I just returned from COMDEX, where I hosted a session about terminal services (I’ll also be speaking at the Chicago COMDEX in April). Based on some of the questions attendees asked after my talk and on some reader email that arrived while I was gone, it's time to discuss terminal server licensing again.
First, the licensing models for Windows NT Server 4.0, Terminal Server Edition (TSE) and Windows 2000 Server Terminal Services are different and incompatible. Whereas NT Workstation clients come with a license for connecting to TSE, this license doesn't apply to connecting to Win2K Terminal Services. NT Workstation clients connecting to a Win2K terminal server must use a terminal services client access license (TSCAL), just as Windows 98 clients do. The only OS that can use a license from the Win2K built-in licensing pool is Win2K Professional.
Second, application licensing varies with the application. Generally speaking, running an application on a terminal server doesn't mean that everyone who accesses that application on the server can use the same license. That said, there's no hard-and-fast rule for how application licensing works for a terminal server. If you license the application on a per-seat basis, you need a license for each client; if you license the application on a per-user basis, you need a license for each person that uses the application; if you license the application on a per-connection basis, you need a license for the greatest number of people that will be connected at any time. Clear as mud, right? The moral of the story is this: Read the End User License Agreement (EULA) carefully before installing an application on a terminal server.
Third, there's a lot of misinformation out there. A reader wrote to tell me that the teacher of his Certified Citrix Administrator (CCA) class had told him a few things about licensing, including that by law the license server must be another Win2K box and that there's no way for a Windows terminal to store its TSCAL in flash ROM. If one person thinks such things, I figure that others might as well. The fact of the matter is that there's no legal reason why you can’t make a terminal server a terminal license server. There might be logistical reasons why doing so is a bad idea (e.g., the license server must be on a domain controller— DC— in a pure Win2K domain, but because you don’t want your terminal server to be a DC, you wouldn’t put the license server on the terminal server). However, such limitations are technical, not legal. And as for Windows terminals being incapable of storing TSCALS in flash memory, that's exactly how terminals store them. Only when something's wrong with the terminal’s design is it unable store its license when you power it down— and such problems are what cause terminals to eat more than their fair share of licenses.
Finally, some good news. Currently, you have to call the Microsoft clearinghouse before you can move licenses from one client computer to another. According to Allan Nieman, Microsoft’s technical product manager for terminal server licensing, the company is engineering an enhancement for Win2K Terminal Services licensing to allow automated reissuing of "lost" TSCALs to client devices. The enhancement will mean that the reissuing can occur between the client, the terminal server, and the license server— without intervention from the system administrator or Microsoft. Microsoft hopes to release this fix during first quarter 2001; I’ll keep you posted.