When good intentions, good will and sincerity lead to licensing nightmares and financial waste

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by | March 19, 2021


Working for 20 years in SAM, I have come to the conclusion that the best efforts from everybody to reach high performance of IT infrastructure and fair licensing rules leads to incredible complexity in SAM, stress for SAM teams and over spend in licenses.

Licensing complexities—by design?

Licensing keeps many people busy. Software publishers work with product managers working full time to create incredible licensing rules. SAM consultants work at ridiculous daily rates trying to interpret the rules and work with companies to make sure that they are compliant and won’t suffer from audits. Is licensing complex by nature? What mysterious and underground laws rule the licensing world?

Let’s begin with some logical assumptions

The starting point from this situation is a fair statement: “Companies should pay for their actual use of applications.” From this viewpoint, a more powerful server must pay more than a smaller configuration. Likewise, a user accessing more functionalities needs to pay more as well for a per user application.

All vendors have created their own fair rules. However, technology and business complicate the picture.

Technology. In a good will of delivering the best service and reliability, technologies have become increasingly complex.

Multithreading: for processors incorporating more and more cores

More flexibility:

– Flexible virtualization: in 2010, vCenter designed to allow virtual machines to consume hardware resources from any host in a cluster.  From there, from the vCenter—or even now from any Host hosted in any vCenter
– Customization of applications has also provided more flexibility. For instance, in SAP, it would be common to see more than one million possible transactions (ABAP programs accessible to users or scripts, many of them being custom) available on a single system

Business. Account managers in software companies are constantly under pressure to make their quotas on markets that are increasingly more mature. In this environment, a new sale is often complicated.

Because of this, software publishers have created incredibly complicated rules—like the ones listed below—that are making a simple tracking of the used licenses impossible. At the same time, they have augmented the pressure on their customers through tough audits.

The fair rules that can be mentioned are the following:

Oracle with the interesting and famous soft partitioning rule using an Oracle factor:

The Core factor is computed with a variety of parameter (the number of cores per processor, processor type and even purchase date of the servers for Itanium that visibly became more powerful in 2010)
Any installed virtual machine with an Oracle Product requires the full cluster that hosts its Physical server on vCenter 5.0 versions. The full vCenter is required for 5.1 – 5.X, and even now all vCenter with vCenter 6.+. It is common to see discussion on tens or hundreds of millions of dollars of liability identified during Oracle’s audits.

Microsoft Mobility does not exist on Windows Servers. Any license that has “covered” a physical server hosting Windows virtual machines has to be available for 90 days on the host. Imagine that virtual machines are moving every day across hosts—this makes it difficult to apply this rule.

IBM sub-capacity is a nice one, too. An installed server inventoried by a certified inventory source (such as ILMT or a Flexera Inventory Agent) that scans and measures the number of cores—eventually capped—every 30 minutes can be measured for their PVU consumptions using the “simple” sub-capacity rule.

– A PVU factor (of 70, 100, 120 points) will be computed according the Processor type, the number of cores per processor, the server model, and so on
– Each installed virtual machine/server will be measured for its number of cores and PVU consumption every 30 minutes
– Bundles (that vary over the time) are authorized, and primary applications also cover supplementary applications. Imagine the matrixial situations with 200 products that have n-n primary/supplementary relationships
–  You need to catch the peak of each product of successive quarters—and keep history of all consumptions for two years.

SAP also has its fuzzy rules on licenses that represent millions of dollars for its customers. Reference the SAP Licensing— translate 50 expensive shades of grey into cheaper black and white! blog post.

I could extend the list and make this post a book. The long story short is that customers are suffering with million dollars audits based on impossible to decrypt licensing rules that they are not armed to face.

The easy way is to license all ESX servers with Windows Server DataCenter edition. Then, aim for an Unlimited License Agreement (ULA) with Oracle, take an “all you can eat” agreement with SAP or License in full capacity if you don’t have ILMT.

All these decisions give you peace of mind, but not financial happiness.

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