Citrix's announcement that XenDesktop 4 licensing will break from the concurrent user model in favor of licensing by named user has got many people up in arms,and making loud claims as to how this will force them to abandon plans to adopt VDI. However once you get past the shock of the new and start to look at things more coolly it soon becomes clear that while it might have be possible for Citrix to retain a concurrent licensing model a little while longer, the direction that the VDI market is heading in will force every vendor to move away from the concurrent licensing model in the near future.
I was going to write about VDI licensing from the customer perspective, but the Burton Group's Chris Wolf beat me to the punch on his blog (see side bar for link)
Reworking licensing to be user-centric needs to be a top priority among client application vendors heading into 2010. Vendors that insist on binding licenses to physical devices in an increasingly virtualized world are not part of the solution. They’re part of the problem.
Chris Wolf
so I'm going to take a look at this from the vendor perspective.
Even today XenApp 5.0 no longer operates with an exclusively concurrent licensing model. The introduction of support for off-line streaming apps requires a hybrid licensing model where hosted apps are served from a pool of licenses assigned concurrently, but streamed apps use license leasing. This is necessary because streamed apps can be configured to continue to operate when disconnected from the host network, and at that point it is no longer possible for the License Server to determine if an application is being accessed used or not. The only viable solution to this problem is to adopt a leasing model. Allocating licenses to the user for a fixed duration with the option to renew for as long as the streamed application is being used. This by the way does more than ensure that Citrix maximizes its licensing revenue. By preventing a license from be reallocated until its lease expires it prevents licenses from being double booked and so ensures that a customer can meet any audit with confidence. I can think of a few companies than have been subject to audit and found themselves on the wrong side of a multi-million dollar settlement who might wish that other vendors would offer that approach.
Looking forward beyond the launch of XenDesktop 4 to the day when XenClient is launched, the technical landscape becomes much more complex. One user might be running a VDI desktop hosted within the data center, another might be a task worker running a single hosted application. Others might be working from their homes running a VDI guest on a XenClient on an otherwise unmanaged workstation but with a VPN connection to the corporate network, while someone else is running another VDI guest on a laptop also running XenClient fully disconnected from any internet connection. You can no longer control licensing based on connection count if your product does not require a connection to work. This change applies not just to Citrix, but to every VDI software vendor that intends to compete across the full gamut of VDI technology platforms.
If concurrent licensing is no longer an option that leaves per machine or per user. In most environments, there isn't much difference between these two models. In most cases the number of people sharing PC is very low, so a PC based model could work just as well as a per user model, and this is where it gets interesting. If you go back to Citrix and ask why they adopted the concurrent licensing model, you might if you were lucky find someone who has been around long enough to be able to remember the initial reasoning behind that decision which if I remember correctly went something like 'We license our technology based on usage. You are only using ICA when you have an active connection between PC and server, so we think it is only right that you only consume a license when you have an active connection to the server.' Now the intellectual property that you use is far more than just the presentation protocol and much of that intellectual property is still being used even when the connection is not. But the focus is still on the user of the technology rather than on the machine that it is consumed from. Furthermore, with the continual increase in diversity of access platform many of which might be used in a single working day, leasing to a device would lead to multiple licenses being consumed by a single user in the course of a day and/or licenses being orphaned as a user accesses stateless devices that are re-provisioned from a gold image every time they are used. So by default licensing based on who is using able to use XenDesktop is the only choice left open.
Unfortunately there is never a good time to move to a new licensing model, Citrix could have forced through the change with XenApp a couple of years ago with the introduction of off-line access to streamed applications, but rightly, in my opinion, chose not to. Leaving the change until VDI is more mature would create even more anguish than it has done today. So now, as the VDI paradigm starts to gather speed, is probably the least bad time to make this change.
What matters most at this point is that the transition to this new licensing model be handled with appropriate care and respect for the current customer base. Citrix's opening offer is very attractive to existing customers once you look at the detail and compare upgrade costs with the cost of Subscription Advantage to maintain a XenApp subscription, especially when you take into account that if you time the upgrade right you will finish up with both the XenDesktop 4 upgrade and the XenApp 6 (Parra) release within the same 12 month period. The 2 for 1 offer works very well for most existing XenApp customers but not all. Citrix need to look at how it can address market segments such as retail, education and healthcare where the user to device ratio is frequently much higher.
My final concern is that Citrix ensure that an appropriate balance is achieved between the cost of Subscription Advantage going forwards and the value delivered when customers find themselves owning a far larger number of licenses than they might previously have had.
