What's Up With Microsoft Licensing?
New Uncertainty and Risks for Microsoft Users
MISHAWAKA. Microsoft has changed the way that it handles
volume software licensing, and has also made new products harder
to copy. The combination means new risks for users that
have been reluctant to upgrade as frequently as Microsoft would
like, or who have been lax in insuring that all users have their
own licensed copy of each program. Nearly all IT departments
will end up having to conduct "software audits" to
assess their license status.
The change in volume licensing deals appears to be part of
a move toward a rental model for software rather than ownership
by the user. Microsoft considers businesses with five
(5) or more PCs to be "volume users." Multiple
upgrade programs will be replaced by a new Software Assurance
Policy. In addition, companies with 250 or more PCs will
qualify for a new, three-year Select licensing agreement.
The changes were slated to go into effect October 1, 2001, but
Microsoft recently extended the deadline to February 28, 2002.
Many IT managers will have to conduct unexpected audits to
determine the status of their various software licenses.
There is a time-sensitive component to this. In the past,
as long as one owned a licensed version of a Microsoft product,
it qualified for an upgrade price to the current version of
that program. Under the new scheme, only products covered
by a Software Assurance Policy (SAP) can be upgraded; the cost
of upgrading is built into the SAP price. Since after
October 1 the upgrade option will not be available, companies
planning on upgrading their Microsoft products in the future
can save money by purchasing an SAP before that date.
A company that fails to buy an SAP before the deadline and later
decides to upgrade will probably end up having to pay the full
price for the new version. To add to the potential expense,
in order to buy an SAP, the PCs must be running "current"
software - meaning Windows 2000 (or another operating system
with an agreement to purchase Windows XP), and, for Office users,
Office 2000. Thus, economy-conscious users will have to
choose between the alternatives of doing nothing now and paying
full price for new product later, or spending the money now
both for an SAP and, where necessary, also for a software upgrade
to qualify for the SAP.
While these policy changes may look like Microsoft trying to
boost its revenue, the firm calculates that the majority of
firms will save money or at least pay no more under the new
plan. The firms that could see their cost go up will be
those that have been slow to adopt newer versions of products
and have upgraded infrequently.
New Copy Protection
If the complete revamping of software licensing schemes wasn't
enough to keep IT staffers busy, Microsoft is also clamping
down on casual copying of their products by the use of a Product
Activation feature. When Office XP, or the upcoming Windows
XP, are installed they examine the hardware and record a "fingerprint."
If one later attempts to reinstall the same product, and the
hardware fails to match what was found before, the installation
will fail. One must then contact Microsoft and provide
an explanation for the reinstallation on different hardware.
While we expect that Microsoft will be fairly reasonable with
their re-approval process to avoid a public relations disaster,
this new technology will force users to become more diligent
about keeping track of licenses, matching a given license to
a particular PC, and to avoid cutting corners while setting
up new machines.
It is likely that support issues will increase, particularly
with users who make changes to their computer's configuration
and trigger the copy protection scheme. A recent article
describes the author, a new user of Windows XP, experiencing
a nightmare scenario - at the beginning of an airplane flight,
his notebook-based Office XP suddenly informed him that it would
be shutting down most functions. A desktop user might
be able to correct this kind of situation fairly quickly by
telephone or Internet connection, but at 30,000 feet the communications
options are meager.
In short, we are entering a new world of Microsoft licensing.
IT departments in the budget planning process will have to review
their software expenditure forecasts to be sure previous assumptions
are still valid. In particular, companies that have been
lax about copying software, or who have used legal but older
versions of software, may find software expenditures on the
rise.
Further Reading:
Readers
to Microsoft: Copy Controls? No Way!
(PC World)
Office
XP Fast Facts (Microsoft)
Microsoft
Simplifies, Enhances Volume Licensing Programs (Microsoft)
Office
XP launch starts upgrade clock ticking (ComputerWorld)
Microsoft
License Shift Creates Turmoil (ComputerWorld)
Microsoft's
ultimatum: Upgrade to XP by October--or else (ZDNet)
MS
Office XP: Upgrade now or pay later (News.com)
Microsoft
to me: We're turning off your Office (ZDNet)
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CompStar Technologies is a leading Indiana-based provider of networking, technology, and communications services. With offices in Mishawaka (serving South Bend, Elkhart, Warsaw, Michigan City, Fort Wayne, Niles, St. Joseph, and Benton Harbor, Michigan) and Indianapolis, CompStar provides network design / support, network security, wireless networking, business telephone systems, VoIP (voice over IP), and cctv / video surveillance systems. CompStar is the Technology Division of Direct Line Communications, headquartered in Mishawaka, Indiana.
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