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Terminal Server Licensing

Applies To: Windows Server 2003, Windows Server 2003 R2, Windows Server 2003 with SP1, Windows Server 2003 with SP2

Terminal Server Licensing

A valid license, issued by a Terminal Server license server, is required before a client is permitted to log on to a terminal server.


  • The Terminal Server Licensing method is separate from the licensing method used for Microsoft® Windows Server 2003 operating system clients. For more information on licensing for Windows Server 2003 operating systems, see Licensing.

A license server stores all client licenses. A terminal server must be able to connect to an activated license server before clients can be issued permanent licenses. When you activate a license server, Microsoft provides the server with a digital certificate that validates server ownership and identity. By using this certificate, a license server can make transactions with Microsoft and receive client licenses for your terminal servers. If you install a license server but do not activate it, that server only issues temporary licenses.

For small deployments, it is acceptable to install both the terminal server and Terminal Server Licensing on the same physical computer. However, for larger deployments consider installing Terminal Server Licensing on a separate server. Note that one license server can serve many terminal servers concurrently.


  • You must configure Terminal Server Licensing correctly in order for your terminal server to continue to accept connections from clients. To allow ample time for you to deploy a license server, Terminal Server provides a licensing grace period, during which no license server is required. During this grace period, a terminal server can accept connections from unlicensed clients without contacting a license server. The grace period begins the first time the terminal server accepts a client connection. It ends after you deploy a license server and that license server issues its first permanent client access license (CAL), or after 120 days, whichever comes first.

Before installing the license server, determine which of the two license server roles you require—a Domain license server or an Enterprise license server. By default, a license server is installed as an Enterprise license server. For more information, see Terminal Server license server roles.

After installing the license server, you must activate it and install CALs by using the Terminal Server License Server Activation Wizard. For information about activating a license server, see Activating a Terminal Server license server.

The following resources provide additional information about Terminal Server and Terminal Server Licensing.


  • You can use any computer running one of the Windows Server 2003 operating systems to administer servers remotely with Remote Desktop for Administration (formerly Terminal Services in Remote Administration mode). You do not need to install Terminal Server. A Terminal Server license server and the Terminal Server Licensing administrative tool are not required for Remote Desktop for Administration. For more information, see Remote Desktop for Administration.