Virtualized software: Confusion reigns as licensing terms run the gamut

When Dataprise, an IT services company, helped a customer with a desktop virtualization project last year, it found itself dealing with desktop virtualization's dirty little secret: No one -- including vendors -- seems to know how to license the software.

Having run a successful pilot, Dataprise's client wanted to take the next step and deploy 700 virtual desktops, says Chris Sousa, director of infrastructure service at Dataprise. That's when the trouble began. Like many businesses, the customer -- a manufacturer of fiber-optic cable -- had an enterprise agreement with Microsoft, but its IT staff wasn't sure exactly what was covered in a virtualized environment. Apparently, neither was Microsoft, says Sousa, who noted that he called the company repeatedly seeking information.

"We'd get a different answer from a different person on a different day," he says.

Sousa's experience is not unusual. In a study conducted by Info-Tech Research Group last year, Microsoft Windows licensing was the most-cited pain point for people implementing desktop virtualization, according to John Sloan, lead research analyst at Info-Tech Research Group.

Microsoft responds that it has tried to improve its virtualization pricing policies. Most recently, the software giant relaxed its licensing rules for virtual desktops and expanded rights to access a given virtual desktop from more than one computer. (See sidebar.)

The changes are "a step in the right direction," says Sloan, but he feels that Microsoft "hasn't gone as far as many would like." For example, although the new roaming rights allow users to log into their virtual desktops from devices outside of the corporate firewall, such as home PCs or airport kiosks, the virtual desktop is still licensed to a specific corporate PC. That means that a user may not be able to access his virtual desktop from another corporate PC, like one in a branch office, Sloan explains.

Confused yet? You're not alone. Even with all the changes, Microsoft licensing "is still so complicated that users and even resellers don't understand it," says Barb Goldworm, president and chief analyst of consultancy Focus LLC. Not only are the specific vendor rules confusing, but IT managers also mix up the licensing of the virtualization software (which serves as a connection broker and a virtual desktop running on a back-end hypervisor) and the licensing of the software that actually runs on the desktop (the operating system and applications).

Broader than any one vendor

But the problem is bigger than just Microsoft. All software vendors are struggling with this issue to some extent. When Citrix introduced XenDesktop 4 last fall, it changed from its traditional model -- concurrent licensing -- to one license per named user. But customers quickly complained that they needed more flexibility. In some industries, for example, multiple users share the same device.

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