GigaOM

Cloud computing is based on a pay-as-you-go, self-provisioning utility model. Users are billed by the hour. On the other hand, software vendors are accustomed to shrinkwrap licenses, making it hard for cloud users to get the software they want on an on-demand basis. But as CNET reports, Microsoft has relaxed licensing for virtual machines licensing, opening the door for hosting providers to reinvent themselves as true clouds.

Until now, Microsoft’s software was tied to a physical server. Administrators could only move it from one physical machine to another four times a year, making it a nonstarter for many virtual environments. For hosting providers, the best Microsoft could do was its Service Provider Licensing Agreement, which was priced month-to-month. While that might be acceptable for a long-term contract with a hosting provider, a month is an eternity for on-demand clouds that spin up machines for an hour at a time.

This has meant that clouds have had to restrict themselves to just open source, or to pursue a narrow market where licensing is less restrictive. Cloud provider Skytap’s Virtual Lab, for example, focuses on testing in part because licensing test systems through the Microsoft Developer Network is much more flexible. Testing is also a “gateway drug” for broader cloud computing adoption: It’s bursty and not mission-critical. “Customers are reluctant to put production in the cloud, but they’re willing to put QA there,” said Ian Knox, Skytap’s Director of Product Management.

Microsoft’s licensing changes are aimed at its newly launched virtualization offering. But they’ll have another important consequence: By lifting licensing restrictions, Microsoft lets hosting providers provision and decommission servers far more frequently, allowing them to build true utility offerings around Microsoft’s servers and painting themselves with cloud stripes.

We have received quite a few submissions for the Startup LaunchPad at our Mobilize 08 conference that is scheduled to be held on September 18, 2008 in San Francisco. I wanted to remind everyone that the deadline for applications ends tomorrow, August 20. We will announce a short list of companies on Monday, August 25.

As a reminder, I want to stress the fact that you don’t need to be a venture-backed company. If you are a single developer with a great app and are ready to show off, you are more than welcome, but you better hurry. You can go here to submit your applications. For those who wish to attend the conference, I just want you to know that our $100 discount ends August 29, so it might be good time to save some cash.

Muxtape, a startup that quickly became a favorite of the Tumblr-set, has taken a nose dive, thanks to the machinations at RIAA. There are lot of folks bemoaning the loss of the service. To them, I have one word: 8Tracks.

I talked to the New York-based startup’s founder, David Porter, formerly of Live365, a few weeks ago and he walked me through the service. I have been using it sporadically and, well, it works better than Muxtape. (Thrillist thinks so, too — take their word over a Web geezer like us.) Essentially, 8tracks allows you to upload your own tracks and create a mix. Of course, you can create mixes from a library of tracks uploaded by others. Drag, drop, play!

How long before RIAA calls on these guys? They have applied for a small webcaster license, but that won’t be enough if the company gets popular. Peter Kafka says they they will “end up having to pay the same rates as the big guys, which basically translates to about 2 cents per listener, per hour this year, and will jump to 3 cents next year.” Porter remains undeterred!

• Earth2Tech: Bill Clinton: 10 Things the U.S. Government Should Do For Clean Power.
• NewTeeVee: Ultimate bloke show, Top Gear, has its own YouTube channel. Awesome!
• jkOnTheRun: Houston, Texas has launched city wide WiFi.
• NewTeeVee: Vuclip is big on mobiles. Who knew?
• OStatic: Waiting for a new class of devices: Mozilla, ARM & Others.

OK, that is a bit over the top! Nielsen Mobile came out with a report that points out that there were 13 million mobile data cards in the U.S. at the end of June 2008. Not a big surprise, since wireless carriers in the U.S. are having a blockbuster year as far as mobile Internet revenues are concerned. The GigaOM Team has about seven of them and uses them for business and filing stuff when on the road. Apparently, so do a lot of people. However, Nielsen points out that there is a change in the making.

…Nielsen’s research reveals that the cards are beginning to play an important role in home and personal Internet access, as well. In fact, 43 percent of mobile data card users report they most often use their data card at home, while 15 percent say they typically use the card at work. Additionally, one in five (21 percent) data card subscribers take advantage of ubiquitous access by heading outdoors and 9 percent use their card while commuting.

An easy explanation would be better price packages and higher speed tiers, thanks to newer 3G technologies. Of the nearly 1,300 mobile data card users Nielsen surveyed, more than 99 percent still kept their wired broadband service: 40 percent of card users also have cable broadband and 34 percent also have DSL in their home. That number can jump to 59 percent, giving wired carriers something to think about.

Maybe the wireless guys need to rethink their wireless broadband plans and bring them forward. For phone companies the prospect of being cannibalized by wireless data connections must be scarier than losing them to voice connections. No wonder they started to limit bandwidth transfers on their connections. (Photo courtesy: Novatel Wireless.)

Verizon recently launched its FiOS TV and fiber-based broadband service in New York City, The New York Times is taking stock of the service, which seems to be doing well. Verizon’s $23 billion investment into FiOS wasn’t viewed kindly, and Wall Street viewed AT&T’s cheaper U-Verse plan as more practical and affordable.

Despite such early shellacking on Wall Street, the company’s decision to go with the more expensive fiber is proving to be smarter, even though it is still not clear if (and when) Verizon is going to start making big money on its bet.

“If I were an auto dealer and I wanted to give people a Maserati for the price of a Volkswagen, I’d have some seriously happy customers,” said Craig Moffett, an analyst with Sanford C. Bernstein. “My problem would be whether I could earn a decent return doing it.”

Moffet estimates that the company is going to lose about $6 billion on FiOS all told. Others feel that 20 percent buy-in from potential customers makes it profitable. Wall Street seems to have warmed up to the Verizon story, impressed perhaps by its recent growth, especially when stacked up against AT&T.

My view is that all U.S. phone companies are in trouble because of major shifts that are going on in the industry. Verizon, with FiOS, at least has an offering that addresses the needs of the future broadband users. Whether they make money on it, who knows.

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