Pica Communications Licensing Note

Upgrade Paths for Virtualization

Other Licensing Notes in this series:

Software Assurance and Virtualization Basics

Nov. 22, 2010

By Paul DeGroot
Principal Consultant
Pica Communications

This article represents the opinion of the author and is not endorsed by Microsoft.

Windows 7 and Virtualization

Customers have a variety of reasons for upgrading to Windows 7, and while virtualization per se may not drive that decision, two major priorities predispose some customers to link Windows 7 upgrades to virtualization.

1. Virtual desktop infrastructure (VDI) replaces a desktop-resident OS with bits that are sent over the network to the local workstation or that run on a central server and are accesssed by users over the network. The goal is to replacing hundreds or thousands of user-administered (and often screwed-up) desktop computing environments with pristine, centrally managed desktops that can provide a more reliable and secure computing environment.

2. Given that Windows XP is still the dominant business OS, many organizations depend on applications that have never been updated to run on Vista or Windows 7. As long as they keep running XP, they don't have to update them. However, XP is within a few years of losing all support from Microsoft, including security updates, so this idyllic picture is rapidly fading, and many organizations need to upgrade their hardware. Virtualization provides a transitional crutch, letting XP diehards move to the next generation of hardware and software without having to totally abandon critical apps, such as IE6, that won't run on post-XP OSs.

This note focuses primarily on the second requirement and does not covering issues such as remote boot, although some of the upgrade paths discussed here may be relevant to those scenarios. It also includes some tactical advice about matching your requirements to specific buying patterns that can keep costs down while still providing the licenses you need to meet your virtualization needs.

If you're not familiar with Software Assurance, which plays a major role here, and the virtualization rights that it delivers, read Software Assurance and Virtualization Basics first.

Buying SA for Virtualization

Since almost all virtualization rights are now safely tucked away inside Software Assurance (SA), buying SA will be the primary focus for customers who want to virtualize IE6 in some way.

SA can be purchased as part of a company-wide licensing solution or on an ad hoc basis. Many companies may already be licensed for SA and have existing IE6 virtualization rights.

Company-Wide Solutions

Microsoft customers with Enterprise, Enterprise Subscription, Open Value Company-Wide, and Open Value Subscription Agreements, have licensed the latest version of the Windows OS for every desktop or portable they own through these agreements, which also automatically add SA rights to any subscribed or purchased licenses.

These customers can virtualize IE6 to their hearts' content in a full virtual machine (e.g., using the free Windows Virtual PC) at no extra cost or with other virtualization solutions they purchase, such as those included in the Desktop Optimization Pack or obtained from other vendors. They can also assign up to four OS instances for use with Microsoft Enterprise Desktop Virtualization (MED-V) or a third-party virtualization product. (Note that they can create more than four instances, but can not run or access more than four at once on a licensed desktop.)

Ad Hoc Purchases

SA can be added to volume licenses at the time a volume license OS upgrade is purchased. It can also be added to OEM and retail OS licenses within 90 days of the purchase of those licenses.

The programs used most often for this are Open License NL, Open Value (non-companywide), Select, and Select Plus.

A good strategy, for those who have standardized on Windows XP, is to purchase new computers with Windows 7 Professional and add SA to the new computer within 90 days (if they find that XP Mode is not an adequate virtualization solution). That lets them migrate users from an older Windows XP desktop to a new Windows 7 desktop, while moving their Windows XP–dependent applications from a physical XP operating system environment (OSE) to a virtual XP OSE running on Windows 7. It also lets them use more sophisticated virtual machine management tools (purchasing MED-V, App-V, or third-party virtualization management software) to centrally manage and provision virtual machine images.

Adding SA to an existing computer outside of the 90-day window, such as to existing computers licensed only for Windows XP, is quite costly. Because SA must be purchased at the time a license is purchased, these customers must first purchase an OS upgrade (for as much as $187) and then add SA to it, for a cost ranging from about $40 to $54 a year for the remaining term of their volume licensing agreement (after which SA can be renewed, if they want to continue to have SA rights such as virtual OS licensing). Thus, a customer who purchases SA through the simplest volume licensing program, the two-year Open License agreement, will spend $187 for the license and $108 for two years of SA (at $54 a year), for a total of $295.

When adding SA to existing computers, keep an eye on the calendar, since SA has a fixed term. Your virtualization rights last only as long as your agreement does, and in some cases, you'll pay for SA coverage you'll never get.

Here are examples:

Open License NL has a two year term and all purchases, including SA subscriptions, are paid in full immediately. Even customers with just one year left in an Open License agreement will pay for two years of SA, even though they will get only one year of coverage. The workaround is to start a new Open License agreement, which requires the purchase of just five licenses of any kind. Customers should pool a few of their purchases to start a new Open agreement, and they will then get the full two years you pay for.

Select License Agreements run for three years, and if customers purchase a license and add SA to it at any time after their initial purchase, they must purchase SA for the full current year and any remaining years in the agreement. Worst case scenario: an organization purchases a new computer and adds SA at a time when 13 months remaining in their Select Agreement. The organization will pay for 24 months of SA but get only 13. No completely satisfactory workaround exists for this, but customers with 13-15 months left in an agreement can delay the purchase of SA until it falls into the next year of their agreement, at the end of the 90-day window. One drawback is that the customer will be unable to use any SA rights, such as virtualization, until they have actually purchased SA for the device. Other workarounds: purchase SA through Select Plus, which always offers threeyears of SA; purchase two years of SA in a new Open License agreement. When the two years are up, customers who still need virtualization rights can renew the SA in Open for another two years or in Select Plus for 25-36 months.

Thinking Strategically

Virtualizing the desktop OS specifically to handle legacy software (as contrasted with other virtualization goals, such as centralized desktop management) should be considered a transitional, rather than a long-term solution. How long and how extensively a customer plans to use IE6 applications affects the choice of purchasing path they follow.

How Long?

All customers are advised to have some kind of plan to rewrite, upgrade, eliminate, or replace IE6 applications before Apr. 2014, after which Windows XP will no longer be supported.

If XP Mode does not satisfy their operational or desktop management requirements, they should purchase SA at least for new computers that replace existing Windows XP devices.

If they can retire their IE6 application within two years, purchasing SA on new computers through Open License within 90 days will be the least expensive option, since this approach does not require purchase of an additional OS license and the agreement requires payment of SA for only two years.

If they are looking at a three-year time horizon, programs like Open Value, Open Value Subscription, or an Enterprise Agreement Subscription may provide the required SA and virtualization rights at lower cost. A reseller can provide customers with exact quotes for their situation.

For example, an organization that planned to tackle multiple legacy IE6 applications over the next three years could identify the communities of users for each application.

Applications that will be remediated earliest may need only a short period of SA coverage, so those users could be upgraded to Windows 7 first, such as with the purchase of a new workstation. By adding SA to their OEM licenses through a new Open agreement or an existing Select agreement, they will be able to use virtualization technologies for the one to two years that remediation of their incompatible applications will take. (Customers who have a Select agreement with only one year remaining will get the lowest price of all, as low as $40 for SA coverage for one year, which may match some IE6 remediation time frames.)

Users of applications incompatible with Windows 7 that will be hardest to remediate can be kept on Windows XP longer, then upgraded to new computers with Windows 7 to which two or three years of SA have been added. This will stretch the time frame for remediating their XP applications out until as far as 2016, assuming that they get a new computer in 2013 and add three years of SA.

How Much?

In many organizations, specific IE6 applications may be used by only a subset of employees. Furthermore, as an organization tackles legacy IE6 application retirement over time, some users will no longer need the virtualization crutch.

These customers will find it better to use programs such as Open License, Open Value (but not Open Value Company-Wide), Select or Select Plus, since these programs do not require licensing every computer in the organization for Windows 7 and SA. By targeting SA purchases only to users who need to use solutions that are more sophisticated or manageable than XP Mode, organizations can minimize costs.