Winning the SA Bet

Because Microsoft does not guarantee that customers who purchase Software Assurance (SA) will get an upgrade, the purchase of SA is always a gamble. Customers can match the cost of SA against the chance of an upgrade to reduce the chance that they will “lose the bet.”

The chart shows the cumulative annual cost of purchasing a hypothetical desktop product with a license cost of US$100 and then deploying a subsequent upgrade within the next six years. SA is an additional 29% each year. The “Year” column shows the year that the upgrade is deployed, not the year that Microsoft releases the upgrade. In Scenario A, the customer purchases a license and SA and amortizes the license cost over the first three years, paying only SA for the subsequent three years. In Scenario B, the customer purchases a license only; to receive an upgraded version, the customer must purchase a new license for the upgraded product.

The model assumes no price difference between the original and upgraded products. It also ignores the cost of capital and any SA training or technical support benefits that the customer might use.