News

Enterprises Expected To Feel Pricing Pain

SAN FRANCISCO -- Microsoft is leveraging its terms and conditions to increase revenues, and organizations using its software should expect to pay up to 50 percent more per year through 2002 as a result. That’s the warning issued by Tom Bittman, VP and research director for GartnerGroup, during a keynote at the company’s fourth annual Windows NT and Windows 2000 conference here this week. Bittman said the majority of enterprises installing or upgrading to Windows 200x technology will pay up to 80 percent more in license fees, through 2003, as compared to a deployment of Millenium Edition (Microsoft’s next 9x release) and Windows NT 4.0. Although list prices haven’t really changed, he said, "upgrade pricing has increased dramatically."

At the heart of the increases are several crucial changes to terms and conditions for licensing Windows 2000: Client Access Licenses are now required for all authenticated users (and the Windows 2000 logo compatibility program requires use of Windows 2000 authentication); authenticated Internet users now require CALs or Internet Connector licenses; a Terminal Services CAL is now required even if the organization uses an alternative vendor’s terminal server offering. The changes, according to Bittman, make it difficult for companies to "cost-justify the use of alternative vendors’ products," particularly Novell’s (www.novell.com) NDS and Citrix (www.citrix.com) MetaFrame.

A more dramatic shift in revenue will occur, Bittman said, as Microsoft (www.microsoft.com) moves from a "buying-the-bits once" revenue model to a "rental model." In the latter scenario, companies would pay for the right to use Microsoft software for a fixed period. When the period ends, the companies would pay additional fees or un-install the licenses. GartnerGroup (www.gartner.com) expects to see non-perpetual licenses becoming a standard option within Microsoft’s corporate licensing agreements by the end of this year. - Dian Schaffhauser

Dian Schaffhauser is the Executive Editor for MCP Magazine.

About the Author

Scott Bekker is editor in chief of Redmond Channel Partner magazine.

Featured

  • Azure Networking Enhancements Announced at Ignite

    Azure networking improvements were announced by Microsoft as part of its Ignite Conference.

  • How To Reclaim Your Privacy from Windows 10, Part 2

    These are the top four privacy settings to check in your Windows device to make sure Microsoft doesn't collect any data you don't want it to.

  • Microsoft Releases Out-of-Band Security Patches for Exchange Server

    Microsoft on Tuesday released out-of-band security patches for Exchange Server to address multiple zero-day flaws that are currently being exploited in active attacks.

  • Microsoft Mesh for Building Mixed Reality Apps Highlighted at Ignite

    The Microsoft Ignite Day 1 keynote presentations were heavy with talk about Microsoft Mesh, a new Microsoft Azure-based platform for building "cross-platform mixed reality apps" for multiple participants.

comments powered by Disqus