The prevailing method of selling server software -- based of the number of processors, or basic computing brains, that a computer has -- is being made obsolete by changes in processor designs and server capabilities.
Chipmakers can now etch two-processor cores on to a single slice of silicon -- and these dual-core processors are about to become mainstream. The new chips are far more powerful than current models and can efficiently handle multiple tasks. But whether a dual-core chip should count as one, two or more processors when tallying software licensing charges is the crux of the issue. Other new chip technologies could further blur the lines.
Software makers recognise the problem but so far can't agree on a single solution. "People haven't woken up to the software licensing implications of a lot of technology trends in hardware," said Jonathan Eunice, an analyst at research and consulting firm Illuminata. "It's not just technology -- it affects business practices and buying patterns."
IBM began the drive to produce these dual-core chips in 2001 with its Power4-based servers. Sun Microsystems and Hewlett-Packard followed suit this year. But now, the definition of a processor will become more strained, as multicore versions of widely used x86 chips such as Intel's Xeon and Advanced Micro Devices' Opteron appear.
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"You shouldn't be penalised for the amount of cores you put on the chip."
-- Brad Anderson, Hewlett-Packard
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At its developer conference this week, chip giant Intel is expected to detail plans to bring its own multicore processors to servers and desktop PCs, starting with a dual-core server chips in the second half of next year. Rival AMD plans to release its own dual-core versions of its Operton server processor by the middle of next year.
Dual-core chips are just one problem straining definitional boundaries. Multicore chips with eight- and even 16-processor cores are under development at Sun and Intel. Another technology, called multithreading, makes a single-processor core look like at least two. And a single server can be divided into dozens of independent partitions, each with its own operating system and able to grow or shrink as computing loads change.
How multicore chips and other technological changes will ultimately affect licensing is still unclear, but industry executives and analysts say a simple, uniform system is unlikely in the short term.
Software licensing for these new technologies is not an abstract issue for buyers. "It is an extreme pain," said Gregg Siegfried, senior director of technology services at MedPlus, a maker of custom software for the health care industry. "From hyperthreaded Intel CPUs invalidating software licenses to virtualisation blurring the lines for traditional licenses, I have experienced numerous issues already. There is trouble brewing on that front."
Many software products, such as e-mail servers or databases, are often priced based on the number of server processors. With dual-core processors now on the market, software companies -- and their customers -- need to reconsider that model.
Some software makers charge customers as though a server with a dual-core processor were a two-processor machine, effectively doubling the cost of programs priced on a per-processor basis. Other industry players are urging software companies to treat multicore processors as a single unit, even though it could cut into software companies' revenues, if customers can make do with fewer instances of their programs.
Setting the agenda
Hoping to spur software makers to take action, chipmaker AMD on Tuesday released recommendations for how software companies should charge for dual-core processors in the x86 processor market. AMD urges software companies to count processors based on the number of physical sockets used, meaning that a dual-core chip would count as a single processor. AMD argues that this method is most compatible with many of today's practices.
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CPU pricing causes unnecessary complication when trying to put together a system. For example, I may have an 8 CPU server with plenty of capacity. 1 or 2 CPUs may be ample for my needs but because the software has CPU licensing I am forced to either buy a new server or cough up for the "potential" to use other CPUs that may never be realised.
The CPU licensing model is based on greed. The vendors are basically saying they want a cut of your productivity gains with the assumption that if you use 8 CPUs then you get 8x productivity gain over 1 CPU. That may be fine for the classic monolith apps like SAP that would often reside on their own server but now you get lots of smaller applications that share servers - but still try to operate on a per CPU basis.
What is needed is for the CIOs of some of the larger organisations to stand up to the software companies and refuse to have their harware architecture dictated by vendor sales models. Cut vendors with CPU licensing from the short-lists and they will soon change their thinking.
I dont know how long software companies think they can hang on to their 80s business models.