Microsoft is continuing to try to make amends for the mistakes it made when it launched its Software Assurance volume-licensing scheme last fall.
The latest concession: The Redmond software giant is adding a new option to its licensing terms to allow customers who purchase products through OEMs (PC and server makers) to sign up for Software Assurance.
Starting with Office 2003, Microsoft will allow customers to enroll their OEM licenses for Office Professional 2003 and/or Office Small Business Edition 2003 in the Software Assurance program. OEMs are slated to begin offering customers machines preloaded with Office 2003 in late September; retail availability of the product is set at October 21.
Microsoft has other concessions coming, several of which take effect on September 1.
Among the new, previously announced Software Assurance freebies on tap for Monday are more Web-based tech support; training for specific products; home-use rights for Office; and new software tools, like corporate error-reporting, for Software Assurance customers and their IT Managers.
Later next month, when Microsoft begins rolling out Office 2003 to its volume-license customers, other concessions will kick in. This summer, Microsoft announced that it plans to offer certain Office Standard Edition customers the right to upgrade to Office Professional Edition at no extra cost.
While it hammers out details of these myriad licensing programs, Microsoft is continuing to forge ahead with an initiative it began more than a year ago to simplify licensing across the boards. Originally called “Licensing Simplification,” the effort, now called “Licensing Rationalization” – aims to make all Microsofts licensing programs more coherent and cohesive.
“Its going to get worse before it gets better,” warns licensing product manager Rebecca LaBrunerie. Especially because “one persons simplification is anothers lack of choice.”
It has been just over a year since Microsoft officially instituted its much-maligned Software Assurance/Licensing 6.0 volume-licensing programs.
Software Assurance represents Microsofts first major foray into annuity-based licensing. Under the plan, customers are charged a percentage (roughly 30 percent per year over three years) of the total cost of their desktop and/or server wares. In exchange, they “buy” guaranteed maintenance on their software and are supplied with service packs and new releases, as they become available.
But months before the new licensing policies went into effect, customers were grumbling about the terms and conditions that Microsoft was set to impose. A number of customers and market watchers warned the program would result in a number of users paying more for their products.
To attempt to make amends, during the past year Microsoft has gone back to almost every one of its enterprise and mid-size customers — either via its own direct sales force or through its third-party integrators and reseller partners — and asked customers what would lessen their licensing pain.
In fact, since introducing Software Assurance, Microsoft has talked to nearly every customer three to eight times, says LaBrunerie. LaBrunerie estimates Microsoft spent $20 million to reach out and query its customers on their licensing beefs.
In the ensuing months, Microsoft attempted to appease customers by making some of their requested licensing tweaks. On March 1st, for example, the corporate-licensing unit quietly made some changes to its volume licensing contracts. These included expanding the product warranty period from 90 days to one year; giving users more advance notice of a Microsoft software audit (30 days, instead of 15); and indemnifying customers for an amount equal to their software purchase value.
Also in March, Microsoft kicked off “Open Value,” a new volume-licensing program for its small/mid-size business customers. Open Value allow SMBs with between five and 250 PCs to spread out their licensing payments in order to ease the burdens imposed by Microsofts Software Assurance/Licensing 6.0 programs.
This is an updated version of an article which appeared in the August 12 issue of the newsletter.