Partner Advocate

Let's Fix Licensing

We can sit back and wait for Microsoft to tackle this all-important issue, or we can propose our own solution.

Microsoft Partners are a loyal lot, as our 2005 Partner Survey points out, but that doesn't stop them from voicing opinions, one of which came through loud and clear: Something needs to be done about licensing and pricing.

Taken together, responses to various questions in the survey point to an obvious trend. Asked what complaint customers voice most often about Microsoft, the top answer was "Products are too expensive," with 31 percent of responses. "Security is lacking" was second at 28 percent, followed by "Licensing is too complicated" at 26 percent (see "Taking the Partner Pulse").

If you lump the pricing and licensing responses together, which is perfectly legitimate given that they're intertwined, that comes to 57 percent—making licensing- or pricing-related complaints twice as frequent as those regarding security.

Sound crazy in these days of worms and spam? There's more. We also asked partners what their top challenges were in representing Microsoft technology to customers. Pricing topped the list at 51 percent, edging out security by nearly two percentage points. Asked whether licensing policies make products difficult to sell, nearly half of all partners (46 percent) said yes; only 27 percent said no.

None of this is news to Microsoft. The company does make an effort to listen to its partners (another survey finding), so it has heard all this before. In fact, Allison Watson, vice president of the Partner Sales and Marketing Group at Microsoft, told us not long ago that the company has several executive teams looking at making licensing "better and simpler" and that we'll see the results within the next year or two.

That means Microsoft Partners have time to help shape what Microsoft comes up with. I know you're full of opinions on the topic, so consider this your invitation to voice them.

What do you think Microsoft should do in terms of licensing? Extend the term on its Software Assurance (SA) contracts? Guarantee that SA customers get a product upgrade? Offer a core Client Access License (CAL) that covers more products? Get rid of CALs altogether? Offer fewer types of licenses? More? Reduce prices across the board?

In this issue, we've got a story on recent changes to the SA plan (see "New Software Assurance Plan Is Filled with Partner Goodies"). Over the last couple of years, Microsoft has been continually adding benefits to SA in hopes that customers will perceive value from the deal, even if they don't get a product upgrade within the three-year contract period. How is that going over with your customers? Is it enough, or do they think of SA primarily as an insurance policy that buys them upgrades? What more needs to be done with respect to SA?

These are just some of the licensing issues we'll be exploring. Drop me a line to share your thoughts, whether they be ideas on what Microsoft should do, issues you think we should explore or people we should talk to.

We'll be collecting responses and talking to experts (including partners) over the next several weeks to come up with a plan that we think is fair and equitable for Microsoft, its partners and customers alike. We'll publish the results in a future issue—and we'll send a copy to Microsoft.

Paul Desmond
Editor in Chief

About the Author

Paul Desmond, the founding editor in chief of Redmond Channel Partner magazine, is president of the IT publishing firm PDEdit in Southborough, Mass. Reach him at