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The impact of hardware on your licensing costs

One of the biggest challenges when it comes to managing and applying software licenses is that there are many variations available, depending on the solution businesses opt for. License rules also change regularly as vendors adapt to new technology, phase out old technology or update their solutions. Businesses can find it hard to keep pace with license changes and renewals, Software Asset Management (SAM) can assist to ease the burden.
Matthew Poulter, SAM Business Manager at First Technology National
The IT hardware that organisations choose can have a significant impact on the cost of software licenses. If a company does not understand the impact of their IT hardware specification decisions in relation to software licensing, they may find themselves spending more on licensing than anticipated. Moreover, the licensing rules that rely on hardware configurations may change, making it difficult for companies to keep up to date with changes in ‘use rights’ or licensing rules.

SAM enables businesses to understand licensing requirements so that they are prepared when it comes to establishing the need for hardware specification or solution designs.

License evolution


Computer technology has advanced in leaps and bounds over the last few decades and that has had a substantial impact on how software vendors measure the use of their software. Licensing has accordingly evolved over the years, especially with the advent of cloud technology and the escalation in demand for capacity, performance and compute power.

The way licenses are assigned has changed as computer performance has increased. For instance, in the past, you purchased a license for each server; then as hardware vendors moved to include more processors into each server, so processor licensing was introduced. Today, many new servers have exceptionally powerful processors, and licensing can be applied to Cores, Threads or may even be specific to a particular type of processor.

As complexity is added and technology moves forward, it can often become exceptionally expensive to license an ageing infrastructure with modern licenses.

Ultimately, the business can end up spending more on licensing than is warranted, especially if their compute power requirements are over catered for.

Planning your hardware


Often, when businesses select their hardware, they fail to consider the software requirements for that hardware. This is usually because the hardware is chosen by an IT team who may not have licensing backgrounds, therefore don’t incorporate the impact of licensing when specifying a solution.

Then, there is the fact that hardware is predictable – businesses know what they are getting when they buy a tangible piece of hardware. Licensing is more abstract and, as previously mentioned, can be ever-changing. Because of its intangible nature, it can be easy to miss the licensing aspect.

It is advisable for hardware architects to have a software licensing expert on hand when they are investing in hardware. It’s easy to over-specify a solution, considering factors such as potential growth and catering for future requirements. Architects may opt to invest in high powered machines with extensive compute power which may not be necessary at that point in time.

Businesses should rather ensure that when they plan solutions that they understand how to apply licensing scenarios to give you the best functionality and performance considering the cost for the entire solution.

Know what you have


Businesses may already have invested in hardware and software licenses and may be unsure of what licenses they have, whether or not they are in use and how to scale back. There may also be uncertainty about when to upgrade to newer versions or higher editions to best compliment the latest hardware solutions available.

In such cases – and with planning new architectures – it makes sense to engage the services of a SAM specialist.

SAM brings the hardware and software components together, ensuring they are aligned and that both the software and hardware are in line with the business requirements. For existing solutions, SAM can provide insight into what licenses are being used and where to eliminate unnecessary expenditure – or add licenses where there may not be any. For new solutions, incorporating SAM can ensure that budgets are maintained, and the overspending does not occur.
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About the author

Matthew Poulter, SAM Business Manager at First Technology National
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