Licensing can be complicated, particularly when enterprises are forced to double-pay because the software they already own is only licensed for a specific environment, and moving it requires a whole different licensing model. Without proper portability rights, they need to make additional financial investments to run the same workloads in a different home.

AWS says its new Bring Your Own Media (BYOM) service eliminates this duplication. Customers can now reuse their existing Microsoft SQL Server media and licenses on Amazon Relational Database Service (RDS) with no additional licensing fees.

This means enterprises no longer have to justify workload migrations to the cloud against existing licensing commitments and infrastructure investments, AWS said.

“What used to be a licensing barrier between operational SQL Server data and agentic AI is now gone,” AWS data engineer Srikanth Katakam and product marketing manager Colleen Betik wrote in a blog post announcing the service.

Avoiding the double-licensing problem

To drive true value, agentic AI apps must have access to elastic GPU capacity as well as direct, low-latency access to the data they need to reason and make decisions. But, AWS argued, that can be difficult in self-managed data centers and on premises infrastructure with limited access to agentic AI cloud-native services. But a lot of enterprise data lives in Microsoft SQL Server, and until now customers have had to pay for a second license to use a fully managed cloud service like RDS.

Now, with BYOM on Amazon RDS for SQL Server, enterprises can reuse their existing SQL Server Enterprise Edition or Standard Edition licenses through a “lift-and-shift” model. This brings their data into a fully-managed environment.

According to the licensing distribution terms, enterprises must provide their licensed SQL Server Release to Manufacturing (RTM) media to Amazon RDS. They can then upload that media to Amazon S3 and launch BYOM instances. Enterprises must configure AWS License Manager to perform automatic instance tracking.

From there, RDS automates patching, backups, high availability, and monitoring, while providing direct access to agentic AI and analytics services native to AWS. The platform also reports vCPU usage to provide visibility into SQL Server license usage, Katakam and Betik wrote.

“You do not need to choose between protecting your SQL Server licensing investments and giving your data a path to the AWS analytics and agentic AI services redefining what’s possible in the cloud,” they said. 

It’s important to note that this service is only available to enterprises with Microsoft Software Assurance (SA), an add-on which supports mobility and rehosting of existing licenses. Enterprises must verify that their SQL Server licenses comply with Microsoft’s licensing agreement, and that they have a SQL Server License (Standard or Enterprise) with SA. They also must submit a License Mobility Verification Form to Microsoft; it, in turn, will notify AWS once verification is complete.

AWS emphasized that enterprises remain responsible for compliance; it does not block operations if license limits are exceeded.

More control over workloads, loosening Microsoft’s grip

The advantage of this service, explained Mike Leone, principal analyst at Moor Insights & Strategy, is that enterprises can get a Microsoft SQL Server workload onto a managed AWS service without rewriting it for Aurora or paying for the license twice. This means they can modernize on their own schedule rather than being forced into rewrites before they’re ready.

“For a lot of shops, that control over timing is worth more than the license saving itself,” Leone said.

This also loosens Microsoft’s grip on enterprise workloads, because organizations finally have somewhere else to run SQL Server using licenses they already own, he noted. Realistically, their dependency shifts to AWS rather than disappearing entirely, as their data ends up living next to AWS’s AI services.

“For a lot of teams, that’s a trade they’re glad to make for the managed infrastructure and the AI tooling they get in return,” Leone said.

Yaz Palanichamy, a senior advisory analyst at Info-Tech Research Group, also pointed to significant improvements stemming from the migration. Notably, it allows organizations to transition away from static, linear, or reactive storage capabilities towards more dynamically intelligent environments.

“The key is to balance the unification of transactional data towards managed AI and machine learning pipelines,” he said.

Enterprises take on new responsibilities

The catch? Leone noted that enterprises now own the task of licensing compliance. Staying current on SA, the Microsoft maintenance contract that makes any of this legal, and the license mobility rules, “become your headache instead of something baked into the bill,” he said.

Furthermore, he added, lift-and-shift has a way of turning into “lift-and-forget” when enterprises move SQL Server as-is and never actually modernize, “so you end up carrying all the old baggage onto a shinier platform.”

Palanichamy also pointed to skyrocketing AWS costs, since operationalizing AI agents requires a considerable amount of data ingestion and querying. This can potentially be cost prohibitive on RDS for SQL Server.

“One aspect to consider would be the relative time to production value, so that enterprises can better handle the management of volatile AI workloads,” he said.

Just one challenge in the AI race

Although AWS frames licensing complexity as a roadblock to agentic AI, analysts say it’s really just one piece of the puzzle.

Organizations are not in an AI-ready state due to a number of factors, Palanichamy noted. This could be total cost of ownership (TCO)-related, a lack of appropriate acceptable use policies (AUPs), or concerns around security and compliance.

If and when enterprises are ready to adopt AI, they must perform thorough needs analysis/process optimization benchmarking exercises to determine what workflows could benefit from the technology, he said, and, conversely, flag workflows where AI could prove “an impediment or potential disservice.”

Leone also pointed out that moving SQL Server onto RDS doesn’t “magically make your data agent-ready,” nor does it make it smarter. The data proximity and managed plumbing are what actually support agents. Sitting data next to Bedrock and the rest of AWS’s AI services means builders “stop wasting time shipping the data around or building one-off integrations every time an agent needs it.”

Ultimately, though, licensing isn’t the real issue when it comes to AI; it’s more of a migration problem. The real roadblocks are messy data, questionable governance, and teams that aren’t ready to run it in production, and, Leone said, “no change to a license bill touches a single one of them.”

For the past two years, enterprises have focused on grounding AI systems in internal documents, databases and knowledge repositories. Microsoft now contends that the next challenge is giving those systems reliable access to the outside world as they move into production.

At its ongoing annual Build conference, Microsoft unveiled Web IQ, a new suite of AI-native APIs designed to connect AI agents and applications to real-time information from across the web, including web pages, news, images and videos.

The goal is to help developers build more accurate and context-aware AI systems while reducing the complexity of integrating web search, retrieval and grounding capabilities into enterprise applications, the company wrote in a blog post.

The APIs already underpins grounding for Microsoft Copilot and ChatGPT, and unlike traditional search APIs are designed to retrieve highly relevant information while minimizing token consumption, helping reduce both inference costs and response latency, Microsoft said.

Reducing the cost and complexity of web grounding

That focus on reducing inference costs and response latency to deliver Web IQ’s search capabilities will be valuable for CIOs and developers, said Phil Fersht, chief analyst at HFS Research.

“Developers have typically stitched this together themselves using search APIs, web scraping, retrieval-augmented generation, vector databases, custom ranking logic, crawling tools and separate orchestration layers. That works, but it is messy, brittle and expensive to maintain,” he said.

“The hard part is not just finding a web page. It is retrieving the right evidence, ranking it, selecting useful passages, reducing token waste, respecting publisher controls and doing all this fast enough for multi-step agents,” he added.

An agent running in production will typically run at least five or ten retrieval steps and in such scenarios latency and cost can become “ugly,” said Moor Insights and Strategy principal analyst Mike Leone.

“I’ve watched plenty of teams handle this by gluing a search API onto a model and hoping the model can sort through whatever HTML comes back, which isn’t ideal,” he said.

Simplifying development of applications

Beyond the infrastructure and cost advantages, Web IQ could also simplify the AI application building process developers, said Stephanie Walter, practice lead of the AI stack at HyperFrame Research.

“The value of Web IQ is that Microsoft is trying to make web grounding a reusable, agent-native service rather than a bespoke integration,” Walter said.

That reusability, Fersht said, will matter to CIOs as most enterprises do not want every development team rebuilding its own web grounding stack: “They need a common capability that is governed, scalable, low-latency and economically efficient.”

Still, Microsoft is not entering an untapped market and there are several offerings already available, including OpenAI web search, Google grounding, Perplexity APIs, Bing Search APIs, Azure AI Search, vector databases, and custom RAG pipelines.

However, Microsoft might have an advantage with IQ, despite Google’s strength in search and web-scale knowledge, OpenAI’s tooling push, and AWS’ Bedrock-data-service-partner integrations combo, Fersht said.

“Microsoft’s differentiation is that it can combine Bing’s global web index with Azure AI, Copilot, Foundry, Microsoft 365 and enterprise developer channels,” he said.

The other advantage is the existence of existing IQ offerings, such as Work IQ, Fabric IQ, and Foundry IQ, all of which are targeted towards adding more business context for agentic systems, Fersht added.

But uptake, Walter said, will depend on whether these integrations translate into better production outcomes.

Web IQ is currently available in limited access for select Azure customers. Enterprises can request access to Web IQ via their Microsoft account team or submit a form.

Beyond direct API access, developers can also configure the model-agnostic Web IQ as an MCP tool within Foundry IQ, a Microsoft spokesperson said.