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How does user licensing work when a new SBS 2000 becomes PDC and old PDC is demoted?

I have a network in which a completely new SBS 2000 will be installed. Being SBS, it must be the Primary Domain controller, a job currently being done by a Windows 2000 server which also runs SQL Server 7. The existing W2K server has licenses for 30 W2K server users as well as licences for 30 SQL Server users. The purpose of the SBS is to provide Terminal Services to users at a remote site, with a maximum of 10 such users. None of my existing users need to use the Terminal Services.

My question is, what happens to the 30 W2K user licences on the existing PDC? Do they disappear when the existing PDC is demoted? If so, can I migrate them to the SBS 2000 prior to the demotion, or do I need to buy and add 25 SBS user licences to the SBS server in order for my users to log in and use the services of SQL Server 7>
1 Solution
William PolymenakosVice President, PartnerCommented:
Windows 2000/2003 Server does not have the PDC/BDC concept that NT Server 4 did.  All domain controllers operate in a multiple master configuration.  While there is a "PDC Emulator" Operations Master role to handle certain functions for which multiple master will not work, DCs do not have the PDC/BDC relationship.  You also can not "demote" a Windows 2000 DC because they're all equal.

If you are using per-seat licensing then your client computers are allowed access to ANY server within a W2K-based network as long as each client machine is licensed with the appropriate CAL.  Taking it a step further, Windows Server 2003 introduced the option of per USER CALs so you're not tying devices to CALs - a user can be licensed with a CAL and access the network servers using any combination of devices (desktop, laptop, PDA, Smart Phone, etc.).

If you are using per SERVER licensing then it's a whole different situation.  Paraphrasing from the Microsoft web site, in per server licensing you must have enough W2K CALs (or application server CALs such as SQL) dedicated to that server to accommodate the maximum number of clients that will connect to that server at any one point in time. The server assigns CALs temporarily to client computers - there is no permanent CAL associated with a specific client machine. If a network environment has multiple servers, then each server must have at least as many CALs dedicated to it as the maximum number of clients that will connect to it at any one point in time. You have to pre-designate the number of CALs that apply to the server during setup.

If you're using per server licensing then since you don't "demote" a DC in Windows 2000 any licenses you have should stick with the server.  Based on your description I'm guessing you're using per server licensing.  If you're using per seat licensing then the whole argument is moot since licenses aren't stored on the server - it's more of an excercise in documentation to ensure you're fully licensed.  Now, to add more complexity, a Terminal Services CAL is a COMPLETELY different CAL license and purchase.  Your 10 remote site users would have to be licensed with Terminal Services CALs in order to use TS.  And they would still have to have W2K CALs (either per seat or per server) in order to establish a connection to a DC for authentication.  I'd check the specs for SBS 2000 to see what it includes - the TS CALs may already be in there.

I hope this helps.  Understanding licensing can be a career path unto itself.

Best regards: Bill

jdgressettAuthor Commented:
OK, I waited until all of my users had gone home and I reconnected the new SBS 2000 system to the network. Nothing unusual happened, and I found that I could configure an ODBC connection to SQL Server 7 and I could also use the Enterprise Manager installed on the SBS 2000 to access the SQL Server 7 database. I could also see all of the workstations in the domain in My Network Places. I have a problem with my application software, but I will take that to the vendor's tech support.
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