** Love Might Be Forever, But What About MS Licenses?

Microsoft is expected to announce changes to the way it licenses 
its software to large companies today, including the possibility 
of more emphasis on agreements that expire after a few years.

In a research note issued earlier this week, UBS Warburg analyst 
Don Young said Microsoft has recently proposed deals with 
business customers providing three-year subscription licenses 
that require companies to renew at the end of the deal's term. 
Microsoft has also offered to buy back existing perpetual 
licenses, the vendor's usual method of selling to large 
companies, in which customers own the software they purchase 
forever.

The changes are expected to primarily affect Microsoft's 
enterprise-agreement licenses, in which companies pay for 
software up front, then receive any upgrades to those products 
released during the agreement's term. After the agreements 
expire, many companies are happy to keep running what's installed 
for several years.

But Microsoft is looking for ways to uncouple its license 
agreements from new PC sales, which generate upgrades but aren't 
growing as quickly anymore. Selling more subscription licenses to 
products such as Windows and Office would be a step in that 
direction. Less clear is how Microsoft can achieve its revenue 
goals without alienating customers with what effectively would be 
price increases. - Aaron Ricadela

See the full story at:
http://update.informationweek.com/cgi-bin4/flo?y=eDfm0BdFGA0V20Nml0AT

Discuss this article in the Listening Post!
http://update.informationweek.com/cgi-bin4/flo?y=eDfm0BdFGA0V20Nmm0AU
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