Option 1: Do nothing
For now, simply stick with your current versions of Microsoft products. After all, one reason why many organisations upgrade software much more slowly than Microsoft would like is that they do not see sufficient additional benefit in moving to the latest version. Many organisations are still running quite happily with their current versions of Windows and Office.
If you have taken out Upgrade Advantage on some products you can still use this to upgrade at a discount to products launched during the term of the deal.
Doing nothing obviously avoids any immediate extra cost, and delays the need to embark on the accelerated Microsoft upgrade treadmill.
But eventually you will have to upgrade. Third-party software suppliers will continue to migrate their products to run with the latest versions. Trading partners will upgrade and make it difficult to share documents. And you are likely to face an internal revolt eventually, as end-users demand to use more up-to-date software.
When you are finally forced to move to newer versions, assuming current pricing, the upgrade will cost more than double what it would have before the abolition of the current upgrade discount schemes.
Option 2: Buy version upgrades before 1 October
Make the most of the opportunity to get a discounted version upgrade before 1 October, either to the latest version of products or to a more recent copy than you run now. If you upgrade to the latest version, you have the option of adding Software Assurance before 28 February.
Version upgrade costs less than half the price of taking out a new "L" licence after 1 October.
But unless you take the Software Assurance option, you still have to decide what to do about future upgrades, just like in Option 1. Taking a version upgrade now simply defers the problem.
Option 3: Buy Upgrade Advantage before 28 February
Signing up to Upgrade Advantage for products before the cut-off date next February enables you to upgrade to the latest version of those products and any subsequent version launched either before or during the period covered by the deal, all for about 5% more than the cost of a version upgrade.
Upgrade Advantage runs for two years or until your current Select or Open volume licensing agreement runs out. So to get the most from this option you need to move quickly and sign up to a new Select 5.0 agreement before 1 October - even if your current one has not expired.
You do not have to actually upgrade during the term of the deal. You can upgrade years afterwards, as long as the version you are upgrading to was launched either before or during the Upgrade Advantage agreement period. So, if you are happy to run a version or two behind the latest version of Microsoft code, this option enables you to continue to upgrade for several years without paying any more.
At the end of the agreement period customers can convert to Microsoft's new Software Assurance maintenance programme - for an annual fee.
Option 4: Sign up to Enterprise Agreement
Bite the bullet, accept that you are going to pay for regular upgrades and take out an Enterprise Agreement to get the volume discounts and simplified licence management this offers. Under Enterprise Agreement 6.0 licences automatically come with Software Assurance upgrade protection. If you have at least 250 desktops and are planning to upgrade every two or three years but want to retain the ability to step off the upgrade treadmill at some point and retain perpetual rights to use your software, this is probably the cheapest option in the long-term. But if your business is currently happy to upgrade every three, four or even five years, this option will probably double your costs.
Option 5: Move to subscription licensing
If you are confident that you will continue to upgrade to new Microsoft products virtually as they come out, then taking the subscription licensing option saves you 15% on a conventional Enterprise Agreement.
But you never own perpetual rights to the software you use under this deal. So you cannot step off the upgrade treadmill, unless you are willing to stop using the software, or stump up a lump sum of one and a half times the annual cost of your enterprise agreement to buy out of the deal and gain perpetual rights to the software.
Option 6: Migrate to non-Microsoft products
Many users, angered by the proposed changes to Microsoft's licensing regime, have talked about moving to non-Microsoft alternatives - for example, Sun's Star Office instead of Microsoft Office.
Companies that specialise in helping to move to Microsoft alternatives report a big upsurge in interest. But for many organisations such a move is prohibitively disruptive.
Unplugging a key piece of software, especially if it links to other home-grown and third-party software, can be a complex and risky business. And abandoning the de-facto global standard that Microsoft has created for desktop software can make it harder to interact with Microsoft-based trading partners (not being able to share special features in MS Word documents, for example) and create a training and recruitment headache.
This is an option, but in the short-term not a cheap or easy one.
Option 7: Co-ordinate pressure to force Microsoft U-turn
So far Microsoft has stood firm in the face of mounting user criticism of the proposed changes, although it has bowed to customer pressure by extending the deadlines for taking out Upgrade Advantage and for enrolling current products in the Software Assurance scheme until 28 February.
In the UK, many individual users and user groups are now lobbying Microsoft for changes. Last month Elite, the British Computer Society's IT directors' forum, Imis, the information management professional body, and Socitm, the local authority IT managers group, wrote jointly to Microsoft's UK chief executive Neil Holloway asking him to delay the introduction of the changes until 31 May.
Analyst group Gartner has recommended that users put pressure on Microsoft to make the following changes:
- Let Office 2000 rather than Office XP count as the current version of Office when taking out Software Assurance - XP only arrived in May and very few organisations are using it
- Retain version upgrades, enabling users to upgrade when they are ready and still get a discount - effectively a trade-in value on their old version
- Let users who do not buy software assurance pay for "missed maintenance" for the period between upgrades rather than having to buy a brand new licence when they want to upgrade.
- Allow users to continue to buy premier support without having to buy Software Assurance (at present this requirement comes into force in October 2003)
- Lower the cost of Software Assurance from the current annual fee of 25% of the licence cost for server products and 29% of the licence cost for desktop products.
Some UK users have made contact with the Office of Fair Trading and the European Commission to see if either of these bodies can intervene to halt or amend the changes.
Potentially either user pressure or regulatory intervention could force Microsoft to backtrack. But if this does happen it is likely to be well after the looming deadlines. Users hoping for amendments to the changes still need to decide what to do in the short-term.
This was first published in September 2001