(Stewart Buchanan, ZDNet) Virtualization can produce some nasty surprises in licensing costs, so it repays to study the small print. Whatever people may imagine, the fact is that application virtualization can create higher than expected licensing costs. It is important that customers understand that some software vendors earn more by not changing their licenses to accommodate new uses of virtualization, and that licensing in this area is a matter for negotiation.

As customers look for greater flexibility in the way they deliver applications to employees and external partners, some cost increases seem inevitable. However, these costs could be extreme for customers who do not understand the implications of licensing.

So, before investing, user organizations need to calculate the impact of virtualization on the life cycle total cost of ownership of all existing software. It may be unrealistic to expect all new and more flexible ways of using software to cost less.

Organizations should also check vendor licensing rules and get independent advice. It is worth having licensing examples in writing with illustrations and including them in your contract. Where vendor rules continue to be inflexible, IT managers can look at external service offerings that include software costs.