We have addressed how the per-device licensing model that Microsoft currently utilizes is slowing the adoption of virtualization, making it too expensive. But… guess what? Later this year, Microsoft is finally going to make some changes!
Some of the complaints from the industry have been about the required purchase of SA in order to access virtual desktop tools, and that Virtual Enterprise Centralized Desktop (VECD), which is required, is too expensive.
While Microsoft is well aware of these issues that have only just come forward to say that the intent to create a “hybrid” licensing model between per-user and per-device licensing. The software company claims that it cannot accurately get a count of licenses per access point using any alternate licensing model, which currently exists; so Microsoft will have its work cut out for them when trying to come up with a new model.
We predict that Microsoft will introduce small changes, gradually, to accommodate the most immediate problems with virtualization, until the company can develop a model that works for everyone involved.
Retailers are a unique breed when it comes to licensing. We recently worked with a number of retailers seeking to understand their Oracle licensing and they all had a mix of Named User Plus licensing and CPU licensing. With Oracle or any enterprise software for that matter, licensing is about access and authority, but not necessarily limited to people. The latter being an extremely important point to software licensing, usage and retailers.
One of the major differences in the retail industry is the equipment that houses the software application - from point of sales equipment such as registers and scanners to backroom inventory systems. These systems need to be considered as part of the licensing mix and, more often than not (in our experience), the IT executives at retailers overlook them.
So, if you’re a retailer, you may want to take another look at your Oracle licensing inventory.
In December, some of you may have noticed, that Microsoft revamped its volume licensing site in order to have one system for both business users and software partners. The company has gotten many, many complaints about email verification. Microsoft issued an apology on its website, but if you read through the string of comments, you will see that many are still facing problems and the glitch in the system has not been fixed, as promised.
According to a Microsoft spokesperson, the website is meant to improve and simplify license management, but so far, that hasn’t come to fruition. Many of the complaints have been about the security verification - turns out if you don’t have a valid business address, you weren’t getting through.
Today, mergers and acquisitions are as common as marriages or people setting up households together, and may present unfounded opportunities for lowering your Oracle support stream and uncovering more favorable terms and conditions.
Reinstating terminated support. When a company takes on an acquisition or makes a divestiture, the hard assets - furniture, equipment, electronics, etc. - are easily categorized or sold off, but it’s easy to overlook “soft” assets such as software, licensing and support. In both scenarios (M&A or divestiture), you likely have access and/or rights to reinstate a more favorable prior support stream, creating a more advantageous environment including pricing. Please note: Terminated licenses cannot be reinstated as we accidentally and incorrectly mentioned in this morning’s newsletter.
Don’t forget about support renewals. Many of your older software vendor contracts probably have some sweet Terms & Conditions that you don’t want to lose. Remember that you are responsible for the annual support renewals (and not your Oracle rep). Every time you allow a renewal to lapse, you lose those advantageous T&Cs and licensing goes up between 15 to 25%.
The name of the game with any software licensing agreement is to get the best deal, but most executives equate this to discount. And, while we love discount, you always have to look at the longer term pitfalls or benefits. Much of the time, a sales rep offering you a discount – say 20% - on a large enterprise agreement negotiation, it sounds great. But, when you look at how software licensing works, the changing dynamics and business goals of a company and the upcoming changes (and, boy, are there a lot of those at companies today), that 20% discount may save you in the short-term, but in the longer term, you’ll end up spending more because you haven’t planned for the long game and there is little or no flexibility in your software license agreement (SLA).
So, what should “getting the best deal” from your software vendor mean? Yes, sometimes it does mean getting the best price. That’s definitelya factor, but you also have to look at:
Flexibility and scalability
Ensuring best Terms & Conditions (this is probably the most important factor)
Lowering your annual costs (e.g. support and maintenance) – which means you have to look at proactively managing the initial purchase carefully otherwise you end up with an ongoing annual payment for licenses you don’t need or use
Correctly match the appropriate licensing scenario to each organization (with Oracle, there are too many factors that could increase or decrease cost)
If you pay attention to all of the above, you will get the best deal – from best pricing to best value.
Do you want or need Microsoft’s Software Assurance? A couple of basics of why or why not, and how an external party can help. Less than 15 seconds of a very unpainful “sell”, but some basic and very useful information about when Software Assurance is needed.
