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Microsoft licence deadline approaches
You might not like it, but you've got to do it...

By Joey Gardiner

Published: Tuesday 21 May 2002

IT directors are being urged to sign up to the new Microsoft licences before the 31 July deadline.

The changes to Microsoft's licensing policies were announced last year, but were delayed twice because of customer resistance.

But this time, the software behemoth is pushing ahead regardless.

Analysts are now joining with Microsoft in urging customers to take up the new licences, or face crippling upgrade charges in the future.

Sue Page, group manager of relationship marketing for Microsoft UK, told silicon.com that companies were only just beginning to wake up to the deadline.

She said: "People need to be aware there is a limited amount of time to do this, and that some options will disappear.

"This shouldn't be shied away from because of the cost issue, because in many cases it will cost firms much more at a later date."

Page admitted customers had been irate and confused about the changes but insisted they represented good value for businesses. She said some firms are now starting to get the message, with a 25 per cent increase in sign-ups within the last couple of weeks.

However, Microsoft will not say how many customers have signed on the dotted line and estimates as to the rate of take-up of the new licences vary widely.

Gartner Group said last week up to two-thirds of companies were yet to sign up. It is now urging companies to evaluate their Microsoft licensing arrangements and renegotiate them as a matter of urgency.

However, Giga Information Group puts the figure much lower, with just 20 per cent having failed to take up the new licences.

Thomas Mendel, director of research for the analyst house, thinks even this lower figure represents a big problem: "This means one in five IT directors will be getting into big trouble with unsupported environments. In most cases we don't think this means they've opted for an alternative - they seem to have just forgotten about the deadline."

Mendel blames a "disconnect" between the IT and purchasing departments for the problem.

Microsoft's new licences mean companies which sign up will be eligible for free upgrades over the next three years. Those who don't risk having to pay a full licence fee again if they want to upgrade.

Microsoft has already announced its intention to stop supporting pre-Windows 2000 environments over the next couple of years, leaving companies that opt out in danger of being left with obsolete equipment.

Microsoft's Page urged customers with queries to contact their reseller or ring the Microsoft customer support helpline.

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For related news, see:
Microsoft users unclear over pricing strategy