Physical links break in a virtual world: Here’s why your software licensing models have to evolve beyond being chained to physical machine identifiers, and what you can do to fix it.
Software licensing is an important and integral part of software development as it is necessary to protect and monetize the IP of both software and hardware companies. Significant resources are spent on researching, developing, and supporting of software; and companies use software licensing as a must-have to recover that investment. Like everything else that evolves, software licensing models have evolved over the years to provide software producers more options over what and how to price products that are in line with how end customers buy software. However, what has not changed is that the vast majority of licenses are still linked to the hardware MAC (media access control) address of the network adapter or the serial number stored in the BIOS (basic input/output system) of the physical device. So the question becomes:
Should software producers continue to rely on a physical device identifier as the critical link to the software license? The simple answer is “no” – not if you want to survive in the digital era.
Emerging technologies such as Docker® containers, SDN (software defined networking), NFV (network function virtualization), virtual appliances, cloud-based applications, apps meshing and service oriented applications and many more are decoupling from running on physical hardware. Decoupling software from hardware allows faster time-to-market and allows end customers to utilize existing hardware more efficiently which helps reduce costs.
Software decoupling from hardware is becoming a trend that is heavily impacting software licensing that relies on hardware for protection; the simple reality is that software licensing needs to able to work in both physical and “virtual” worlds as well as make the migration between the two. Both software and hardware companies too often are forced to “make it work” without having options and support in resolving software licensing issues.
As an example, binding software licensing to a MAC address won’t work in a virtual environment since the devices are virtual. If the license is bound to a MAC address then the software license will fail, leaving end-users frustrated that they can’t realize the full potential of virtualization and will result in support calls to the software producer for licensing-related issues.
As an alternative solution to MAC address or other physical device binding, consider a cloud-based licensing server or usage-based licensing which helps you decouple licenses from the physical device. In some cases where migrating to these alternative approaches isn't possible, consider decoupling the unique device ID (e.g. MAC address) from the hardware by separating the identification from the software licensing binding and allow a grace period whenever a binding breaks. This way, if your physical or "virtual" device (e.g. damaged network adapter) needs to be replaced or has changed your entire software licensing ecosystem won’t fail.