I want to know what is the cost of running a Windows Application Server.

I know the cost of running a Linux server with Java based Application Server is probably zero.

What is the cost of running a windows based server on which all Apps are written in C#? I assume is is just the license cost of a copy of Windows Server.

Is this true? Are there any other hidden cost for hosting with WIndows?

I think with Cloud based hosting, these license costs can be avoided then.

6 Answers 6


The real costs in hosting are:

  • Power
  • Bandwidth
  • People to manage the box
  • Backups

Hardware and software amortize real, real quick.

  • 1
    This is why prices are mostly comparable in shared or VM hosting plans.
    – Jeremy
    Oct 6, 2011 at 19:25

Yes a windows license costs money, a windows server (required for some kinds of Microsoft software development, e.g. SharePoint) costs more. So does the hardware (but hardware isn't free on linux either).

There are limits to the hosting abilities of windows non-server boxes. Keep this in mind if you need IIS. Also keep in mind that Microsoft offers development versions of many of their products at a greatly reduced cost (don't buy the full edition until you close a sale to justify it).

Do you need an IDE or command line building? Free? Or Paid?
Do you need a database? What kind? Free? SQL Server? Which version of SQL Server?

If you are selling software, MySQL isn't always the best choice. Suddenly, that "free" RDBMS comes with an annual and sky-high fee.

So, to answer your question...are there hidden costs? It depends.


Yes, the only software cost is the OS. Obviously hardware costs vary hugely dependent on requirments (hosting maintenance ect)

Cloud based hosting the provider pays the OS licence. That cost is then passed on to you in the monthly charges. You should only go with cloud hosting if it meets other requirements (scalability low startup cost ect)


There's the cost of the production server, Integration, Test & Development servers can be licensed under the terms of MSDN if EVERYONE that touches the server has an MSDN licence. Build servers count as production so need to be licensed separately.

So, to have a MS development environment you need:-

  • At least 3 Windows Server licences (one for production, one for SQL Server & one for build) probably more if you want redundancy.
  • One Visual Studio + MSDN licence for every developer (I believe it's OK for contractors to have their own MSDN & attach to your servers)
  • One MSDN (probably involving the Test suite) for every tester
  • One MSDN for any sysadmins that administer the DB &/or servers
  • CALs for internal users that attach to SQL Server

Sharepoint's extra Team Foundation Server's extra...

Linux isn't free if you want enterprise support, neither is MySQL. You can get away with a completely free stack and only buy things that you feel add value e.g. IDE, support etc.

For a very small company the initial cost of the MS licencing is probably an issue, however, as a percentage of the employment costs of a team of developers it's pretty modest.

Which way you go probably comes down to availability of programmers where you are.


This is what I remember from training about MS licensing. It is probably not be 100% correct but I believe it is close:

In case of MS Software it is more complicated than it looks like. MS Windows Server license doesn't have to be enough. MS as many other companies also uses client access licenses (CAL) = you must pay for every client accessing to your server.

When dealing with CALs you can have multiple options:

  • Per user CAL - each authenticated user must have his own CAL
  • Per device CAL - each connecting device must have its own CAL
  • External connector - usually for Internet where you don't pay for every authenticated user but simply buy (some very expensive) license for everyone. External connector should not be needed for anonymous users.
  • Special cases
    • Per processor licenses don't require CALs for end users (for example SQL server)
    • Special server types don't require CALs (for example Windows Web Server 2008)

More about CALs. CALs are most commonly purchased in some Volume licensing plans because it reduces their price a lot.

Some example how it can be:

You join a company where you will use your desktop machine running Windows 7 Enterprise + Office 2010. You will also use MS Exchange and MS Sharepoint. You need:

  • License for Windows 7 Enterprise
  • License for Office 2010
  • CAL License for Windows Server because both MS Exchange and MS Sharepoint are running on Windows Server (one CAL user call per product can be used to connect to every instance of the product => the price of CAL is same if you need to connect to single Windows Server or to 100 Windows Servers within company).
  • CAL License for Exchange
  • CAL License for Sharepoint
  • SQL server used for Sharepoint must use per processor licensing or you will also need CAL to SQL server

Price of CALs differs per server version so CALs for Enterprise versions are much more expensive than CALs for Standard versions.

Another example:

You want to run Windows Server hosting your business application which internally connects to MS CRM and MS SQL. The application requires user to authenticate. You need:

  • Windows Server license for App Server, CRM and SQL
  • CRM license
  • Per processor SQL license
  • External connector for Windows Server Enterprise
  • External connector for CRM because you exposing information from CRM to external users

So as you can see the licensing costs can be very different per application and requirements. The important is that these costs should bother you only if you host the application on the servers where you are responsible for licenses. In shared hosting / VS hosting / or cloud it should not be the case because you pay for hosting plan which should already offer you SW with correct licensing.

Edit: There is also possibility that hosting companies have different licensing options.


There is the cost of the room that it is in, as well as cooling that room. Look at the specs for the server and find the max power usage and multiply that by the electricity price per Kw/H then multiply that by a period of time, say a year to get that running cost.

You need to allow for hardware failures and replacements as well, this will probably be hard drive failures.

These costs are the same irrespective of OS - the only difference between OS choices is licensing cost and the cost of getting skilled staff.

The cloud benefits from economies of scale, so if you have a small set-up you may save some money going to the cloud. But there will come a point where your size is such that you can get the same economies of scale and hence save on the cloud vendors profit margin.

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