May 10, 2001, 2:38 PM — Microsoft Corp. today announced major changes to its volume software licensing programs, including the planned addition of a subscription-based license scheme under which corporate users would pay to install packages for a fixed period of time instead of buying perpetual licenses.
The subscription plan, which Microsoft described as an option for users, is scheduled to go into effect Oct. 1 along with the other changes that the software vendor detailed today. The changes include a reduction in the number of PCs that companies need to qualify for enterprise licensing deals from 500 to 250, as well as a reduction in the number of different software upgrade options that are now offered to users.
Bill Henningsgaard, vice president of worldwide licensing and pricing at Microsoft, said in a question and answer session posted on the company's Web site that the upcoming changes should reduce costs for about 30% of its volume licensing customers and have no impact on what half of its enterprise user base pays for software and upgrades.
But the remaining 20% "may pay somewhat more than [they do] today because they upgrade less frequently than the average [user]," Henningsgaard said. Users who find themselves in that category will be able to continue buying standard licenses for new software releases, or they can switch to the new streamlined upgrade program, he added.
Henningsgaard described the subscription licensing scheme as a "rental" approach, under which users would pay for software "in much the same way that many now lease computer hardware." Companies would sign three-year deals for individual products or a suite of Microsoft packages and then pay annual subscription fees based on how many PCs they have, he said.