Virtualization Licensing Adapts to New Challenges

Virtualization technologies, with their capability to spawn new machines without hardware, pose a significant challenge to Microsoft’s device-oriented licensing policies. The company has adapted somewhat, changing policies to accommodate new developments and to lay a better licensing foundation for its own virtualization products. However, the changes have been inconsistent and still impose some limits on companies that want to exploit the technology to its full potential.

Microsoft’s virtualization rules generally apply regardless of whether customers use a Microsoft hardware virtualization product—currently Virtual PC 2007 for desktops, and Virtual Server 2005 R2 for servers—or a product from a competitor, such as VMware or Xen. However, licensing rules may have a different impact on competitive software than they do on Microsoft products, by placing restrictions on advanced capabilities that competitors currently offer but Microsoft does not. Both Microsoft products are free downloads, and Virtual Server can run either desktop or server workloads, but Virtual Server launches virtual machines (VMs) at system startup time and has features such as better multiprocessor support, remote management, and more available memory per VM, which make it more suited for server workloads. The company also has an OS virtualization product, SoftGrid, acquired in the purchase of Softricity, but this article will focus primarily on licensing details applicable to hardware virtualization.