Virtualisation licensing proving a tricky issue

Paying for virtual servers raises many questions

For all the flexibility that server virtualisation affords today’s IT departments, there’s one type of flexibility IT managers would love to have but aren’t likely to get: the ability to save money on Microsoft software licences. Even when carving a physical server into multiple virtual machines, customers using virtualisation probably won’t find any way to circumvent the licensing terms set by Microsoft for software running on virtual machines, Forrester analyst Christopher Voce said at Forrester’s recent IT Forum in Las Vegas. “If you are getting any benefit from Microsoft’s software, you need to have a licence, whether that benefit is for physical machines or virtual machines,” Voce said in a session titled “Microsoft Licensing in a Virtual World.” “You cannot engineer your way around licensing requirements," he said. "You can’t use the technology as a way to cut corners around licensing”. Some customers are trying to cut corners, though. A recent Burton Group report said customers of numerous software vendors deal with support limitations by “accidentally” failing to disclose that an application is running on a virtual machine, or by cloning virtual machines to a physical server before calling support. One question is whether Microsoft intends to use licensing policies to steer customers away from VMware’s hypervisor and onto its own upcoming server virtualization software, Hyper-V. Two audience members who are rolling out desktop virtualisation initiatives reported that Microsoft would charge them extra for operating system licences if they use VMware or Citrix rather than Microsoft’s own desktop virtualisation software. While Voce said there’s no way to “engineer” a way around licensing requirements, there are ways to save money by carefully evaluating Microsoft’s terms. Microsoft offers several licensing models for Windows Server 2008. The standard model, Voce said, grants one virtual machine per licence. The enterprise model allows four virtual machines per licence. The datacentre model prices are based on the number of processors. Datacentre licences cost less than the alternatives when running 10-20 virtual machines per server, Forrester research has found. When negotiating new licences for virtual servers, users should push Microsoft for more favorable trade-up conditions, Voce said. Microsoft’s Software Assurance, the maintenance program that allows users to spread payments out over several years and get free upgrades, can offer some good terms for virtualized environments, he said. With desktop virtualisation, Software Assurance can allow a user to work at home or in the office without needing an extra licence, he said. Despite customer frustration, Microsoft might be among the friendlier companies when it comes to virtualisation licensing terms. The Burton Group report said Microsoft is one of five management application vendors that provide virtualisation-friendly licensing, along with HP, Opsware, Sun and Symantec. However, the analyst firm also said Microsoft does a poor job in licensing virtual instances of client/erver and middleware products. Microsoft customers who use Exchange Server 2007 and SQL Server 2005 are allowed to move virtual machines between physical servers only once per 90 days, Burton noted. For Windows Server 2003, Burton said Microsoft generally offers good licensing terms, except when it comes to moving a virtual machine from one physical server to another. This requires a licence transfer. Burton analysts argue that punitive licensing terms may stall adoption of server virtualisation. Examples range from supporting only certain hypervisors to tying licences to specific hardware components or penalising customers for maintaining offline copies of virtual machines for disaster-recovery purposes. James Norwood, vice president of product marketing at Epicor, noted that customers are asking for better licensing terms on virtual servers. “Our customers are asking for it,” he said. “We are a Microsoft shop but all our customers are heavily invested in VMware. It’s a challenge.” Norwood was speaking at another Forrester session that covered several topics related to software licensing. The panel also featured Microsoft’s Jason Kap, general manager of licensing and pricing, who said vendors want to prevent getting short-changed when customers move to virtualisation. Applications still have value to the customer, even if they are running on a virtual machine rather than “on metal”, he said.

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