Microsoft Windows Server Price Increase? Check Your Sources!

It has come to my attention that one of the large resellers is telling their US clients that Microsoft will be doing a 15% price increase on Microsoft Windows Server products effective January 1, 2012. The information I've received is that this is not accurate, that it does not apply to the US (Latin America may want to check into it though). 

However; I'm not a reseller and I'm not Microsoft so I don't have access to price lists. So, the point of my story? Check your sources! If one of your resellers is giving you this advice, please check it out with another reliable reseller and with your Microsoft account team. 

 Additionally, if your reseller does give you this type of wrong advice...might be time to re-evaluate resellers. Yes, everyone can make mistakes - but I'll tell you frankly, this reseller has been on my list of "least desirables" for a long time due to some of their practices and this just put a nail in their coffin for me. 

Happy Holidays - and here's hoping that January doesn't bring a price increase on Microsoft Server products!

Resellers and Publishers in the world of Software License Management

I woke up this morning to a great Twitter from a good friend and great coach Jak Plihal (http://www.beingsolutions.com/). It was the quote:

"It is hard to get a man to understand something, if his living depends on him not understanding it." by Upton Sinclair.

To me, this perfectly explains the relationship between resellers (VARs, LARs, and any other acronym that is responsible for selling you software), software publishers and the details of software licensing.

There are details in software licensing agreements and product use rights that can be turned to a benefit for a company in legally reducing their software licensing costs...but you're not going to find them all out by asking your reseller or publisher for help.

Why? Not because they are necessarily trying to mislead you or keep you in ignorance - instead it's because they honestly don't even think of those options...because their living (or magnitude of it) depends on them not thinking of those options.

Now, there are definitely some that are better than others (I love working with Softmart for example as their reps have demonstrated to me a strong ability to keep the customer's needs in focus) but as long as their income relies upon what you buy then Upton Sinclair's quote will continue to apply.

When it comes to negotiating the best deal for licensing - the bulk of the savings opportunities comes from making full use of the product use rights and volume licensing agreements terms - not from the discount you negotiate (or not from the discount you negotiate without knowing these items intimately). Get your advice and education from an independent expert...know in advance who profits from your purchase and what their motivation is so you can better analyze their advice.

Remember, "It is hard to get a man to understand something, if his living depends on him not understanding it." Upton Sinclair.

Thanks Jak!

Software Licensing - 2010

Wow, can't say I'm upset to see the end of 2009! Having been in business since 1999 I've seen some ups and downs (think California, technology, early 2000's...ouch!) and am happy that with business maturity comes a certain tolerance to economy and business shifts...but I'm ready for this year to be over!

What's in store for licensing in 2010? I think we will continue to see a lot of acquisitions occur this year - which means eventual changes to volume licensing agreements. Be sure to keep an eye on mergers, acquisitions and divestitures to see which of your software licenses are impacted. It typically takes at least a year for any changes to volume licensing agreements but it might have a big impact on your maintenance decisions.

For Microsoft users there will be several new releases this year in Office, SharePoint and SQL Server to name a few. SQL Server is also being purported to have a couple of new editions and changes to some of the licensing terms (in particular SQL Enterprise and SQL Datacenter edition). Be sure to keep a close eye on these, especially if you have a virtualized model.

SaaS will continue to feel it's way and don't be surprised to hear more about the Microsoft Enterprise Subscription agreement...an agreement that has long existed but (in my opinion...as is all of this blog) wasn't priced well for most businesses.

Also, for those renewing Microsoft agreements there are some changes to your terms and conditions that you might not be aware of...the loss of the 30 day "grace" period on renewing of Software Assurance and an increase to 90 days for notice of change of reseller (hint, this determines who gets paid for your purchases and impacts any incentives resellers will offer to you - be sure to handle this on a timely basis if changing. You don't want the reseller you're "firing" to get paid for the renewal you do next month.)

What do you expect to see happen with software in 2010? Any licensing trends you know are happening or changes to PURs?

Ways to Cut Costs - Software Licensing

It's funny - when times are lush, companies feel they don't have the time to put in a SAM program...when times are tight, companies feel they don't have the money to put in a SAM program.

Unfortunately, it's a Catch 22...if you had a SAM program, your staff would have more time because they would be more efficient and you'd have more money because you wouldn't be wasting it on higher maintenance fees and over priced products.

Sorry, I'm on my soapbox and I know it. Just remember, it doesn't take as much time or as much money as you think it does and the benefits far outweigh the costs.

Two recent items have come up that impact the costs of software licensing:

1) Microsoft Financing - they've just changed the rules.
2) Webinar Series "Cutting Costs - Software Negotiation"

Microsoft Financing (for those of you who didn't know it, Microsoft will finance your deals that involve purchases of Microsoft software as well as hardware and other services) has changed the rules a bit. It used to be that you didn't have to buy much software to finance your whole deal...apparently they are now going to require that at least 35% of the deal be for Microsoft software. Read the details for Scott Bekker's blog.

Webinar Series on cutting costs through software negotiations. For 10 years we've been helping our clients cut their costs (after they've already internally negotiated the deals). We're now offering a webinar to help teach you some of our techniques. This series isn't about contract law, it's about understanding the insides of the deal and turning it into cash and benefits for your company.

So, I know many of you are trying not to spend money right now on software...don't forget - those annual maintenance agreements you're paying is still spending money and many of them can still be renegotiated to lower your costs!

Software Licensing - What You Don't Know Can Cost You!

I was having a conversation with a gentleman on Friday night at a business mixer and discovered that he was an IT infrastructure consultant advising a fairly large size enterprise on a new structure to support their very distributed user-base.

During the conversation he mentioned his surprise at the amount of money it was going to cost his client to implement Microsoft Office 2007 for their 7500 users. We talked a little more as I wanted to understand what program the company was considering purchasing through - and I found out that they had formerly had Software Assurance but it had expired almost 2 years ago. What this consultant didn't know (and neither did his client and no one else was bothering to point it out) is that Office 2007 was released to the general public on 1/27/2007 and (don't quote me on this date) was available to their volume licensing customers around October 2006. Software Assurance entitles you to the latest version of the software released as of your expiration date - whether you've installed it or not. That is in perpetuity (for traditional licensing).

The result being, that was $2m the client was going to spend for software they were already licensed for! I told the consultant to go back to the client and have them review their licensing statement of the Microsoft Volume Licensing web site to make sure dates were good but that it looked like that was money they could keep in the bank (and to hire us in to review the rest of their licensing plans to avoid any other costly mistakes).

This is an area where we frequently find clients uninformed or misinformed. Talk to an unbiased licensing professional before making a software investment - what you don't know can cost you a lot of money!

Here We Go Again...

Let's take a walk down memory lane....the year is 1994 and a mid-size national firm (1,200 PC's) has a new software manager who realizes that the firm needs to be buying their software on a volume license, so she starts down the path of finding out everything she needs to know to make this happen.

Since there's no one she can find who can educate her on this, she turns to her reseller...who invests a lot of time and energy into educating her. Finally, time comes to seal the deal and another reseller walks in the door and tells her a few more things that the first reseller didn't tell her....things that would have a strong impact on the financial viability of the purchase.

Time passes, this software manager continues to learn and comes to realize that there were even more things she should have been told that neither reseller told her...that money was lost on the deal because she hadn't known them when the deal was made. Unfortunately, there hadn't been anyone to advise her that didn't have a vested interest in the deal.

Fast forward to 2008, that software manager (and yes...that was me) would no longer have to rely on the advice of a reseller...there are instead a number of small Software Asset Management (SAM) consulting firms that would appropriately advise her on all important aspects of the deal - helping her make the right choice and the best deal for her business.

However; we have to be careful that this valuable source of independent information remains available to consumers.

Most major resellers are now starting up SAM consulting businesses in response to publisher requirements. Here's the problem with that...since consulting isn't the primary business line a reseller can price their consulting services at a price that an independent firm can't compete with...and the next thing you know, the only source of information for you on that major purchase is someone who has a vested interest in the outcome...

Are we coming full circle? I hope not - the reason I started my firm in 1999 was because I saw a need for companies to have someone on their side of the deal....whether it's me or another small SAM firm, I don't want companies to lose that independent perspective.

What are your thoughts?