MS helps spread licence costs

Microsoft VARs could benefit from a guaranteed revenue stream over three years following the introduction of a new layer to the firm's licensing programme.

The scheme, known as Multi-Year Open (MYO), follows the controversial Licensing 6.0 scheme, which required users to get their licensing up to date by the end of July or buy full-price licences on their next upgrade.

Sue Page, group licensing manager at Microsoft, said: "Microsoft has given a lot of information to the channel about licensing recently, and this latest scheme gives partners another string to their bow."

MYO is designed to help SMEs spread the cost of licence payments and is open to firms looking to license five PCs or more. Software upgrades are also included in the agreement.

The scheme covers products such as Windows Professional Upgrade, Office Professional and various server products. Firms will have the option of keeping the software at the end of the contract or carrying on the agreement for an additional one or three years, thereby qualifying for further upgrades.

Tony Price, managing director of online reseller WStore, welcomed the scheme. "This gives resellers a constant revenue stream and simplifies the licensing process for businesses. It is a particular help to firms that can't afford to pay up-front for licences by spreading the cost over three years," he said.

At a partner briefing held in London last week, Steve Ballmer, chief executive of Microsoft, said he would have handled licensing differently if he had had "20/20 hindsight".

But he said Microsoft was still working on simplifying licensing for partners and customers.

Ballmer added that Microsoft sees the Linux platform as its number-one threat, despite bullish predictions about dot Net.

"Linux is a small phenomenon in the grand scheme of things," Ballmer said, adding that Microsoft offered the cheapest and best software. However, he admitted that it was difficult to compete with free software.

"We know we have to compete with things when they are small and not let them become a tidal wave," he said.

See next week's CRN for more details of Ballmer's visit to London.