Microsoft to debut midmarket bundle, licensing

Microsoft Corp. is expected to unwrap a Windows software and licensing promotion aimed at making it easier for midmarket companies to implement basic Microsoft infrastructure software, according to a Microsoft executive.

The new software bundle, called the Windows Server System Offer for Midsized Companies, will debut at the Microsoft Worldwide Partner Conference 2005, which will be held in Minneapolis over the weekend.

Also at the show, Microsoft plans to unveil a new version of its Open License Program aimed at midmarket customers, said John Lauer, vice president of midmarket in the small, midmarket and partner solutions business at Microsoft.

Lauer said he would not go into further detail until the conference about the changes, but said they would “resonate” with customers in this space, which Microsoft defines as those with between 50 and 1,000 employees.

Steven Van Roekel, Microsoft’s director of midmarket solutions for Windows Server, acknowledged that Microsoft’s software licensing leaves midmarket customers “in the vortex” where they end up paying more than enterprise customers and small business customers for the Microsoft infrastructure they need to run their businesses.

“What tends to happen with the midmarket is [the companies] aren’t large enough to take advantage of the preferential enterprise pricing, but they can’t take advantage of small business pricing,” he said. Promotions like the new Windows Server System Offer are designed to alleviate some of those licensing woes, Van Roekel said.

The new promotion runs for a year and includes three copies of Windows Server 2003 Standard Edition, one copy of Exchange Server 2003 Standard Edition, one copy of Microsoft Operations Manager (MOM) 2005 Workgroup Edition, and 50 client access licenses (CALs) each for Windows Server and Exchange Server, Van Roekel said. The bundle is priced at about US$6,400, a 20 percent discount from Microsoft’s standard Open License Program pricing of $7,700, he said.

Customers also can purchase more combined CALs for Windows and Exchange for about $76 each during the promotion, which is also 20 percent off the regular price of $95, Van Roekel said.

Companies must have a CAL for each user that is connected to the servers. The maximum number of CALs a company can purchase through the promotion is 250, he added.

Microsoft has three main software licensing programs: Open, Select and Enterprise Agreement, Lauer said. Enterprise Agreements are targeted at high-end customers with the largest volume requirements; Select licenses allow customers with 250 or more PCs to customize their software purchases with lower volume requirements than the Enterprise level; and Open licenses offer customers with five or more PCs the lowest number of licensing requirements, along with volume discounts.

Microsoft said that customers and partners have been requesting a new Windows Server System SKU for midmarket customers because the licensing for Microsoft’s Small Business Server (SBS) leaves a lot of them out, as it limits the number of computers connected to it to 75, Van Roekel said.

Ric Opal, vice president of Microsoft partner Peters & Associates, an Elmhurst, Illinois-based consulting firm, said the promotion is a “simpler purchase” for the midmarket, and will also save Microsoft partners time when negotiating deals with these customers.

With the new promotion, “I don’t have to have sales people focused on versioning and number of clients and that sort of thing,” he said. “I don’t have to navigate through different licensing offerings if I can set them up with this midmarket offer.”

Peters & Associates does about 80 percent of its business in the midmarket, Opal added.

Lauer said the midmarket has been a growth area for Microsoft over the past year, and the vendor is planning more initiatives to help customers in that space more easily purchase Microsoft products, either from the vendor or its partners. “Microsoft is super-focused on this,” he said.

To help customers and partners implement the promotional software system, Microsoft will launch a new technical Web site at the partner conference that will provide information for customers and partners specific guidelines and information to set up the software for midmarket customers, Van Roekel said.

The new site goes live Thursday and can be found here.

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