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I am installing TFS 2010, and it does not install SQL and sharepoint automatically. I am assuming I need to manually install this.
Do I need a serpeate license ontop of the TFS license?
TFS 2010 gives you a license to SQL Server 2008 Standard edition for the sole purpose of using it as a TFS Database.
The database must also be installed on the same server as TFS application tier.This is explained in detail in the Visual Studio 2010 licensing whitepaper.It is best to install SQL Server and Sharepoint (Foundation or MOSS) before you start TFS install and then TFS can be configured to use this in post-install steps. The TFS installation guide is extremely useful. I have just gone through this process myself.