Ten years ago Microsoft unveiled their Software Assurance program to their customers. Software Assurance is a three year contract commitment with a yearly fee of 29 percent of the full license price for desktop software products and 25 percent for server software products. This program introduced a radical change in migrating from one release to the next. Prior to Software Assurance, the migration between releases could be purchased at a discount price, if the previous license was owned by the enterprise. Software Assurance provides access to new releases during the period covered by the contract. This upgrade model sounds reasonable, but has lead to controversy and complaints from Microsoft customers.
The Bad—Software Assurance has often been considered as a bet to get a discount. The rate is 29 percent per year, 87 percent over three years. If new releases of the software products covered by the maintenance agreement become available during the term of the contract, then customers can migrate their existing applications to the newer versions (e.g. Office 2007 to Office 2010) and get a 13 percent discount on new license purchases. If no releases are issued then the benefits of the contract are highly questionable. To overcome this issue, Microsoft is trying to issue new releases at least every three years for most products. However there have been gaps in the past, for instance with the delayed release of SQL Server 2005. Every delay of a software release from Microsoft worries Software Assurance customers. The price for Software Assurance, 25 to 29 percent, is quite high compared to industry standards. Most publishers provide support and maintenance, including access to new releases, for 18 to 22 percent of the license price.
The Good—A customer’s commitment to Software Assurance for three years enables enterprises to spread out their payments for upgrades and better predict their budget. There are multiple additional benefits that come with Software Assurance: home use rights enabling employees to install and use copies of the software on a home computer at low cost (around $US 10); roaming use right enable end users to access Office, Project and Visio outside the work environment such as on home PCs or internet kiosks; training vouchers for technical staff and access to online web based e-Learning training for end users; access to Microsoft phone and web support; planning services days to help the company with desktop, SharePoint, Exchange deployments or Business Value Planning Services to maximize the value of Microsoft Office suite.
Software Assurance is not very appealing if a company does not plan to migrate Microsoft products to newer versions within a three year timeframe. If migration is planned or envisioned, Software Assurance must be considered as a package, not as a single benefit allowing enterprises to access new product releases. A migration does not consist solely in physically replacing the software products. Migrations consist of multiple phases including:
- A technical analysis must be performed
- A plan has to be created
- End users must be trained on the new release
- Access to support (including evaluation licenses)
From this perspective, Software Assurance is a great offer that will provide high value to enterprises.
Software Assurance has a huge impact on license compliance and license optimization by providing these upgrade rights. Upgrade rights are set according to the duration of the Software Assurance contract and kept up-to-date during contract extensions or renewals. When new releases become available from Microsoft during the period covered by the upgrade right, all corresponding existing licenses should be automatically updated to reflect the new entitlement. This is hard to manually track even for small software estates; software asset and license management tools are really required to take advantage of these entitlements.