The emergence of license management as a primary issue among enterprise cloud computing users, customers and providers was reinforced this week when the DMTF announced its plans to study and address a need for software licensing standards in virtualized and cloud computing IT environments.

We first saw the prominence of license management in today’s enterprise IT when we asked in December 2009 more than 1,700 open source users and customers to rank the sources of cost savings from open source. About 83% said software licenses, meaning royalties, provided cost savings. The next most prominent answer was license management, which was identified by more than 54% of respondents as a source of cost savings from open source. Other sources of cost savings included: maintenance contracts (which is similar and related in regards to this blog post), hardware, support, productivity and development.

Still, concerns and cost pains associated with license management are part of a theme that has been resonating among both customers and providers, and I believe it is among the primary drivers of open source in cloud computing. Open source is not only associated with cost savings, it is associated with greater ease and simplicity in licensing. After all, if you’re concerned about figuring out and paying for the cloud computing resources you use instead of taking advantage of those resources, you can always just use the free, unpaid software if it is open source. While there may well be similar licensing headaches awaiting customers of commercial open source software, the fact of the matter is open source does provide more flexibility and open source is no-doubt associated positively with cost savings, license management savings and general user empowerment.

We also discussed the importance of license management and related open source advantages when we highlighted the year 2011 for Linux. In addition, the work of the DMTF and the issue of license management also plays into our recent take on the pillars of openness in today’s enterprise IT landscape.

It also makes sense that license management and keeping track of what you are paying for in cloud computing would be a major concern for customers who need elasticity in pricing and instant ability to scale up or down without calling in the lawyers and accountants each time. Thus, vendors are walking the line between generating as much revenue from their technology and services as possible, but aso providing users and customers the ability to utilize cloud computing resources in a way that matches the technology – with agility, flexibility, speed, scalability and stability. Basically, if you’re gearing up for the tax deadline, or Superbowl or Valentine’s Day or whatever, you don’t have the time or staff for a license audit. At the same time, your cloud computing providers cannot simply allow you to use as much bandwidth and other resources as needed without keeping a tab. Just as the DMTF, we will continue to watch this issue and we are hopeful that the prominence and significance of open source software in today’s enterprise IT drives more open cloud standards, including those for license management.