Licensing in the world of cloud computing and virtualization

In the traditional days of desktop application, companies started with product licenses that are valid for one machine only. then there came the concept of sharing a license across multiple machines(license server), but only one person can use the software at any particular instant of time. The number of persons need not only be one and can be any fixed number n. In the web world, licenses were controlled by the user name that can access the software , the ip address of the machine which is accessing the web based software and other means. Now comes the world of cloud computing and virtualization platform. How easy is going to be handling licenses?

With software audit at my organization a few days back for Microsoft related software, let me better understand the details. Historically, Microsoft applications lived in the one-processor/one-license premise. However, virtualization changes this paradigm. For example, applications can (and will) move from one server to another on a regular basis. If an application resides on two or three Hyper-V images during the day, does that mean you need two or three licenses?

Today it isn’t unusual for a single machine host a dozen or so instances of Windows Server 2008 so that each of several applications can have its own "server." How many server licenses should I purchase?

I was referred to a web site called, which is intended to be a resource center for all things licensing related to virtualization. This site is in addition to the already established Microsoft Volume Licensing site, which happens to have a pretty good section on virtualization and licensing. Then there is the Microsoft Virtualization site itself, which also touches on the subject.

With application Virtualization, server virtualization and cloud computing scenarios, licensing has become more complex. I want to make use of the latest in technology and at the same I do not want to use pirated software and neither want to keep 100 page documents. is there nay difference in licensing if i make use of Hyper-V based virtualization or VMware based virtualization? Can some one explain me or direct me to the right location?