The Story

Many companies are locked into massive commercial contracts for SQL Server. And while it’s a powerhouse database, the licensing costs can be crippling.

I've helped clients save millions by challenging one key assumption: Do you really need the Enterprise Edition?

This is about more than just switching to PostgreSQL. This is the FinOps roadmap we used to reduce one client's annual SQL Server bill by $1M, without compromising performance.

Here are the 4 non-negotiable levers to pull:

1. Challenge the Enterprise Edition Myth

The biggest cost driver is often an unnecessary license upgrade.

• The Myth: Standard/Web editions lack performance or High Availability (HA).
• The Reality: For most companies, the Web/Standard edition is more than sufficient and meets key SLA/HADR requirements.
• The Killer Feature You Think You Need: Online Reindexing. Many believe they need it because offline reindexing locks their system. But here’s the secret: Reindexing frequency is often over-estimated and also impacts your resources (online re-indexing is taking more resources and log more actions onto transaction log files). Focusing on statistics updates and smart data management (like partitioning) can be far more impactful than constant reindexing. We solved a major performance issue for a client with hundreds of billions of rows by partitioning and managing data patterns—allowing them to downgrade their edition and still gain performance.

2. Downsize Your CPU Footprint

SQL Server licenses are tied directly to your CPU cores. Reduce the required core count, and you cut your bill.

• For Very Large Databases (VLDBs): Implement techniques that make huge tables "smaller" to manage. This includes archiving, data partitioning, filtered indexes, data compression, and code tuning. Each step reduces the CPU resources needed, potentially eliminating hardware limitations for smaller editions. 
• For Multi-Tenant Systems (SaaS): Cloud SQL (especially on GCP) in Web Edition is often highly relevant. SaaS systems are typically web-facing (check compliance!), and the platform handles the HA/DR independently via regional disk synchronization, making Enterprise-level features (like Always-On Availability Groups) overkill.
• For BYOL/Azure-arc enabled customers, do not forget the passive nodes can be free of license cost with software assurance if done properly. 

3. Stop Paying for Overkill Parallelism (A Hidden Cost)

Be careful with multi-threading (SMT/Hyper-threading).

• While it offers a nice performance boost (up to 25% on specific OLTP workloads), the license cost often makes this boost irrelevant from a FinOps perspective.
• Key Action: Check if your cloud provider (like Google Cloud) allows you to disable SMT on your managed platform (Cloud SQL) or VMs. Turning this off often reduces your core count requirement and can improve overall performance when considering memory and disk throttling when machine shapes are too small.

4. Treat Migration as a FinOps Opportunity

Migration is a hurdle, but it unlocks massive savings beyond just licensing:

• Better Hardware, Lower Cost: New cloud-native hardware is more efficient. A newer machine type often means you need fewer CPU cores to achieve the same or better performance, directly reducing your SQL Server licensing footprint.
• Eliminate Technical Debt: Upgrade from unsupported versions (e.g., SQL Server 2019 mainstream support ends before Feb 2025). Upgrading often brings major performance improvements and reduced CPU needs due to query optimization advancements.
• Utilize Free Functionality: Leverage features like Polybase to improve interoperability with your data engineers. Use it for cost-efficient archiving to cheap blob storage, eliminating the need for expensive dedicated spark clusters for simple data movement.

5. Why You Need the "Green Berets" of SQL Server

Try to avoid the generalist partner, that knows how to do everything and that will provide generalist resources to migrate your database workloads. This is too strategic! CHDS is the the best-in-class, "Green Berets" partner.

6. The $1M-case client

The client came from AWS EC2 with 4 2-node Enterprise-edition database clusters with Pay-as-you-go edition and 64 cores for each node for 2 clusters and 32 cores for the other 2 clusters. As it is Pay-as-you-go, the second nodes were billed even though they were only use once per day for extracting data onto the datawarehouse. The total of cores licenced was then 384 cores. The monthly cost is about 104K per month, $1.25M yearly.
Even with such machine, the client struggles with performance and reindexing was maintained every day, purging mecanism was also a hog in terms of performance. The client did not know what to do while keeping the availability intact on multiple zone.

CHDS provided the expertise to move them from EC2 to Cloud SQL, upgrading the version to reduce technical debt and improve performance, downgrading the edition to standard, partitioning the tables, using filtered indexing for their real-time dashboarding, pruning the archived data rapidly and efficiently and rationalizing reindexing so appropriately that online reindexing was not needed anymore.
On top of this, we provided a disconnected read replica routine with Cloud run schedule to clone the production database onto the Development environments. We also optimize with better machines and multi-threading off and thanks to the multithreading off, we used 24-core machine types (for 24 physical cores)
This leads to a mere $1.75K per month licence per 2-node cluster (Yes! the entire cluster! the passive-node does not need licensed as part of the software assurance) which leads to an annual bill of $7k.
Simple math: savings of $1.24M per year....
And they are opening a new market this year so the optimization keeps on giving!

Conclusion

Don't let technical debt and misunderstood licensing models hold your company back.

We know modernization (to PostgreSQL) isn't always an option due to third-party software or internal team preference. The good news is, you don't have to switch to save big.

In fact, we saved this client more than a million dollars a year by applying the strategies above—and the database is running better.

We believe in this so much that in specific cases, we offer our consulting services for free in exchange for a percentage of the license cost savings! (We know we'll gain more this way, and you get guaranteed savings.)

➡️ Is your company overpaying for SQL Server? Send me a DM or connect to discuss your current footprint. Let's find your $1M saving.