Managing License Compliance in Virtualized Environments

By Steve Butler
published: Wednesday, April 08 2009

The Rise of Virtualization Technology

Datacenter server virtualization is one of the hottest trends in IT today.  The adoption of this trend has resulted in benefits including better utilization, flexible performance and load balancing, as well as reduced power consumption.  Datacenter server virtualization saves space, power and hardware costs for thousands of enterprises by consolidating physical machines. The reduction in the number of physical machines is achieved by increasing hardware (CPU and memory) utilization from a typical 10-15% to as much as 75-85%.  In addition to the savings on hardware purchases, there are reduced cooling requirements and maintenance cost savings associated with fewer machines. Energy cost savings have been estimated to be in the range of $300 to $600 per year for each server that is eliminated by virtualization. The total savings can be in the millions of dollars per year for large enterprises.

Server virtualization has broken the bonds of legacy datacenter IT architecture in which a single application and a single operating system (OS) run on each server. In the virtual datacenter, multiple applications and operating systems can run securely on one server. It is this capability that allows hardware utilization to increase dramatically. The trend is to take it a step further and create pools of shared hardware resources that include not only multiple servers (compute resources), but also I/O and storage resources, that can be efficiently and dynamically allocated to many virtual machines. This virtual infrastructure provides increased flexibility, high availability and scalability to meet today's enterprise datacenter needs.

Server virtualization allows multiple software instances of a computing platform to run concurrently on one physical machine.  These virtual machines (VMs) are capable of running an operating system and a set of applications. Each VM may run a different OS -- Windows, Linux, UNIX, etc. -- or different versions of the same OS, depending on the needs of the software applications. This provides tremendous flexibility and security. The dominant approach to server virtualization is through a thin software layer-hypervisor-between the physical machine and the VMs. The hypervisor is installed on the "bare metal" of the server, taking the place of the traditional OS. Hypervisors dynamically allocate hardware resources to each VM. This is the approach taken by the leading server virtualization solutions from VMware (ESX Server), Citrix (Xen) and Microsoft (Hyper-V).

The Implications of Virtual Environments for SAM

While there are many benefits to virtualization, there are also a few challenges. Virtualization has increased the risks and complexity of software licensing. Every time a virtual machine is created, or moved, it has a software licensing implication.  Organizations run the risk of non-compliance as operational decisions are made about the deployment of virtual machines.

The financial exposure from software license breaches in a virtualized data center is high because of the value of applications running on these virtual machines. Organizations typically spend about 30 percent of their IT budget on software purchases and maintenance, and many spend more than half of this in the data center. At the same time, virtualization lifecycle management tools make it as easy as the click of a mouse button to create, run or move a virtual machine, usually bypassing the traditional procurement and deployment controls associated with physical servers.  Taken together, software license non-compliance in the virtualized data center constitutes a high likelihood and high impact risk to an organization.

There has been a range of responses to virtualization by various software vendors. Some have done nothing to adapt their license models to support virtualization, while others have modified their licensing to be more "virtualization friendly." Other vendors have done a bit of both. So, software license agreements often have terms and conditions that can be problematic for various virtual environments in which the application may run. These terms and conditions make software license management even more complex and nearly impossible to handle without automation.

License Compliance Drift

The ease of spawning new VMs allows the rapid multiplication of installed software applications and increases the risk of license breach. Compounding this risk are the license rules set by publishers for virtual environments, as mentioned above. Some licenses require knowledge of the number of VMs associated with a given physical server. For example, a given application (or operating system) may be entitled to be installed on up to 4 VMs per physical server. Other software licenses require knowledge of the underlying physical hardware, such as the processor speed, number of processors and/or the number of cores. This can be difficult because the physical hardware may be hidden from the virtual environment by the hypervisor.

Dynamic virtualization, where running VMs can be moved from one physical host to another, further complicates license compliance. Software licensing that is bound to physical host CPUs, may result in an enterprise becoming non-compliant, if a VM is relocated to a different physical host with more CPUs. Some software vendors place license restrictions on the frequency of application transfers from one server to another (mobility restrictions) thereby compounding the risk of compliance drift. Since applications are contained within a VM, it's easy to violate this mobility rule and drift out of license compliance.

Clearly, tools are required to achieve and maintain license compliance. Enterprises should implement SAM programs that provide license reconciliation between what was purchased and what applications are installed on both physical and virtual machines from the desktop to the datacenter.