How is Microsoft Office licensed?

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I have seen a conversation taking place in one of the online forums about how Microsoft Office is licensed and how secondary use rights fits in. To that end, I thought I would post this information here to address the question and for others to use in their understanding of this. Here are the basics:

  • Microsoft Office is licensed on a per device bases. What this means is you need a Microsoft Office license for every device that is going to run Office.

  • Microsoft Office is not licensed on a concurrent basis, which means it is not based on the number of devices running Office at one given time, it is based on the total number of devices that run Office. For instance, if you have 10 PCs in your company and want to run Office on all of them; however, only 5 PCs will use Office at any one given time, you will need 10 Microsoft Office licenses since you have 10 total devices that will run Office, not just 5.

  • If you plan to run Microsoft Office from a network device such as a file server or through something like Citrix or Terminal Services, make sure your Office license has Network Storage and Use Rights. As discussed in many prior posts, there are differences in licensing rights between OEM, Retail Box, and Volume Licenses for Microsoft products. Network Storage and Use is one of those rights, as is Downgrade Rights, and Transfer Rights. Volume licensing does provide these rights; whereas, OEM Office licenses do not. You can read more on this at: Answer to a question on how Microsoft Office is licensed in a Terminal Services environment and why OEM Office doesn’t cover it, in plain English as well as looking at:

  • Remember, you can add Software Assurance to your OEM Microsoft Office licenses within 90 days of purchase to get Volume Licensing rights for them. Take a look at these items for more on that:

  • Also note that using technologies like Citrix or Terminal Services to access Microsoft Office in no way lessens the number of devices running Office. If you have 35 PCs accessing the Terminal Server to run Microsoft Office, you need 35 Microsoft Office licenses with Networks storage and use rights for those PCs. Don’t know what kind of licenses you have? You might want to read this: How can you tell if your client has OEM, Retail Box or Volume License software?

  • Secondary Use Rights are a benefit included in some licenses that allows for the primary user of the license to also use that software on a portable device (like a laptop) under the same license. For instance, if you look at the EULA for Microsoft Office Small Business 2007 online, you will see that the Retail Box license of Office contains the following:

    • Licensed Device. You may install and use one copy of the software on the licensed device.
    • Portable Device. You may install another copy on a portable device for use by the single primary user of the licensed device.”
    • This same clause exists for Microsoft Office purchased via Volume Licensing; however, it is not included in the OEM Microsoft Office license. Note that for secondary use rights, there are some important things to keep in mind:
    • Secondary use rights only applies to the single primary user of the original Office license. So only that one person can use this secondary use license on a portable device. For instance, if John Smith is the primary user of the Microsoft Office Volume License on a PC, he could use that version of Office on a single laptop through secondary use rights and be covered. Jane Jones; however, could not use Office on John Smith’s laptop through the secondary use rights since she is not the primary user of the Microsoft Office Volume License, so she does not have secondary use rights. If they share the laptop and both need Office, you would need to purchase a Microsoft Office license for that laptop so they both could use it. (Unless Jane is the primary user of Office on a different PC from John and has secondary use rights from her license too).
    • Secondary use rights only applies to portable devices, not home PCs. Secondary use rights is not the same as Home Use Rights, which is designed to provide Office licenses for use on home PCs.

  • Home Use Rights is a Software Assurance benefit that you receive when you purchase Software Assurance for your Microsoft Office license. This benefit provides one license of Microsoft Office to use at home for every license of Microsoft Office covered with Software Assurance. For instance, if your company has Software Assurance for 24 Microsoft Office licenses, then the company would receive 24 Microsoft Office Home Use rights to distribute to 24 of its employees. You can see more on Home Use rights HERE.

If you just need to view a file created with Microsoft Office, you may not have to have a Microsoft Office license to do so. We provide Microsoft Office viewers that you can download and use to merely view files created with Microsoft Office. If you want to edit or create files in Microsoft Office, then you will need a license for Office to do so. You can read more on the viewers here: I can't believe Microsoft is making me buy an Office license for a PC I'm using one time just so I can open a Word or Excel document I just need to read once!

I hope this helps address some of the questions around how Microsoft Office is licensed.

Thank you and have a wonderful day,

Eric Ligman
Microsoft US Senior Manager
Small Business Community Engagement
This posting is provided "AS IS" with no warranties, and confers no rights