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Microsoft Exchange Server – License Myth – for Hybrid deployment / O365 federated domains

Hello there,

Most of you guys i know looking for this information, day and night, when you have an Office365 deployment with your federated domain. I am writing this blog to give all administrators/licensing managers like us; should not have a second taught, when Microsoft licensing team don’t know what we are talking about.

Snip20140312_2Federated domain…haaa…. Too sensitive. Many organizations have chosen to configure a hybrid deployment with Exchange Online (Office365) to take advantage of different features such as rich mailbox moves and cross-premises calendar free/busy sharing. This includes Exchange 2003, Exchange 2007 and Exchange 2010 organizations that require a long-term hybrid configuration with Exchange Online and organizations that are using a hybrid deployment as a stepping stone to migrating fully to Exchange Online.

This article will give you an insight of what this is, and the pros and cons for why we need Exchange bridge/hybrid server On-Prem…read the conclusion as well 🙂 . Now in this case to bridge the coexistence between O365 and On-Prem, we need an Exchange Server in between.

In earlier stage, when you deploy Office 365, and a customer using a hybrid Exchange 2010 solution, got a “co-existance” exchange server license in E-plans for free. The caveat with that license is conditioned to CAS-only, that no local “on-the-on-prem-hybrid-Exchange-2010”  mailboxes are allowed/possible. It does exist to support Hybrid deployment.

What does Exchange Hybrid deployment mean? : Maintain rich coexistence with Exchange Online and an Exchange on premises installation.

What versions of Exchange server support Hybrid deployment? : Exchange 2013, Exchange 2010, Exchange 2007, Exchange 2003.

What functionality do you get with Exchange Hybrid deployment?

Exchange Hybrid mode enable the following rich coexistence:

  • Mail routing between on-premises and cloud-based exchange organisations.
  • Mail routing with a shared domain namespace. For example, internal SMTP domain.
  • A unified global address list, also called a “shared address book”.
  • Free/busy and calendar sharing between on-premises and cloud-based exchange organisation.
  • Centralised mailbox management using the on-premises Exchange Management Console (EMC).
  • Centralised control of mail flow. The on-premises  can control mail flow for the on-premises and cloud-based organisations.
  • A single Outlook Web App URL for both the on-premises and cloud-based exchange organisations.
  • The ability to move existing on-premises mailboxes to the cloud-based organisation.

Are you able to get an answer from anyone regarding this issue, including from the licensing expert from Microsoft? I was also wondering whether Microsoft was going to continue to offer a free “hybrid” license of Exchange 2013. It is concerning that no one can answer this simple question…

SO the answer to our question is…..

If the on-premises Exchange is only used for hybrid and management and doesn’t host any mailboxes, you should bear in mind that you aren’t required to pay for the Exchange license. Windows server license as it then would be covered by the Exchange Hybrid edition license. With Exchange 2013 you don’t have to enter a product key.

“If you are installing an Exchange 2010 server solely to act as a bridge between the legacy Exchange Server 2003/2007 on-premises environment and Exchange Online, you can request a “Hybrid Edition” server key to license the server.”

If you dont have any present versions of Exchange on prem, you have to buy/pay for the on prem Exchange which will act as the “bridge server”

For further details, see the Exchange Online licensing FAQ here. To know about the exchange licensing, click here.

How to get Exchange Hybrid Server Edition for Office 365 Coexistence

  1. Download Exchange Server
  2. To obtain a Hybrid Edition product key, contact Office 365 support.
  3. Install Exchange  Server
  4. Provide an Exchange 2010 Hybrid Edition product key on the hybrid server when you configure a hybrid deployment with Office 365.

It took a lot of time to research this subject and come to a conclusion..i’m here to share to our community.


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