The Observer: Microsoft's Slap In The Face - InformationWeek
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11:53 AM
Lou Bertin
Lou Bertin

The Observer: Microsoft's Slap In The Face

Lou Bertin isn't too keen on Microsoft's Software Assurance. In his view, Microsoft has told its corporate customers that they'd better buy software upgrades now (economic conditions be damned), or face being shut out of the program. And, by the way, get ready to pony up in the future.

Comfort is a rare commodity these days. With the world unimaginably changed, there's enormous solace in the familiar--the bits of evidence, great and small, that indicate life does go on.

I was oddly comforted by reports last week that one great constant marches on: Microsoft's abiding belief that it knows best what's good for its customers. I refer specifically to Microsoft's soon-to-be notorious Software Assurance program, which took effect Oct. 1.

According to Microsoft, the program was designed to simplify upgrades. That's a worthy goal. But the Software Assurance program's maintenance agreements essentially determine which upgrades customers will purchase and when, without regard to whether customers want or need those upgrades.

Deciding For You
The Software Assurance program was announced in May to coincide with this month's release of Windows XP. One provision is that only users with current software versions (such as MS Office) would be eligible for the assistance provided by the Software Assurance program.

To make matters even simpler for consumers, the maintenance program terms also determine your upgrade timetable. If you sign a three-year Software Assurance maintenance agreement, you've also signed on for complete upgrades for all covered devices within three years.

There, now. Isn't that easier than going to the trouble of deciding when you might want to upgrade; of deciding which upgrades make strategic sense for your company; of determining which of your individual users need upgrades and which don't?

In essence, Microsoft has told its corporate customers that they'd better buy those upgrades now (economic conditions be damned), or face being shut out of the Software Assurance program. And, by the way, get ready to pony up in the future.

The net result of all this? Per a Gartner report, a typical company with 5,000 PCs that now upgrades Microsoft Office every four years will wind up paying between $900,000 and $1.7 million more under the new scheme than it would have had the company opted to upgrade at its own pace.

But think of the convenience that results from having all those decisions removed from your plate!

The best characterization of all this that I've come across came from David Roberts, chief executive of the U.K.-based Infrastructure Forum, who called the Software Assurance program "a slap in the face of every Microsoft customer. For our members and virtually all U.K. businesses, there are no immediate alternatives to using Microsoft software, and [Microsoft] knows this."

The Infrastructure Forum--whose members include GlaxoSmithKline, Prudential, and Cadbury--has filed a formal complaint with the British government, claiming the upgrade program will cost its members upwards of $1.3 billion.

Depressingly, this is but the latest "consumer convenience" Microsoft has foisted upon its customers. First came the start-up screen, then the browser--and now this. In the name of consumer convenience, Microsoft yet again provides evidence that it apparently is constitutionally incapable of making a decision that doesn't back its customers into a corner.

That all of this is timed to coincide with first shipments of XP is perfectly understandable. Yet, it smacks of naked customer manipulation by Microsoft on the one hand and of blatant cash grab on the other. From Microsoft's perspective, if XP doesn't provide the revenue bounce the company expects, it's got Software Assurance revenue to cushion things. If XP takes off quickly, even better.

The business model that calls for providing customers their choice of Scylla and Charibdis lives on, notwithstanding those nettlesome noises coming from U.S. judges.

Yes, it's comforting to know that some things endure, even in a changed world. Sometimes, though, I wonder if we might not be better off with a little less comfort.

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