Microsoft Licensing

A Software Assurance (SA) renewal grace period and an SA benefit that gave employees discounted Microsoft software have been eliminated. The changes may signal that Microsoft is taking a closer look at SA benefits that do little to promote SA but raise Microsoft's costs. The changes affect two elements of the SA program, the Employee Purchase Program (EPP) and the SA renewal grace period.

EPP Benefit to End

The EPP will expire Nov. 15, 2010. It lets an organization's employees purchase a broad range of business and consumer software and hardware (including Xbox games and Zune music players) from a Microsoft Web site. EPP overlaps with the Home Use Program (HUP), another SA benefit that continues to be available, which lets employees purchase a copy of Office for home use. The EPP offered employees a greater choice of software than the HUP, and the HUP offered less incremental value, since even without SA, Office Standard and Professional Plus users have the right to install a second copy of Microsoft application software on a portable computer.

However, Microsoft found customers were far more likely to purchase important products like Office through the HUP than through the EPP. The cost of Office through EPP, although discounted significantly, was still higher than its cost through the HUP. In addition, access to the EPP was very restrictive: customers not only needed SA on Office licenses but they also had to have SA Membership, in which they agreed to purchase SA on all desktop applications, including Project, Visio, and Visual Studio. Even among customers eligible for EPP, Microsoft says utilization of the benefit was very low.
As compensation for the loss of the EPP, Microsoft will give customers a 15% discount to purchase any Microsoft product (except computers) at the Microsoft online store between Nov. 15, 2010 and Feb. 15, 2011. The store sells a larger range of products than were available through the EPP. For example, employees could buy Xbox game consoles through during this time.

SA Grace Period Eliminated

The grace period for renewing SA has been eliminated in most volume purchasing programs, for agreements signed in 2010 or later. The grace period let customers renew SA up to 30 or 90 days (depending on the volume agreement) after their volume licensing agreements ended. Customers who want to continue SA benefits should plan renewal of their license agreements ahead of time: if they let the agreement expire, recovering their SA rights will require the purchase of new licenses, to which they must then add SA. The grace period has been eliminated for all Microsoft volume licensing programs except Open License, where a 90-day grace period continues.

Detailed rules about SA benefits and renewal can be found in the monthly product list, available at www.microsoft.com/licensing/about-licensing/product-licensing.aspx#tab=2.