Microsoft On Track To Open Launch Open Value

Microsoft is on schedule to launch its Open Value licensing program for small and midsize businesses on March 1 and is mulling other Licensing 6.0 concessions, said sources familiar with the vendor's plans.

Open Value, the successor to the existing Open Business program, is a new Licensing 6.0 option that, for the first time, enables small and midsize customers to buy enterpriselike, companywide software agreements and spread out their annuity payments over a three-year period.

ARRESTED DEVELOPMENT Delays have changed landscape of Microsoft's Licensing 6.0 >> May 2001: Licensing 6.0 and Software Assurance unveiled. >> Oct. 1, 2001: First deadline delayed because of terrorist attacks. >> Feb. 28, 2002: Second deadline delayed because of economy. >> July 31, 2002: Third and final deadline enforced. >> September 2002: Microsoft rescinds planned restriction of Windows Server 2003 Standard Edition to one processor. >> December 2002: Two options offered to license Windows Server 2003,per user or per server. >> March 1, 2003: Planned launch date of Open Value, a new Enterprise Agreement-like policy for small and midsize customers.

The Open Value plan enables companies with as few as five seats to buy in and has no fixed ceiling, thereby offering some midsize customers one last chance to sign up for license agreements. Many midsize companies that did not sign up for Upgrade Advantage/Software Assurance by the July 31, 2002, Licensing 6.0 and Software Assurance deadline and lost their rights to discounts may now be eligible for Open Value, the sources said.

Sources also said Microsoft gave Open Value the green light after the deadline came and went with disappointing adoption from the small- and midsize-business markets.

"Open Value seems, on the surface, to be a pretty good deal, especially for small businesses," said Michael Cocanower, president of ITSynergy, Phoenix. "I think there is significant pent-up demand for software and hardware upgrades, and this may help to push people over the edge toward a purchase."

As part of Open Value, solution providers become technology influencers and reap commissions of between 8 percent and 11 percent for influencing a buy, while leading distributors become aggregators that execute the licenses.

According to Ingram Micro,one of a handful of distributors and OEMs assigned to serve as authorized Open Value license providers,the end-user cost of Open Value for the first year is one-third of that of Open Business because of customers' ability to spread out payments.

Microsoft is also considering adding some level of free technical support with Software Assurance for those customers that signed up for Select 5.0 and Software Assurance by last summer's deadline and are up for renewal in mid-2004, the sources said.

However, Microsoft does not plan to cannibalize its lucrative Premium support program and will instead offer basic support services, sources said. "Microsoft is looking for ways to increase the value proposition of Software Assurance, and changing tech support policies is a possibility," said one channel source who asked not to be identified.