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Microsoft System Center 2012 overhauls licensing, focuses on apps

Latest Microsoft management platform supports server application self-service deployment

By , Network World
April 19, 2012 06:05 PM ET

Network World - Microsoft has formally shipped System Center 2012 management platform, adding features that create application-centric views of corporate infrastructure and - just as important - implementing a new licensing scheme designed to capitalize on customers' frustration with the leading competitor, VMware.

Microsoft says the new licensing structure cuts the number of license packages to two - standard and data center - down from nearly 100, a move the company says will make life simpler for IT departments.

Rather than buying the component parts of System Center singly or in bundles of just a few, customers will buy the entire suite.

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That's good news for the largest businesses that are heavily investing in private cloud architectures and buy the data center license, says Paul DeGroot, principal consultant at Pica Communications.

The price of a data center license jumps from $2,620 for two processors and unlimited virtual machines to $3,615, he says. "There might be a bigger initial payment, but it covers all the virtual machines on a server," he says, as well as the full suite of features, including new ones. "This is a very significant change."

While new customers will still be able to buy certain individual components as standalone products the option of buying just single components of System Center such as Configuration Manager or Operations Manager are pretty much gone. "It's all or nothing, folks," he says. "You're either going to use [Microsoft] management tools to do everything or you're not going to use [Microsoft] management tools. They expect most will take the first choice."

He says this follows the successful model of VMware and pricing for its management platform. And Microsoft does regard VMware as a top competitor of System Center 2012, says Edwin Yuen, the company's director of cloud and virtualization strategy.

The old licensing system with scores of bundle options was complex, DeGroot says, and often led to confusion. For example, if a customer wanted a System Center bundle that included a component they had already licensed for another purpose, it involved negotiation to decide what the additional license fee should be, he says.

Under the new structure, even if customers wind up buying a bundle that includes pieces they never use, the cost is manageable. "These products aren't terribly expensive compared to, say, SQL Server," he says. "This isn't a break-the-bank situation."

It could even save them money, says Don Retallack, an analyst with Directions on Microsoft, depending on the blend of physical and virtual machines in their infrastructure. Current customers will be eligible for grants from Microsoft to ease the cost of upgrading, he says.

The pricing structure is important, says Matt Stratton, director of technology operations for online rental service Shifting from VMware to System Center 2012 resulted in a 70% savings in maintenance costs, he says. The company beta tested the platform and switched over to it before its general release.

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