For Hosting Providers Running Microsoft Products, "Dedicated" Means "Dedicated"

As discussed previously, providers of software hosting services may deploy on their servers Microsoft products licensed by their customers under two different scenarios, one of those being where the hosting provider has dedicated a physical server for use by the customer providing the licenses. However, providers thinking of taking advantage of this option need to tread carefully.

The license terms allowing for this type of deployment scenario are found in the Product Use Rights incorporated in the customer's volume license agreement with Microsoft. On this point, the PUR states:

You may install and use permitted copies of the software on Servers and other devices that are under the day-to-day management and control of third parties, provided all such Servers and other devices are and remain fully dedicated to your use.