Third-Party Software Licensing in Application Modernization Projects (It’s Complicated)


Most customers must address the issue of software licensing when they undertake Application Modernization projects.

I own the software - licensing is a non-issue, right?

If customers are modernizing or migrating a custom-developed, in-house application along with the associated software stack, they often believe that licensing is a non-issue. They own the software and can move the application and its software components to whatever new server and operating system they choose. Not so fast - software licensing can in fact become complicated, and quickly.

AppZero’s position is clear. Our automated modernization software cannot be used by customers to avoid third-party software licensing. We do not generate vendor authorization keys for customers, although we will move an authorized license even if it is tied to a specific hardware component or OS version.

Upgrading can drive associated license and maintenance costs

In fact, by virtue of upgrading to new servers and OS versions, AppZero typically drives additional license and maintenance revenue for software vendors. If a license key needs to be regenerated by a vendor, the process is normally as simple as contacting the ISV and paying the fee they may charge for new server authorization. If the original server will be retired, the application license is often transferable.

Consider the case of custom-developed applications built on a Microsoft stack. When customers modernize to a new server and operating system, they may also need to modernize and upgrade to new SQL Server and WebSphere stack versions. Depending on the nature of the licensing agreement, upgrading can drive associated license and maintenance costs. Each customer’s scenario is unique and many upgrades are covered by MLA or other vendor licensing agreements. 

Frequently, ISV software licenses are silent on the issue of OS versions and customers can reasonably assume that they are authorized to move an existing licence of old ISV software to a new OS version if they stay on the same size server and continue to pay maintenance or other software charges. ISVs realize that keeping customers using their software opens the door to future application upgrades and additional maintenance.

Did you say ransom fee?

In some cases, an ISV may attempt to make customers pay an onerous ransom fee for adding little new functionality (other than a move to a new vendor-supported Operating System version). Not surprising in such cases if customers look to technology that helps them containerize and isolate applications to run on a new OS as they bridge to new datacenter server or cloud environments.

Given open source, ISV software licenses, and third-party tools, the issue of software licensing can quickly become complex and must be considered when software is modernized or moved to new server or cloud platforms. At AppZero, we help customers deal with these issues daily. We can help find the right solution for modernizing software to make the right decision for your business.

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About AppZero

AppZero’s products and services provide a fast, flexible way to move server applications to a cloud or datacenter, without code change. Encapsulating Windows applications in VM/OS-free containers, AppZero’s patented software moves most Windows server applications with ease. AppZero allows you to move applications from an old OS to a newer one, and to modernize and move to the cloud efficiently.

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