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OnLive Relents but Fight Continues Over Microsoft VDA Licensing

Gaming and desktop-as-a-service (DaaS) provider OnLive now appears to be complying with Microsoft's virtual desktop licensing restrictions.

OnLive's low-cost services led to a public spat over how it was licensing Windows 7 to provide virtual desktop infrastructure services. The dispute turned ugly last month after Joe Matz, Microsoft corporate vice president of worldwide pricing and licensing, called out the company for running virtual desktops to customers using Windows 7, which violates Microsoft's Service Provider License Agreement (SPLA) stipulations for service providers delivering remote desktops. Microsoft issues SPLA licensing to service providers only when using Windows Server 2008 R2 for delivery of remote desktops.

OnLive had been using Windows 7 to remotely deliver desktop and Office applications to Apple iPod and Android tablet users for free. It also offered relatively low-cost monthly plans that added DropBox, Gmail and extra storage options to the service.

The company's switch to using Windows Server 2008 R2 was described on Saturday in a news post by Ed Krassenstein, an editor at OnLiveFans.com. Users of the service noted a change in a keyboard display and discovered that Windows Server 2008 R2 was now running under the hood of OnLive's service. If that's so, then the switch potentially represents a permitted use of the software under Microsoft's Virtual Desktop Access (VDA) and SPLA licensing. But while Microsoft may have won this battle with OnLive, it still faces grumblings from its partners working on the front lines provide hosted desktop services to customers.

Brian Madden, a Microsoft MVP who relinquished his title in protest of Microsoft's VDA licensing restrictions, made it clear that all is not well for DaaS providers, given Microsoft's approach. He accused Microsoft of killing the DaaS industry.

"Microsoft is still screwing the desktop industry by not having an SPLA for Windows desktops and for having those crazy policies on multitenancy," Madden wrote in an April 9 blog post. He had explained in a previous post that Microsoft's VDA licensing prohibits Windows 7 to be used to deliver hosted desktops using shared hardware, otherwise known as "multitenancy," according to service-provider lingo.

The protest by Microsoft's DaaS partners continues with the creation of a DesktopsOnDemand Web site. The site will offer Windows 7-based DaaS services in the United States in the second quarter of this year, possibly this month, while starting up in European Union countries in the third or fourth quarter of this year. DesktopsOnDemand is being spearheaded by DaaS provider tuCloud, in collaboration with Desktone, according to a tuCloud press release (PDF).

tuCloud CEO Guise Bule didn't mince words about what he sees as wrong with Microsoft's VDA and SPLA licensing. He even critiqued using Windows Server 2008 R2 to deliver a desktop experience.

"We saw them [Microsoft] take stabs at VDI [virtual desktop infrastructure]," Bule wrote in a DABCC article. "Terminal Services became Remote Desktop Services which of course fooled no-one, even Microsoft cannot convince the world that a server OS is a suitable replacement for a Desktop OS."

Bule noted that he must turn away many small-to-medium enterprise clients because of the costs and complexity of Microsoft's VDA licensing for delivering hosted desktops. In contrast, organizations large enough to afford Microsoft's upper-end Software Assurance licensing option get VDA coverage thrown in at no additional cost, he noted. He advised Microsoft to open up its VDA desktop licensing to customers "in the way that will most add value to their own organizations, whilst they still want to use Windows."

DesktopsOnDemand appears designed to provoke Microsoft into a fight over the issue.

"If they sue that business, I'll appear in court and shout and scream 'antitrust, anticompetitive behavior'," Bule said, according to an Ars Technica article. "I don't think they want that because they can't justify their licensing."

About the Author

Kurt Mackie is senior news producer for the 1105 Enterprise Computing Group.

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