Report: Companies Questioning Microsoft's Software Assurance Program

In a report published Monday, Forrester said that uncertainty over the timetable for Microsoft software releases, and the headaches involved with upgrading to new software versions, has many organizations wondering if Software Assurance is worth the expense.

Most firms buy Software Assurance for the ability to upgrade to new releases. However, as the time between new releases has stretched longer and longer, this aspect of SA isn't providing the same ROI as it used to, Forrester said.

Annual Software Assurance costs are 29% of the license for desktop products and 25% of the license for server products, making Microsoft's offering one of the most costly in the IT industry, according to Forrester. Microsoft has been trying to add value to Software Assurance to entice organizations to upgrade.

The Redmond, Wash software giant Monday rolled out Windows Partner Solutions, a package of its Desktop Optimization Pack, as a subscription offering for Software Assurance maintenance contract customers that includes technologies from several recent Microsoft acquisitions.

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DOP includes application virtualization software from Softricity, inventory services from AssetMetrix, group policy management software from DesktopStandard, and recovery software from Winternals.

Still, the lack of a product road map for Windows Vista, Office 2007, SharePoint 2007, and Exchange 2007 has caused many organizations to think twice about renewing their SA contracts, Forrester noted.

"This uncertainty regarding product releases makes it difficult for IT procurement and sourcing professionals to justify a three-year SA renewal," Forrester said.

Making matters worse is the fact that Microsoft hasn't always adhered to the four-year product release cycle to which Software Assurance is pegged, Forrester said.

Microsoft's introduction of so-called Enterprise Client Access Licenses has also eroded many organizations' confidence in Software Assurance. For products like Exchange and SharePoint, Microsoft is telling its customers they need to buy an additional CAL to go with the one they've already purchased as part of SA, according to Forrester.

Forrester also expects Microsoft will seek to keep SA relevant by tying it to other offerings, noting that it has already begun doing this with Windows Vista Enterprise edition. "Sourcing pros should make sure to understand the consequences and risks associated with SA before making any final decisions," Forrester concluded.