Impact of different license types on software reconciliation

  • Release version: Xanadu
  • Updated April 22, 2025
  • 3 minutes to read
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    Summary of Impact of different license types on software reconciliation

    This guide explains how various software license types affect the Software Asset Management (SAM) reconciliation process. Each license type includes specific entitlements and conditions that influence how licenses are tracked, maintained, and upgraded within SAM, ensuring accurate compliance and optimization of software usage.

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    Key License Types and Their Impact

    • Perpetual: A one-time purchase license granting indefinite software use without ongoing fees. It lacks built-in maintenance rights, so benefits like upgrades and support require associating maintenance or Software Assurance (SA) entitlements for full benefits.
    • Perpetual + Software Assurance (Microsoft only): Combines perpetual licensing with SA to provide upgrade rights, license mobility, unlimited virtualization (e.g., Windows Server Datacenter), and virtual layer licensing. SAM automatically applies these SA benefits for Microsoft products.
    • Subscription: Applies to subscription-based software (e.g., Jira, Microsoft 365, Adobe Creative Cloud) and some non-subscription products using subscription licenses. Compliance is based on user subscriptions from the subscription portal. These licenses may also receive SA benefits.
    • Perpetual + Maintenance (Non-Microsoft): Similar to Perpetual + SA but for non-Microsoft publishers like Oracle and VMware, providing updates, patches, and sometimes support. SAM automatically applies maintenance benefits.
    • Upgrade and Step-up: Enable upgrading from lower-tier to higher-tier editions (e.g., SQL Server Standard to Enterprise) without purchasing full new licenses. These upgrades must be linked in the Software Entitlement form’s Upgraded Entitlements tab to reflect proper reconciliation.
    • Software Assurance and Maintenance Entitlements: These entitlements provide benefits but must be linked to base perpetual licenses for SAM to reconcile them correctly. Unlinked entitlements will not be recognized in reconciliation.
    • Subscription Step-up: Functions like step-up licenses but specifically for subscription-based software, enabling tier upgrades during the subscription term.

    Practical Implications for ServiceNow Customers

    • Understanding the specific license type is crucial for accurate SAM reconciliation and ensuring compliance.
    • Linking maintenance and assurance entitlements to base perpetual licenses is essential for correct benefit application and license tracking.
    • Utilize the Software Entitlement form’s Upgraded Entitlements tab to manage and reconcile upgrade licenses effectively.
    • Recognize the automatic application of Software Assurance and Maintenance benefits by SAM for Microsoft and non-Microsoft products respectively.
    • Subscription licenses require managing user counts from portals for compliance, especially for SaaS products.

    Related Concepts

    For detailed management of software maintenance and entitlements, refer to the related concepts of Software license maintenance and Software entitlement fields within your ServiceNow environment.

    Each license type has entitlements and conditions outlined on the entitlement form, and more importantly, these license types have a significant impact on the Software Asset Management (SAM) reconciliation process.

    Table 1. License types and their impact on software reconciliation
    License type Description Publisher applicability Impact on licensing or reconciliation in SAM
    Perpetual A one-time purchase license that enables indefinite use of the software without any ongoing or recurring payments. All This license grants indefinite use but doesn’t include maintenance rights, so benefits such as new version access, version upgrades, Bring your own license (BYOL) benefits, and technical support from the software publisher aren’t available. To receive maintenance/SA benefits, you must associate maintenance/SA entitlements with the Perpetual license.
    Perpetual + Software Assurance A perpetual license combined with Software Assurance (SA) from Microsoft offers a comprehensive Volume Licensing program with these benefits:
    • New version rights: Upgrade eligible Microsoft product licenses to the latest version at no additional cost.
    • License mobility: Deploy certain server applications on-premises or in the cloud without additional licenses.
    • Unlimited virtualization: License the physical host for products such as Windows Server Datacenter Edition, enabling an unlimited number of virtual machines.
    • Virtual layer licensing: License individual virtual machines, reducing overall licensing costs.
    		 Microsoft Software Asset Management automatically applies the Software Assurance benefits. For more information, see Software license maintenance.
    Subscription For subscription-based products like Jira, Microsoft 365, and Adobe Creative Cloud, as well as non-subscription products using subscription licenses, such as Windows and SQL Server. All (subscription products) License compliance is primarily driven by user subscriptions pulled from the subscription portal, such as Jira and Microsoft 365. It also applies to non-subscription products like Windows Server and SQL Server, which can receive Software Assurance benefits.
    Perpetual + Maintenance Perpetual + Maintenance is similar to Perpetual + Software Assurance, but it includes a maintenance agreement that provides access to software updates, patches, and sometimes support for a specified duration. This license type applies to non-Microsoft publishers such as Oracle and VMware. All Software Asset Management automatically applies the Software maintenance benefits. For more information, see Software license maintenance.
    Upgrade A licensing option that enables upgrading from a lower-tier edition to a higher-tier edition, such as Standard to Enterprise, without purchasing a new full license. All You can upgrade a lower edition of software, such as SQL Server Standard, to a higher edition, such as SQL Server Enterprise. Use the Upgraded Entitlements tab in the Software Entitlement form to link related versions of your software under active maintenance and your upgrades. For more information, see Software entitlement fields.
    Software Assurance Software assurance entitlement that provides Microsoft customers with software assurance benefits. However, it must be linked to a base perpetual license to activate the entitlements. Microsoft Software Asset Management doesn’t reconcile software assurance entitlements unless they’re linked to base perpetual licenses. Confirm that software assurance entitlements are related to base perpetual entitlements for correct reconciliation.
    Maintenance Maintenance entitlement that provides benefits to non-Microsoft customers. However, it must be linked to a base perpetual license to activate the entitlements. All Software Asset Management doesn’t reconcile only maintenance entitlement unless they’re linked to base perpetual licenses. Therefore, make sure to relate the maintenance entitlement to base perpetual entitlements for correct reconciliation.
    Step-up A licensing option that enables upgrading from a lower-tier edition of a product to a higher-tier edition, such as Standard to Enterprise,without needing to purchase a full new license. All If you're covered under Microsoft Software Assurance, you can upgrade a lower edition of software, such as SQL Server Standard, to a higher edition, like SQL Server Enterprise. Use the Upgraded Entitlements tab in the Software Entitlement form to link related versions of your software under active maintenance and your upgrades. For more information, see Software entitlement fields.
    Subscription Step-up Similar to a step-up license, this license type applies to subscription-based licenses, enabling upgrades to higher-tier editions within the subscription term. All (subscription products) Same as step-up licenses, but for subscription software only.