AUTOMATING APPLICATION INFRASTRUCTURE

Software Licensing in the Cloud

Stuart CharltonChief Software Architect, Elastra

Objectives

• Put simply, given Cloud Computing, is there still room for a software product industry?

• Where are the problems with today’s licensing regime?

• What opportunities arise with cloud computing to improve the licensing situation?

• How could we resolve technical barriers to software licensing in the cloud?

2

TIMELINE

COSTLY

AGILE

ClientServer

J2EE ServiceOriented

Virtual Cloud

J2EE» Silos of

Function» Redundancy» Sprawl

Service Oriented» Reuse Processes» Composable Units» Decouple

Components

Virtualization» Pool Infrastructure» Optimize Resources» Decouple the

Physical

Cloud Computing» Virtualized Software

Layer» Automated Provisioning» Elastic Infrastructure» Virtual Data Centers» Pay Per Usage» Governance Models

3

Waves of IT Evolution

New Powers of Governance

Groups & Chargebacks

Web

Lo

gic

Co

mp

ute

Un

its

So

ftw

are

Un

its

Groups & License Use Apps & Quotas Utilizations &SLAs

Which Apps Used Which Resources?

Metering and Chargeback

Graphic View of Data Center

Design & Use

Trends of Consumption

DetermineQuotas for Apps

or Groups

Allocate Resources by Price &

Capabilities

Prioritize Resource Costs to Business

Priorities

Restrict Excessive Consumption

Accounting Dashboards Specify PolicyEncourage

Efficient Use

Ora

cle

DB

4

The Cloud Provider Continuum

Closer to theDeveloper/User

Closer to theSysAdmin/Ops

Platform-as-a-Service Infrastructure-as-a-Service

“Supplier Ecosystem”“Retail Ecosystem”

5

“On Demand” Strains Traditional Licensing

• Growing numbers of infrastructure & services» Give people “on demand” freedom, they’ll use it!

• A wide variety of licensing models» Customized licenses are common with enterprises

• Rigid license enforcement policies» E.g. tied to a single IP address / machine

• Services of all shapes and sizes» From low-level infrastructure to full software systems

• Consolidation of enterprise software vendors» “Wait and see” approach with cloud computing

6

Package & Payment Models

Spectrum:• As a Service

» Low footprint» Revocable

• As a Product» Higher footprint» Perpetual

7

Pricing Models

• Traditional models still dominate» E.g. Oracle’s pricing on Amazon EC2

• A trending shift to perceived-value pricing

8

Information Asymmetry

• Enterprise software is largely a “market for lemons”

• Seller knows more than thebuyer

• Increased popularity of:» Proof-of-Concepts» Detailed RFPs» Open Source» On demand access

9

Enterprise Licensing & Maintenance

• 21% Annual Maintenance Fees• The “Wrap and Roll”

» Vendor wants to make its quarterly performance

» Company wants to reduce itsspend

» “Let’s discount maintenance for 2 years”

» … and do it over again

10

The Enterprise Acquisition Process

• RFP-led or Strategic Sourcing• Lots of Front Loaded Risk-Mitigation• Purchase for peak demand up-front

» Large capital outlays

11

Popular and Growing Alternatives

• “Adoption-Led Acquisition”» Try and buy

Pay after a period» Open source

Pay for support and/or complements like indemnity

• “Agile Acquisition”» Co-develop the requirements and architecture» Growing with large-scale acquisition (e.g. government)

12

Acquiring Software in the Cloud

• Supports a wider variety of adoption-led scenarios» E.g. On-demand doesn’t need to be open source

• Reduced capital and lead times for agile acquisition

13

Tech Challenges to a On-Demand Licensing

• License description» There are a wide variety of forms & sizes» Customization is common and expected with enterprises

• License enforcement & auditing» How one be sure license are enforced?» …or at least audited?» Especially with fewer human barriers to access

14

A Sketch of a Solution

• Hyperlinked Cloud Modeling» Describing Software, Architecture, and Infrastructure» … Along with Entitlements!

• Cloud Entitlement Modeling» Participating Roles» Digital Identity and Authorization» A Cloud Entitlement Reference Architecture» An Entitlements Language

15

Hyperlinked Cloud Markup Languages

DEFINE

EXTEND

MARKUP

ECML

EDML

EMML

ELML

CONCEPTIMPLEMENTATION

Modular, layered, open-world, “connective tissue” for automated applications

16

Cloud Modeling Bridges Collaboration Gaps

Private & Public Cloud Resources

APPLICATION ARCHITECTS

SYSTEM ADMINS

IT MANAGEMENT

DEV/QA TEAMS

ENTERPRISE ARCHITECTS

IT OPERATIONS

Test System Staging System Production System

ENTERPRISE CLOUD

Deploy & Configure Systems

Auditing, Metering, and Planning

Change & Configuration Management

Code, Resources, & Builds

Standard Designs

Policy-Based Architectural Designs

Automated Planning, Provision & Configuration

End-to-EndCollaborativeIT Service Model

17

Cloud Entitlements – Participating Roles

18

Digital Identity and AuthorizationEssential Building Blocks for Interoperable Entitlements

(Kerberos) (PKI)

19

Digital Identity and AuthorizationPossible Approaches or Standards

• SAML v2.0 » Web Services and Web Browsers

• WS-Federation and WS-Trust» Primarily for Microsoft Windows and Azure

• OAuth» RESTful delegated authentication, growing at IETF

• FOAF+SSL» Emerging Semantic Web approach to identity

• Mutual SSL Authentication» Basic scenario, long history, relies on PKI trust

20

A Cloud Entitlements Reference Architecture

21

Entitlements Modeling

• A uniform Rights & Duties foundation is possible» E.g. Open Digital Rights

Language

• Beware Patents» (includes standards

like XACML!)

• Cloud could use targeted, minimal, extensions for payment & accounting

ODRL v2 Core Model

22

A Minimal Licensing Entitlements Language

• Example Rights:» Provision» Scale» Quota

• Example Duties:» Usage Audit» Subscription fee

23

Summary

• Traditional Software Licensing is Under Strain» On Demand Models change prevailing assumptions

of what is static

• A full shift to “As a Service” models is not likely

• But the enterprise software industry must adapt» Change business practices

and/or» Adopt enhanced technology to resolve license complexity

24

AUTOMATING APPLICATION INFRASTRUCTURE

Thank You

Stuart Charltonstuartc@elastra.com