As a start don’t let the title fool you this is not related only to Microsoft virtualization, but to every virtualization platform out there. Don’t let vendors mislead you as the saving can be higher on Microsoft Licenses with non Microsoft Hyper-visor like VMware where you can put more virtual machines on the same hardware box. Ok, so clearing the confusion out of the way read below to find out what I am talking about.

Being on the consulting role, I get to meet customers everyday on all levels (Administrators, Managers, CEOs,  Directors, Business). When they ask our advice on consolidating their enviornment & I bring the idea of virtualization one question I get hammared with every time ” How would paying for virtualization licensing is going to save us money?”.  Below are some of our & yours traditional answers & how a stubrn customer will reply to it:

– You will Save Space (I have a large DataCenter & Space does not matter to me at the moment)

– You will save on Hardware ( I can buy non branded cheaper 1u servers for the price of the licenses)

– You will Save on Power (My department is not billed for Power, or power is so cheap in here … ah remember I am working in the gulf region at the moment where electricity is very cheap.)

– Its not just about saving, but you get a lot of extra protection & availability (I am Ok with my current availability).

Hmmm, lovely customer huh!! what to do go home with no sale? Is it really virtualization not worth it to this customer? I mean each of the above four reasons are a huge benefit of virtualization, but not in our case here. The lovely next question to ask that stubrn manager would be: ” Do you use Microsoft products?”. Ah what I have discovered the answer of most of these stubrn customers will be “YES!!!”. Next question will be “If I can pay for my virtualization solution & still cut your Microsoft licenses cost by one fourth. Will you consider my solution?” Hmm, watch your customer mouth wide open & waiting for your advice. Well, as I am not a sales person but a techie consultant this is a fact and no leg pulling. Microsoft is allowing you to use many instances of their product when they are virtualized on the same server & only pay for one instance. Below are few examples of Microsoft products that you can save yourself or your customer money on by virtualizaiton.

Save Mony on Microsoft SQL Licensing with Virtualization:

Microsoft has changed their licensing to allow you to run as many virtual instances of Microsoft SQL 2005 or Microsoft SQL 2008 on the same server that you bought a license of the product for. So the more Microsoft SQL instance you need that can run on the same physical server the more money you can save. Below is the licensing statement for both SQL 2005 & SQL 2008 quoted directly from Microsoft:

For SQL 2005 Licensing in a Virtualized enviornment:

(Source: http://www.microsoft.com/sqlserver/2005/en/us/Special-Considerations.aspx)

When SQL Server 2005 runs inside a virtual operating environment, it requires at least one license per virtual operating environment. Several copies or instances of SQL Server 2005 can run inside a virtual operating environment. These must be licensed as follows:

• When Licensed per Server/Client Access License. Workgroup, Standard, and Enterprise editions of SQL Server 2005 now allow for unlimited instances within each virtual or physical operating environment. Previously, only the Enterprise Edition of the Server license allowed multi-instancing. This is a great incentive for customers to adopt the Server/Client Access License (CAL) model. For Workgroup and Standard, each virtual or physical operating environment containing a running instance of SQL Server requires a Server license. For Enterprise Edition, each physical operating environment containing a running instance of SQL Server requires a Server license and no separate licenses are needed for SQL Server instances running in virtual operating environments on the same machine.
• When Licensed per Processor. Workgroup, Standard, and Enterprise editions of SQL Server 2005 allow for unlimited instances in each virtual or physical operating environment. For Workgroup, Standard and Enterprise Edition, each virtual operating environment running SQL Server 2005 must have a processor license for each processor that the virtual machine accesses. If a copy of SQL Server is running on a physical operating environment, processor licenses are required for all of the processors on that physical server. For Enterprise Edition there is an added option: if all processors in a machine have been licensed, then the customer may run unlimited instances of SQL server 2005 on an unlimited number of virtual operating environments on that same machine.

For SQL 2008 Licensing in a Virtualized enviornment:

(Source:  SQL Server 2008 Licensing Overview)

When SQL Server 2008 runs inside a virtual operating environment, it requires at least one license per virtual operating environment, except for SQL Server Enterprise edition. Several copies or instances of SQL Server 2008 can run inside a virtual operating environment. These must be licensed as follows:

When licensed Server / CAL

Workgroup and Standard editions now allow you to run any number of instances of the server software in one physical or virtual operating system environment on the licensed server at a time. Previously, only the Enterprise edition of the Server license allowed multi-instancing. This is a great incentive for customers to adopt the Server/CAL model.

For Enterprise edition, for each server to which you assign a software license, you may run, at any one time, any number of instances of the server software in one physical and any number of virtual operating system environments on that server.

When licensed Per Processor

With Workgroup, Web, and Standard editions, for each server to which you have assigned the required number of per processor licenses, you may run, at any one time, any number of instances of the server software in physical and virtual operating system environments on the licensed server. However, the total number of physical and virtual processors used by those operating system environments cannot exceed the number of software licenses assigned to that server

Save Mony on Microsoft Windows Licensing with Virtualization:

On Windows 2008 Enterprise for each license you buy, you get to use it on 4 Virtual machines. That means you can cut your Windows licenses by 1/4. Furthermore, the datacenter edition allow you to use unlimited virtual  instances.

Below is the licensing statement for Microsoft Windows 2008 quoted directly from Microsoft:

For Windows 2008/2003 Licensing in a Virtualized environment:

(Source: Licensing Windows Server 2008 to Run with Virtualization)

The following outlines the maximum number of running instances in virtual OSEs each Windows Server 2008 edition permits:

*Windows Web Server 2008 permits you to run an instance in either one physical OSE or one virtual OSE, but not both at the same time without additional licenses. From a licensing perspective, you need a license for each instance running at the same time whether in a physical or virtual OSE.

Running prior versions or other editions

In place of the licensed version, you may run prior versions or lower editions in any of the OSEs of the licensed server. For example, if you have a server licensed for Windows Server 2008 Enterprise, you may run instances of Windows Server 2008 Standard or Windows Server 2003 R2 Enterprise Edition or Windows Server 2003 R2 Standard Edition in any of the allowed five instances on the server. As an extension of the above rights, you may also run prior versions of lower editions. You may not run more instances on the server than your licenses allow.

Summary:

The above was showing how to save only on two of the most spreaded Microsoft Products licenses by virtualization. They are not the only one you can save on, but I believe these two products alone can save big even after paying for the most expensive virtulization license. I hope that help you save while virtualizing your enviornment, or help you persuade that stubrn customer of yours.