23 May 2002 Analysts at Gartner are advising corporate customers to “immediately review their Microsoft software licensing agreements” or risk facing massive increases in licence charges of up to 45% from 31 July.
This is the deadline set by the software giant for its clients to join its subscription-based ‘Software Assurance’ licensing scheme. Gartner says that clients must “evaluate their Microsoft licensing requirements and re-negotiate immediately where appropriate” with the software vendor.
Gartner says that the new ‘Select version 6’ agreement that will replace version 5 is not in the interest of clients. Instead of signing up to version 6, they ought to enter into “a new Select version 5 agreement” before the deadline passes.
Analyst Alvin Park is adamant that “a surprise cost increase” is on the cards for Microsoft software corporate users with the introduction of Software Assurance, “as Microsoft Upgrade Advantage and Select version 5 evaporate after 31 July.”
Under Software Assurance, organisations have to pay Microsoft an annual fee, which covers the cost of the upgrades when they are released. Customers who do not sign up to Software Assurance will be compelled to purchase new copies of Microsoft software at full price when they come out. Two thirds of Microsoft’s largest customers had reportedly still not joined Software Assurance less than two weeks ago.
Microsoft customers baulk at new licensing scheme (10 May 2002)