1. Software Licensing for Grid and IT Utility
Presentation Title
Software Licensing for Grid and IT Utility
Kosmas Kitsos
Hewlett Packard Greece
Customer Solutions Group
April 2005

2. How does one buy an IT Utility?
Presentation Title
How does one buy an IT Utility?
What do I buy, who from, and how much?
How do I buy/pay for it?
What happens behind the scenes? (Or do I want to know?)
Should it matter how/why I consume the “utility”?
Where’s the meter?
IT Tap
IT Switch
Will IT look like this…?
April 2005
Hewlett-Packard - EGEE

3. Buying Holistic Utility Computing (cont)
Presentation Title
Buying Holistic Utility Computing (cont) ?
…or THIS? ?
With so many IT vendor participants, it could be very confusing!
April 2005
Hewlett-Packard - EGEE

4. The Utility Computing Spectrum (IDC) – there isn’t only one type of “Utility”
Presentation Title
Utility Services;
Managed Services
Purchase
Virtual Computing
iCAP/TiCAP
Lease/PPU
On Demand, Metered
Computing capacity
“Partial,” Transitional Utility Computing Model
Unforecast usage:
(Unplanned extra capacity)
Forecast usage:
(Planned extra capacity)
Flexibility
Lease
Externalize
“Comprehensive,” Mature Utility Computing Model
Purchase
Insourcing
Complexity
IDC: European Utility Computing, Forecast and Analysis, (Aug 2004) #RIO8L
April 2005
Hewlett-Packard - EGEE

5. Gartner Infrastructure Maturity Model (2004)
Presentation Title
So what does licensing look like here?
April 2005
Hewlett-Packard - EGEE

6. Licensing Nirvana This industry is probably not ready for this
Presentation Title
Own nothing
Pay only for what’s used
Tariffs for usage
Auction for peak loads
Metered usage based on:
Business processes
Rush-hour pricing
Locale discounts
Over-forecast penalties
Simple and automated payments
This industry is probably not ready for this
April 2005
Hewlett-Packard - EGEE

7. Dimensions of an Agile Licensing Model
Presentation Title
Agile or Flexible licensing could get complicated – so start simple
April 2005
Hewlett-Packard - EGEE

8. Simple economics – manufacturing fixed vs. variable costs
Presentation Title
Revenue
Variable Costs
Fixed Costs
Net: Lower costs. Now, let’s apply to licensing…
April 2005
Hewlett-Packard - EGEE

9. License provisioning vs. peak loads
Presentation Title
Does this look familiar?
Expensive “Idleware” or SLA
How do licenses map to grid use?
CPU/Resources
Time
April 2005
Hewlett-Packard - EGEE

10. Example Hybrid Licensing model – flexibility to begin the journey
Simple approach & economics
Proposal:
Buy the right number of perpetual CPU licenses for steady-state usage (fixed-costs)
Buy a pre-paid shared pool of CPU licenses (e.g. 30 CPU-days) for peak loads and/or unpredictable usage. (variable-cost allocation)
Not “pure utility”, but flexible and “good enough”
Provide cost benefit to the user -> “pull” effect
April 2005
Hewlett-Packard - EGEE

11. Fixed vs. variable licensing: A combination for Agility
Permanent licenses for steady-state usage
Pooled or floating licenses for temporary use or peak loads
CPU/Resources
Time
This is how hardware virtualization works, why not software?
Could this work for you?
April 2005
Hewlett-Packard - EGEE

12. It’s a journey – where to begin?
Mostly steady usage, with some peak loads
Ratio (steady to peak)
Sharable resources – across partitions, servers, cluster, “grid”
Examples: Software development, monthly roll-ups
Mostly steady usage, with unpredictable peaks
Steady Growth or high usage?
More fixed
Share across partitions
Low usage?
Use “soft partitions” or VMs
Ask your ISV to recognize them
Utilize WLM for SLO
Do you know what resources are being used and how much? During steady-state versus peak loads?
April 2005
Hewlett-Packard - EGEE

13. Hewlett-Packard - EGEE
Going forward…
HP is a leader in the Adaptive Enterprise, Utility Computing, and Grid solutions, and…
…is socializing “Utility” Licensing with customers and partners…
…to deliver the best holistic and agile solutions.
April 2005
Hewlett-Packard - EGEE

14. Hewlett-Packard - EGEE
Summary
It’s all about economics
Not all IT needs to be a fixed cost – it’s variable too!
“Utility” Licensing can get complex for both customers and vendors alike
Consider flexible licensing that’s “good enough” and provides value
It’s not for Grid only, but other computing styles as well.
Begin the journey
What’s next for you?
Tell us (HP and partners) what you need
April 2005
Hewlett-Packard - EGEE

15. Hewlett-Packard - EGEE
Presentation Title
END
April 2005
Hewlett-Packard - EGEE