Microsoft yesterday announced a major change in its software
licensing structure. From 1st October, it is selling optional
“Software Assurance” contracts that require customers to pay an
annual fee for upgrades while large businesses will have the option
of buying three-year subscriptions for Windows, Office and server
software instead of perpetual licences.
When large businesses buy software for hundreds of computers,
they sign volume-licensing agreements. Not only are these
agreements more convenient than buying hundreds of individual boxes
of software, they are also less expensive. Microsoft is changing
its volume licensing programs, making it easier for organisations
to upgrade and maintain their software, through a new Enterprise
Agreement Subscription service, and, it says, maintaining or
reducing licensing costs for the vast majority of Microsoft’s
enterprise customers. However, at the end of the three-year
licensing period, the customers will not be able to continue using
the software as they can under current agreements.
Bill Henningsgaard, vice president of Microsoft Worldwide
Licensing and Pricing said the new licensing programs affect only
Microsoft’s volume customers. He added, “our new Enterprise
Agreement Subscription program is a first step toward offering
software-as-a-service.”
While costs under the Software Assurance plan will remain the
same or drop for many large companies, those only upgrading
Microsoft programs every three or four years will suffer increased
costs.
