Why the headache of License Management could be a major push towards cloud adoption

I've been busy lately with various software license related assignments, not necessarily related to a cloud setup. 

And quickly I recognized all the headaches and frustration that comes with it, which are even more apparent when being active in cloud environments for the last decade or so.

Let's face it. Licenses are a major headache. Understanding the rules is ridiculously complex, and change all the time. And most of the time, these changes are not to lower your fees.

Strong software asset management discipline is a necessity, and while I will be the last one to claim that cloud will solve all these problems and make them redundant, it definitely will help in some cases.

For instance, one customer has an application (provided as a SaaS) with a very peaky behaviour. One week per month it needs massive power, the other three weeks it just cruises. Buying licenses for the peak capacity would be a very costly exercise, even more so given the SaaS characteristic of the service. You simply wants to scale with demand, both periodically as well as the growing customers, and traditional licensing models simply cope very badly in such scenarios. Cloud computing, in case licenses are included proves to be a major attraction to this types of customers.

Another customers needed to renew their enterprise agreement with another software vendor, and needed to make an inventory of what software is used, over time, and in what configurations. Should be simple enough, right? Not so, keeping track of everything, understanding all the rules and exceptions is close to impossible. Comparing that with ease in which you can launch enterprise applications in the cloud, and getting charged for using both hardware and software by the hour (or even minute), it is clear that there is something to be gained here.

Understand me correctly, I do not feel the cloud is a silver bullet that solves all such licensing issues, but the matter of fact is that it comes inherent with some features that makes life in this regard a lot easier. And in these two cases cloud computing was mentioned by the customer as an attractive setup, mainly because of the licensing restrictions.

I am convinced that this will prove to be a major battle ground, and by exploiting this cloud providers have a great opportunity to lure traditional enterprises to use their services.