Reality Check: Right time to bargain with MS

27.06.2006
I think it's a wonderful thing that Bill Gates is retiring so that he can devote himself to his foundation. (http://gatesfoundation.org/) If he puts half the effort into doing good works that he put into building Microsoft, the world will benefit. However, that doesn't mean your company has to continue funding his efforts by overpaying for Microsoft license agreements.

A Gartner report issued on June 5, "Five Leverage Points to Use When Negotiating with Microsoft," focuses on the Microsoft EA (Enterprise Agreement). EA is a subscription model (aka revenue stream) for Microsoft, in which companies sign on for what is usually a three-year period. During that time they receive certain guarantees, but as it turns out, they may be paying for more than they need.

Software Assurance is a big part of an EA. It guarantees that you will always have the latest version of Windows and Office. But the amount of time between versions is growing longer. Consider: The last release of Windows was six years ago. If you have an EA from five years ago and have renewed it twice, you may have paid for that entitlement three times over. Other companies opt for an EA but still upgrade desktops at the department level, which means the company ends up paying a second time for the Windows and Office licenses.

The second EA entitlement is the Core Client Access License. It bundles client access licenses to Windows Server, Exchange Server, SharePoint Server, and System Management Server for a single, low, low price, so to speak. But what if your company uses Lotus Domino? A company that uses fewer than all four Microsoft servers is paying for client access it will never use. If you take the à la carte Select Agreement approach, in which your company owns the software and there is no assurance, you can save a great deal of money.

The third big-ticket item in the EA is Microsoft Office Professional Edition. The difference in price between it and Standard edition is about 25 percent, but the difference in features is negligible.

There are many currents in the industry that can offer ways to reduce the cost of and support for client PCs. Smarter companies are recasting their desktop purchasing strategy by segmenting their users. They know one size does not fit all -- so why pay for it?