Jury Still Out on Provisions of Microsoft's Licensing 6.0

That's according to a recent joint survey conducted by Sunbelt Software, an ISV based in Clearwater, Fla., and

market-research firm Information Technology Intelligence.

Nearly 41 percent of survey respondents said they don't have the money for the annuity-based licensing, even as the July 31 deadline approaches.

Meanwhile, about 36 percent of 1,400 businesses polled said they will not upgrade to the Licensing 6.0 plan, and 38 percent are seeking alternatives to Microsoft products.

But several large Enterprise Software Agents (ESAs) responsible for handling pre- and post-sales servicing of licensing 5.0 contracts dispute that there's a big backlash,at least from enterprise corporate customers.

"We haven't seen that happen at all,not in a serious way," said Roger King, vice president of product services at Software Spectrum, an ESA in Garland, Texas. "There's still a large portion who don't want to do [Enterprise Agreements. They'll stay on Select. Select continues to grow for us as a business."

Another large ESA, Norwood, Mass.-based Corporate

Software, exceeded expectations for Enterprise Agreements during the first calendar quarter.

Some corporate customers may be dragging their feet a bit and Microsoft is giving them room to do so, but they will likely sign on to Licensing 6.0 by the July 31 deadline, said Mark Pearson, vice president of vendor relations and operations at the company.

"There's a holdback now based on deferring revenue. But I don't think they'll walk away from Enterprise Agreements," said Pearson.

Meanwhile, it's still unclear what the final adoption rate will be.

According to the recent survey, which polled a mix of small, midsize and large companies this month, while many respondents had serious license noncompliance problems, most won't adopt Licensing 6.0 because they don't have the funds to sign on and don't want to negotiate directly with the software giant.

"They still haven't cooled down," said Laura DiDio, president of Information Technology, referring to customers. An October 2001 survey by Sunbelt Software also revealed frustration with and resistance to Licensing 6.0.

"They don't understand the terms or conditions of version 6.0 any more than their existing contracts, and most of them abhor the subscription licensing scheme where they rent software instead of buying it," DiDio said.

Microsoft recently launched a special financing deal to encourage reluctant SMB customers toward Licensing 6.0. The company also is considering a plan that would allow SMB VARs to sell a repackaged portion of the Enterprise Agreement to small and midsize customers.