TechnologyAccounting SoftwareCompanies bear brunt of Microsoft costs

Companies bear brunt of Microsoft costs

Companies using Microsoft software could find themselves severely out of pocket after the end of this month when the company's new licensing scheme comes into effect, analyst company Gartner has warned.

According to the research firm, companies that don’t acquire upgrade protection on their existing software licenses by 31 July could pay up to 45% more to repurchase their licenses the next time they wish to upgrade.

Gartner analyst Alvin Park said that after 31 July, Select version 5, Upgrade Advantage and Software Assurance on licenses acquired prior to 1 August 2002 will no longer be available.

‘After 31 July, enterprises can purchase new licenses with or without SA, but they can never upgrade the pre-existing licenses, only replace them,’ he said.

He said customers planning upgrades to Microsoft licenses should take the following actions:

‘If you contemplate upgrades to non-current version licenses, consider entering into a new Open version 6 or Select version 5 volume purchasing agreement with Microsoft to maximize the upgrade protection period.’

‘Although UA can be purchased under Open version 6, it cannot be purchased under a Version 6 Select agreement. Microsoft has created a Select version 5 amendment to expedite this process. Large account resellers should be able to give you the details.’

He advised companies to evaluate their upgrade plans for non-current version products. ‘If you plan upgrades in the near term, consider purchasing UA on them prior to the 31 July deadline. Examples include Office 97, Windows NT 4.0 Server, Exchange 5.5 and SQL Server 7.5.’

Enterprises should also evaluate upgrade plans for current version products, and if you plan upgrades in the near term, consider purchasing SA on them before the deadline and also evaluate special Microsoft promotion and incentive offerings available through 31 July 2002 on the Windows Server operating system, Microsoft Project, and the suite of Microsoft Developer tools or Microsoft Developer Network licenses, Park advised.Gartner’s warning follows similar advice from research company Giga, which urged companies to make any negotiations with Microsoft last month if they wanted to get the best deals on the new licensing scheme.Although companies have until 31 July to do deals before the new licensing regime comes into effect, because Microsoft’s financial year ended at the end of June, Giga said the software giant would be more willing to do deals.

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