Microsoft Exchange Server Subscription Edition Launches with New Licensing and Upgrade Paths

Microsoft has officially released the Exchange Server Subscription Edition (SE) on July 1, 2025, marking a significant shift in its on-premises email server offerings. This new edition is set to replace Exchange Server 2016 and Exchange Server 2019, both of which will reach the end of support on October 14, 2025.
Key Features and Changes in Exchange Server SE

• Subscription-Based Licensing: Unlike previous versions that operated on a perpetual licensing model, Exchange Server SE introduces a subscription-based model. This aligns with Microsoft's broader strategy of transitioning its software products to subscription services.
• Modern Lifecycle Policy: Exchange Server SE is governed by the Modern Lifecycle Policy, meaning support will have no fixed end date as long as customers keep their configurations up-to-date. This approach ensures continuous servicing and eliminates the need for major, year-numbered versions.
• In-Place Upgrade from Exchange 2019: Organizations running Exchange Server 2019 CU14 or CU15 can perform an in-place upgrade to Exchange Server SE. This process is described as being "identical to installing a CU," making it a low-risk operation.
• Coexistence Limitations: Exchange Server SE does not support coexistence with Exchange 2013. Organizations must remove all Exchange 2013 servers before installing Exchange 2019 CU15 or Exchange Server SE.

Licensing and Pricing Updates
Microsoft has announced several pricing changes effective July 1, 2025:

• Standalone Server Licenses: Prices for standalone on-premises server products, including Exchange Server SE, will increase by 10%.
• Core CAL Suite: Prices will rise by 15%.
• Enterprise CAL Suite: Prices will see a 20% increase.

These changes apply exclusively to on-premises versions and do not impact pricing for Exchange Online or Microsoft 365 services.
Upgrade Paths and Recommendations
For organizations currently using Exchange 2016 or 2019, Microsoft recommends the following upgrade paths:

• From Exchange 2019: Install CU14 or CU15 and then perform an in-place upgrade to Exchange Server SE.
• From Exchange 2016: A legacy upgrade involving building out new infrastructure and migrating mailboxes is required.

Given the impending end of support for Exchange 2016 and 2019 in October 2025, organizations are advised to plan their migrations to Exchange Server SE promptly to ensure continued support and security updates.
Conclusion
The release of Exchange Server Subscription Edition represents a pivotal change in Microsoft's approach to on-premises email solutions, emphasizing continuous updates and a subscription-based model. Organizations should assess their current Exchange environments and plan their upgrade strategies accordingly to align with these new developments.

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Source: BornCity Exchange Server Subscription Edition (SE) release (July 1, 2025) | Born's Tech and Windows World