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Microsoft unveils licensing plan for business
Number of options creeping up…

By Ina Fried

Published: Tuesday 01 July 2008

Microsoft has said it is adding a new licensing option, this one dubbed Select Plus and targeted largely at medium-sized companies.

The programme's two main attractions are the fact it is not tied to a specific term and it makes it easier for different subsidiaries of a company to take advantage of their combined purchasing power.

The additional option runs counter to the trend at Microsoft, which has been working to scale back the number of different licensing plans. The company had managed to shrink its number of options - from 107 programmes in 2006 to 23 as of last year. With Select Plus, the number of Microsoft licensing programmes has crept back up to 26.

Although it adds yet another option, Joe Matz, corporate vice president at Microsoft, said that Select Plus fills a need.

He said: "Many customers end up with multiple agreements because Select is not as flexible as customers would like." Microsoft isn't getting rid of Select but expects that, over time, customers will choose the new option.

The software maker has come under criticism from some customers and analysts for both the cost and the complexity of its licensing programmes.

In a recent report, analysis firm Forrester advised its clients to plan months ahead to figure out which Microsoft licensing option made the most financial sense. It also said Microsoft's Software Assurance support programme is more expensive compared with rivals.

Forrester said in the report: "Microsoft's software maintenance agreement is among the industry's most expensive - 25 per cent for server products and 29 per cent for desktop products. In terms of upgrade rights - the major element - this is only cost-justified by a three- to four-year upgrade cycle but Microsoft has undermined Software Assurance's value proposition by missing delivery dates for new versions."