You may have heard about “Office 365 equivalency rights” or “dual use rights”. These rights allow users to access on premises servers, such as Windows Server, Exchange Server, SharePoint Server, and Skype for Business Server using their Office 365 E3 or E5 licenses.

Office 365 equivalency licenses only provide user use rights, not server rights. In other words, O365 licenses are equivalent to Exchange Server Client Access Licenses (both Standard and Enterprise) and Windows Server CALs, but you still need server licenses to run Exchange Server on Windows Server on premises.

One exception to this rule is that your Office 365 subscription let’s you use the free hybrid key to run an Exchange hybrid management server. An important caveat here is that the hybrid server cannot be used to host user mailboxes and you may still need a server license for Windows Server. The free hybrid key is available to all Enterprise Office 365 customers, even if they get their license from the CSP channel which says it’s “Not On Premises Capable — Cloud only rights”.