Andy Ellwood, iQuate
By correctly interpreting the complexity surrounding Oracle usage and licensing, iQSonar delivers accurate information relating to ALL aspects of an Oracle deployment.
This was illustrated by an engagement with a large Irish financial institution, in which iQSonar scanned Oracle on several hundred Solaris machines. One of the servers running Oracle Enterprise Edition had a single Sun UltraSPARC-T2 quad core processor. Each of the 4 cores had 8 threads. Under Oracle licensing policy this type of processor has a core factor of 1, so it requires 4 processor licenses. At current Oracle list price a one processor license for Enterprise Edition is $47,000, so the correct list price for Oracle on this server is $190,000.
The manual audit performed by the customer had stated that the server had 32 processors (as indeed did the CPU Highwater recorded in the Oracle database). Licensing for 32, rather than the required 4 license would represent a list license cost of $1.71m.
On another occasion, Oracle License Management Services were engaged with a UK Law Enforcement agency with unique security and operational requirements.
Owing to this complexity – and the size of the network (over 10,000 network devices) – various manual and agent based automated attempts to identify their Oracle deployment had not been successful. This increased the risk of non-compliance and of inefficient utilization of purchased licenses. These issues had also delayed the submission of complete audit data to Oracle by several months.
iQuate completed the audit in just five days without any network, performance or security issues. The customer now has an accurate view of their Oracle usage and was able to report their position back to Oracle LMS.
Finally, after performing a successful Oracle scan for a US based multi-national petroleum organisation across their global WAN network, iQuate was asked to use iQSonar to check some additional operational issues.
As part of their SOX-compliance guidelines, no default or “obvious” Oracle passwords were to be used across the organisation as this represented a significant security issue. iQSonar was able to quickly discover that non-compliant passwords were in use on 12% of Oracle instances.
iQSonar is the only third party tool verified by Oracle as providing accurate and definitive Oracle deployment and usage data

By Patrick Gunn
Recent research findings from FAST in the UK revealed that one software supplier audited 50% more businesses in 2009 than in the previous year. I believe this to be a reaction to the difficult economic times. Most software vendors have intensified their efforts to ensure software license compliance as a means to preserve their revenue during the downturn.
The larger the software publisher, the higher the risk of a software license audit. In fact, the result of an audit can potentially be one of the largest unbudgeted expenses for an enterprise. Unless organisations have their own optimised software asset management solution, they are pretty much at the mercy of software vendors when the auditors come knocking.
An Adobe software audit at a multi-national company is a case in point. This company was able to eliminate a large seat-count Adobe license liability worth over $3.8 million by using a next generation software asset management tool to accurately recognise installed software. The company proved to the Adobe auditors that it actually had a free Flash Player installed as opposed to the several hundred dollar Flash Professional.
When defending against an Adobe audit, pay special attention to the following:
• Inventory and asset recognition:
Collect and analyse inventory for all computers to accurately list all the installed Adobe products. You should include all versions and editions of the different products too. For example, if you have three versions of Adobe Acrobat installed, then the inventory analysis must accurately report all of these versions.
In addition, you must be able to accurately determine the versions and editions of Adobe suites installed versus the component products. This can have significant cost implications for you – Adobe suites cost less than the individual components. Not recognising the Adobe suites can therefore affect your software license liability.
• License management:
The common Adobe volume license agreement is Cumulative Licensing Program (CLP). The product use rights (PURs) for each Adobe product purchased under CLP can differ, from product to product and version to version. For example, Acrobat 6.0, 7.0 and 8.0 may all be installed on the same computer and it will only consume one license. However, this is not the case for the older versions of Acrobat, where each installation consumes a license. Hence, the importance of accurately reckoning installations and applying use rights correctly.
With an enterprise license optimisation program in place, your organisation will be ready the next time the auditors come knocking.

By: Natalie Lias

When an organisation commits to a software solution and begins the formal purchase process, often the IT architecture and infrastructure specialists who have been critical to evaluating and specifying the solution are not included in the process. The effort IT specialists have put into creating business requirements and ensuring the software’s capability to deliver is considered concluded, and the final purchase process is turned over to procurement in conjunction with the legal department. Unfortunately, “throwing it over the wall,” while typical in many organisations, is a disaster waiting to happen when considering complex software purchases.
The procurement and legal teams are typically experts in negotiation, indemnity, intellectual property, and other issues which are common across strategic purchases for your enterprise. These skills are critical and necessary for the successful culmination of a software license purchase, but they are not sufficient! Although there are exceptions, for the most part, dedicated procurement staff lack detailed knowledge of IT and software requirements.
This lack of expertise can have disastrous results when the specific terms and conditions of a contract are being negotiated. Because typically procurement staffs are evaluated internally on the level of discounts they achieve, they may accept licensing limitations from the software vendor that seem harmless but can seriously undermine the architecture and functionality required by the IT technical personnel who originally created the purchase requirements!
For example, a purchasing professional, in the course of negotiation, may accept limited use rights for a particular license order. While this might be acceptable to the IT business owner, who is purchasing the licenses for a specific purpose, often lower-level IT staff are not made aware of these limitations. Instead, they are simply told that “new licenses are available,” so the restrictions and limitations get lost in translation. This can be a costly mistake if the vendor later conducts an audit and finds restricted license types used for general purposes.
What’s the solution? Certainly not to have your database administrators involved in discussions with legal and procurement (a recommendation that would be sure to irritate all involved). Rather, the software purchase business owner needs to understand that software license rights that are being traded away to achieve a larger discount may hobble the enterprise’s flexibility to use licenses and may create a software compliance nightmare. Non-standard license terms are certainly one way to achieve larger discounts and greater software value, but these advantages need to be vetted by the IT staff who will be implementing the software to ensure that after all their hard work, they can still get their jobs done.

By Andy Ellwood: iQuate

iQuate has discovered discrepancies between accepted and actual Oracle deployment and usage information in every customer we have worked with, and our customers have used this accurate data to achieve greater levels of control in several key areas.

For example, a high profile UK government agency delivering public facing services outsourced its  IT operations to a large Systems Integrator. In order to ensure they were compliant, the SI employed a team of Oracle experts to perform a manual Oracle inventory count.

iQuate were engaged to verify the result of this audit using iQSonar. The tool was initially deployed in a test environment to satisfy the client that running the tool would have no detrimental impact on the performance or availability of key business critical applications.

Once deployed across the entire network, iQSonar discovered that the manual audit was incorrect. This discrepancy was caused by the SI having prepared a list of Options installed, rather than Options in use. Had this been reported to Oracle, the licence position would have been overstated to a list price value of £1.1m

In a separate example iQuate was engaged with a major international insurance services organisation. During the scanning process our team was told Oracle would not be discovered on Windows-based or Virtual servers because installation  of Oracle on Windows or Virtual environments were against company policy and the customer had strict processes and procedures in place that governed the installation of software.

Within the first day, iQSonar had discovered Oracle on Windows server and Virtualized Windows and Linux servers, despite management being assured only days previously that this was not the case.

iQSonar uncovered seven digit  licence savings for the customer, and also prompted a review of operational procedures that led to improved operational management and control.

iQSonar is the only third party tool verified by Oracle as providing accurate and definitive Oracle deployment and usage data.

By: Steve Mullins

The Virtualisation Boom
Datacenter server virtualisation saves space, power and hardware cost for thousands of enterprises by consolidating physical machines. The reduction in the number of physical machines is achieved by increasing hardware (CPU and memory) utilisation 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 virtualisation. The total savings due to virtualisation can be in the millions of dollars per year for large enterprises. This is why 60% to 80% of IT departments have server consolidation projects underway, according to analyst reports.
For more information, and to read the full report, please click here.

By Patrick Gunn

I was reading the results of a research study by the National Computing Centre (NCC; www.ncc.co.uk) in the UK, which highlights that 31% of IT departments are expecting to see their budgets reduced this year. Of these, 33% are delaying software refreshes. The NCC’s Evaluation Centre interviewed more than 100 companies for the survey, ranging from those in the public sector to IT and Telecoms, and companies of all sizes ranging from those with £5 million turnover to more than £5 billion.

It is often overlooked, but enterprises can reduce their overall IT costs by 5% – 10% annually, by implementing a next generation software asset management (SAM) program that delivers enterprise license optimisation. The released budget could then potentially go towards other business critical IT projects underway.

At a recent meeting, Clive Longbottom, Service Director, Business Process Analysis at Quocirca commented that, “Historically, keeping track of software license consumption has been a bit ‘hit and miss’, and is often not high up on either the IT or the business priorities of enterprises. This attitude will need to change to make software license management tools an essential part of enterprises’ technology mix – more so as we move toward an even more complex virtualised world. Next generation software asset management tools, commonly known as Enterprise License Optimisation, are required to manage the process and calculate true license consumption for real cost saving benefits.”

To derive the highest rate of return from investment in software asset management programs, enterprises need to take a comprehensive view of the process. Often times, organisations focus simply on counting software installations and manually comparing this to purchase counts. But this approach ignores several critical optimisations that can significantly reduce initial license purchase, true-up and renewal costs. For example, software vendors typically specify Product Use Rights that define license entitlements provided by the purchase agreement and/or product. By applying Product Use Rights, enterprises can reduce their software license consumption dramatically in many cases. Other optimisations include license reharvesting and maintenance cost reductions associated with unused licenses.

One of my northern European customers recently implemented optimised next generation software asset management program to overhaul its IT asset management processes across nine countries. This included over 8000 desktops and servers. Within the first year alone, the company identified software savings of $740,000.

More and more enterprises are beginning to reap the significant return on investment offered by next software asset management processes and technologies that deliver enterprise license optimisation.

By: Steve Schmidt
In a recent report from Gartner on IT Asset Management (ITAM) solutions (http://www.gartner.com/technology/media-products/reprints/ca/173370.html ), Flexera Software is referenced as a company that solves the specific problem of software license entitlement management for expensive applications. That’s an appropriate description. It applied when the report was written before the acquisition of ManageSoft, and to an even great degree now.
That reference in the report raises an interesting question regarding the difference between traditional ITAM and Enterprise License Optimisation. They are linked, but they are not the same. Traditional ITAM forms the foundation of Enterprise License Optimisation. Information about what is installed and what is licensed is critical, but what it also needed is 1) information about how the application is used and what the specific entitlement rights are, as well as the 2) analysis to tie that information together in a way that enables an optimised license position.
Where Enterprise License Optimisation complements the ITAM category is in making intelligent business decisions about the procurement and allocation of entitlements. It goes beyond counting installations, and even beyond harvesting and reallocation of unused licenses. It extends to leveraging upgrade and downgrade rights, applying the rights to use on a second system, and splitting of full suite rights among users of the different suite components. Other examples include assignment of the appropriate user-tier rights (and costs) based on actual usage type, and performing scenario analysis under different license reallocation conditions.
Why is this “specific problem” of software license entitlement management so important? Because applications have become strategic. More money than ever before is spent on them, they are taking the place of pure hardware devices, and they run the business. They are the key set of IT assets, and yet they are generally not “owned” by the users. Thinking of applications as an asset to be managed is important, but is not enough. In addition, the associated software licenses and entitlements need to be optimised.

By: Jeff Jones
We have discussed software licensing on virtual machines from an ISV perspective in several postings on Enterprise License Optimisation blog; in this post I’d like to address the same issue from a software consumer’s perspective. It is important that software asset managers understand and manage to these unique vendor-specific license metrics since software vendors are providing so many different ways to potentially license software within a virtual world.
One of the biggest challenges Enterprises face, is the basic premise of matching the installed and used software asset to the virtual machine it is running on, and then mapping these virtual machines back to the physical hosts they reside on.  For example, you may have multiple virtual machines running one of more of the same software assets, on the same physical host.  How is that scenario licensed by that particular software vendor?  Unfortunately, it is probably different for every software producer.  
Let’s take database software as an example.  Let’s say a customer is running both Oracle Database EE and Microsoft SQL Server in Virtual Environments (which is very common in today’s enterprise-class data centers). For Oracle, let’s take an example of running Oracle DB’s within a VMWare ESX environment.  First, you need to license all of the physical processors on the virtual machine host if Oracle DB EE is running on any of the virtual images on that server.  You also need to use the Oracle definition of a “CPU” (Physical Processors * # of Cores * Core Factor).  You then need to introspect each DB instance running in any virtual machine on that virtual host as well, because you need to understand which Database Options are running as well.  These Database Options need to be licensed at the host level, even if each Database Option is only running on a subset of the database instances (and thus virtual images) on the physical host.  If you have to do this process manually, it can get very complicated very quickly, and if you frequently move VMWare images between hosts, it further complicates the tracking required.
Next, for SQL Server, licensing becomes even more complicated and difficult to track.  First, you need to determine which edition of SQL Server you are running, because the licensing rules in a virtualised environment differ between editions like Workgroup, Enterprise, and Datacenter.  You also need to examine if you are licensed by a Server/CAL model, or by Processor.  And when licensing by processor in a virtual environment for SQL Server, if you are not licensing all the physical processors on the host, you also need to understand the number of Cores per physical processor much like you do for Oracle (although the math is different).  And of course, Microsoft has changed the licensing rules over time for virtual environments, so it is important to understand when you licensed SQL Server, under which rules, and apply these entitlements and terms and conditions to the right SQL Server licenses within your Virtual Environment.
Needless to say, the challenges abound for measuring and tracking software assets within a Virtual World.  On a positive note, we have come a long way helping customers track software assets back to specific virtual machines, and back to the original virtual hosts.  We can then map these assets back to the entitlements and terms and conditions on a vendor-by-vendor basis.  We are seeing more customers automating this process, which is improving both their speed and accuracy of software asset tracking in a Virtual World.

By: Cyndi Tackett

In my last blog post (Why Companies Over-buy Desktop Application Licenses), I explored the common organisational traits that trigger software license overspend.  The truth is that for ANY license, the company is either over-buying or under-buying the license.  Without the capability to produce automated software license position reports, it is extremely uncommon for purchased to equal consumed licenses.  The result of this is either over-buying or under-buying for every single title in the software estate. 
Under-buying of software licenses is particularly harmful because it can result in large unbudgeted true-ups, a damaged image/brand, reduced negotiating position, and strained relationships with strategic vendors.  In this post, I will explore the common characteristics of companies that under-buy software licenses.   
First, license models and software license agreements are complex making it exceedingly difficult for employees to insure software license compliance on a day-to-day basis.  Most organisations have pervasive misconceptions of how to apply license use rights.  Common misconceptions include: “we have an enterprise license agreement so we can install any software from this publisher” (very rarely true), or “we can use this software on any platform as long as we have a license” (seldom true), or “we can freely upgrade to the latest version under our agreement” (sometimes true), etc.  If proper software asset management is not a practiced discipline across the corporation, the company is at risk. 
Second, a lack of processes and controls (particularly in the desktop estate) enable unlicensed software to be installed in the organisation.  Proactive software license management provides visibility into the license position before deploying new software.  Companies often assume they have the licenses to cover the installs or view licensing as an after-thought – making it difficult to monitor compliance on an ongoing basis.  Without a repeatable process to reconcile licenses and stay in continuous compliance the company is in a vulnerable position. 
Third, is a lack of visibility into what is actually installed in the environment.  Without the ability to automatically translate raw inventory data into licensable information, the process of determining what is actually installed is manually-intensive, time consuming, non-repeatable, and error-prone.   Companies who make educated guesses about their licensing needs often underestimate what is installed in the estate.  Even companies who make an effort to monitor licenses for their top vendors are at risk for the rest of the software portfolio.  The old saying “it is the bullet that you don’t see coming that kills you” proves to ring true time and time again in respectable companies that do not have a comprehensive Enterprise License Optimisation, or next generation SAM, solution.  Automatically reconciling the entire installed software base is the only way to mitigate risk of under-purchased or pirated software within the organisation. 
Understanding the actual license position across all vendors is critical to the procurement decision making process.  Even if under-buying is found in the software portfolio, organisations can negotiate an advantageous transaction on their terms and avoid paying list price for true-ups.   A proactive next generation SAM solution puts companies in the driver’s seat.

By: Randy Littleson, Flexera Software

The enterprise has awoken to realise that applications are one of the least well managed of all strategic corporate assets. Corporate procurement is bringing the lessons learned from strategic solutions such as Supply Chain and Spend Management to the world of software. Procurement is no longer just the final tactical step before a contract gets signed. Increasingly, procurement is actively driving more and more of the business dimension of the software asset lifecycle. Procurement focus is moving beyond a narrow focus on software price discounts to a broader strategy of optimising enterprise-wide usage.

The bedrock of effective strategic procurement is information. IT and Procurement executives at the leading enterprises are seeking a standard solution to acquire and deliver comprehensive, rich information needed to optimise software assets. Such solutions can save hundreds of thousands or millions of dollars in unneeded application usage costs, often freeing up those funds for other needed software solutions.

Many large organisations have existing IT Asset Management (ITAM) software solutions. The first inclination may be that such a solution can help strategically manage application usage and optimise software license spend. But these solutions deploy and inventory software assets, whereas today the business imperative is transforming from counting what you have to controlling, using and optimising the software licenses you have while ensuring that you only buy what you need.

As you look a bit deeper, you see that IT Asset Management solutions differ from Enterprise License Optimisation solutions in material ways:

                                                    IT Asset Management                           Enterprise License Optimisation
Answer the question:        What is deployed?                                           How are software licenses being used?

Business purpose:               SOX, compliance, security                          Use what you have, buy what you need
                                                    (grant/revoke system access rights)

Techniques:                           Sniffing target .exe files technology         Business context is core, technology is
                                                    approach to measurement with                the enabler
                                                    mininal business or commercial
                                                    context

Choosing the right solution is dependent on understanding your true business purpose. Increasingly, we’re finding that the market is demanding capabilities to control the use of and maximise the value of software licenses. Whereas IT Asset Management (ITAM) solutions have proven adept at solving the problems they were designed for, they were not designed for this purpose and organisations should be seeking solutions designed to complement their ITAM solutions to meet these new challenges.