70-673 Exam. The process typically begins with a formal notification letter from the vendor, stating their intent to conduct a review and outlining the scope and timeline. It is critical to treat this notification seriously and respond professionally.

Upon receiving the letter, the first step is to validate the request and assemble the internal audit response team. This team should include the SAM manager, IT staff, legal counsel, and procurement specialists. The team's role is to act as the single point of contact with the auditors and to manage all internal data collection activities. It is important to control the flow of information and not provide the auditors with more data than is explicitly required by the terms of your license agreement.

The core of the audit involves collecting deployment data and proof of license entitlements. The organization will need to run inventory reports to determine what software is installed and where. This data is then reconciled against the purchase records and license agreements to create a compliance position. This internally generated report should be carefully reviewed and validated before being shared with the auditors. Any identified shortfalls should be understood and a remediation plan considered before the final data is submitted.

The final phase involves presenting the data to the auditors, negotiating any findings, and settling the outcome. If a shortfall is confirmed, the organization will typically be required to purchase the necessary licenses to become compliant, sometimes with a penalty. A well-managed audit process, supported by a mature SAM program, can make this experience much smoother and less costly. Being "audit-ready" at all times is the ultimate goal of a proactive SAM practice.

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