Major Makeover for Volume Licensing

Sweeping changes to Microsoft’s volume licensing programs will introduce the company’s first software subscription program and alter the terms under which volume licensing customers upgrade software. The changes contain significant inducements for volume licensing customers to upgrade their software regularly, which might boost Microsoft’s revenues and reduce support costs associated with “legacy” software. The changes could also be a boon to Microsoft’s Office XP and Windows 2000 by establishing them as the baseline for future upgrades and premium support options.

Although Microsoft says the changes will be revenue-neutral, the impact on customers will vary. Some will save money, and others will spend more on software. Microsoft’s cost calculations might also understate the real cost to customers, as these calculations are limited to the software itself and do not include other costs associated with upgrades, such as planning, hardware upgrades, deployment, and training.