Discovering that your company is six times short on software licences is a nightmare scenario in which no IT manager would wish to find themselves.
But, according to research from software asset management (SAM) vendor License Dashboard, it is one that many organisations are risking when licensing virtualised environments.
Increasingly frequent vendor software audits, coupled with growing confusion over software requirements, are leaving end users open to hefty non-compliance fines, License Dashboard claimed.
To remain compliant during software audits, many end users are trying hard to get their heads around correctly licensing virtual environments.
But this may not be as simple as it sounds, with channel onlookers citing inconsistent vendor licence terms, ever-changing rules and profiteering from vendors as just the tip of the iceberg when it comes to the problems surrounding virtual licensing.
Ignorance is not bliss
Dan Hobson, commercial director of reseller Codestone, said end-user ignorance and lack of available reseller training have added to the problem.
“There is a fair amount of blissful ignorance as to how end users license their [virtualised] products, and it is born of vendors making licensing schemes and EULAs [end-user licence agreements] very difficult to interpret; there are too many different ways of licensing the same product,” he explained.
“For example, with Office, there are about 20 different ways of licensing it. In the reseller comm-unity, there is a fundamental lack of training [on virtualisation licensing], especially [from] Microsoft.
"It is a frequent occurrence for us to call our account manager and still not get a clear answer on the most effective way to license; they do not know themselves sometimes. That is not conjecture, it is fact.”
He added that frequent changes in licensing terms add to the confusing picture.
Kelway’s head of SAM and licensing Gareth Johnson agreed, claiming that confusion among end users is rife.
He said: “We have about eight to 10 customer audits a month from Microsoft, and we have never had one which has been 100 per cent correct. All customers have difficulties in understanding virtual licensing and SAM… A lot of it was born from the snow a few years ago when people wanted to work from home.”
He added that while mobility is increasingly important for customers, the licensing quandaries it can throw up can be critical due to confusion over the difference between user and device licence terms.
“Mobility is so important…but people do not realise that requirements change. If, for example, I am at home logging on to my desktop, if Office is licensed to my device at work, my organisation would also have to get one for me to work from home too.
“The only way around this is Software Assurance, and at about £400 per user, you can see how that number soon ramps up. There are a lot of things that catch out organisations, and the majority of these are around virtualised servers and desktops,” said Johnson.
Meanwhile, vendors have been accused of not helping the situation by deliberately attempting to profit from the confusion.
According to Gartner research last year, 65 per cent of respondents to its survey recorded having at least one software audit in the past 12 months, up from 61 per cent the year before.
The License Dashboard survey also showed that audits are becoming more common, with more than two thirds of those asked saying they were audited once in 2012, and 16 per cent saying their doors were knocked on three times.
License Dashboard’s business development manager Matt Fisher described virtual licensing as the “number one route to non-compliance” and said vendors are all too aware of this.
“For many organisations, because they cannot do the complex calculation of how many licences they need, they are taking huge risks as they are just guessing. We know that vendor audits are very common, and where virtualisation is identified within target organisations, that is when the pencils start getting sharpened,” he claimed.
While vendors can perhaps not be blamed for wanting to be rightfully paid for the software deployed among end users, some channel onlookers believe that confusion over licensing virtualised environments is lucrative for vendors and their partner compliance organisations.
Codestone’s Robson added: “There are organisations out there which exist to ensure compliance, but they are just sponsored by vendors to try to interpret [the licences] and generate revenue from [end users].”
Paul Davis, managing director at a company specialising in recruitment of SAM professionals, MerlinCorp, said vendors thrive on “fear, uncertainty and doubt” when it comes to virtualisation.
And reseller Softcat’s head of SAM, Matt Ward, said that with licensing, some vendors believe “where there is mystery, there is a margin”.
He added that inconsistent vendor rules mean end users are fighting a losing battle.
“It is impossible for end users to do [virtualisation] licensing themselves. There are different rules for different vendors and different technology, and more and more [end users] are leaning on their partner to help them – it is nigh on impossible to do it themselves,” Ward said.
Although channel onlookers lament the state of virtualisation licensing and the audit process, Microsoft’s head of anti-piracy, Michala Wardell, claims the audit process can be a positive one for all involved.
She also reckons that, despite initial fears from end users, it can reconnect them with their resellers and bring additional peace of mind.
She said: “In lots of situations, from a customer point of view, they initially might think ‘oh no’ as a software review was not planned, but often, we find customer satisfaction goes up dramatically afterwards.
“Customers fully understand what they have and are reconnected with their reseller. They truly understand [their assets] and gain peace of mind from that. They know they tick the right boxes and how to move forward, as well as upgrade opportunities in a lot of cases. Some have a software shortfall, but others have too much. It is a positive experience for our channel and customers.”
And it is not just the vendors which claim to be offering a helping hand when it comes to getting to grips with virtualisation licensing.
Softcat has launched a scheme to provide its customers with licence certificates to pre-empt vendor audits. Ward said proving that end users are up to date and compliant relieves the pressure of such investigations.
The random nature of software audits often requires firms to drop their normal workload just to satisfy audit criteria -- something for which Ward claims the certification scheme negates the need.
Reseller Bechtle’s software manager, Richard Gibbons, agreed that end users are becoming more reliant on their VARs, and said confusion thrives when companies try to go it alone.
“Anyone who has been with us for a good few years will be fine. If they have followed our advice and done what we advised, they will be in a great position. It is when customers have grown organically that there are problems; there is no continuity, and confusion tends to happen,” he added.
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