The Windows Observer--Microsoft Unveils New 'Select Plus' Volume Licensing Program

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Volume 6, Number 26 -- July 9, 2008

Microsoft Unveils New 'Select Plus' Volume Licensing Program

Published: July 9, 2008

by Alex Woodie

Microsoft last week unveiled a new volume licensing plan called Select Plus that it says will simplify licensing for customers with distributed operations. The new program carries most of the same obligations and license fees as existing volume programs, but will save customers money by giving them the maximum volume discounts for the company as a whole, and save them time through centralized purchasing.

In past years, Microsoft has run into criticism from some of its large customers, who say the software giant's multi-year Enterprise Agreement (EA) licensing programs are too complex and rigid, and that customers end up paying for more software than they actually use. Much of this criticism has centered around Software Assurance (SA), which is an insurance policy of sorts that customers who enter into multi-year contracts, such as the traditional Select License, can purchase as an add-on.

Microsoft says it's addressing some of these concerns with the new Select Plus maintenance agreement, which it unveiled last week, and which goes into effect this October.

In short, Select Plus allows large, geographically distributed organizations with decentralized purchasing departments to continue buying software as independent entities, but receive the volume discounts previously available only when a big organization bought lots of software through one of the multi-year licensing programs.

According to Microsoft's Joe Matz, its corporate vice president of worldwide licensing and pricing, Select Plus will simplify the software purchasing process for certain companies, and potentially save them money.

"At the highest level, Select Plus is a new volume licensing program designed for companies with multiple business units that have decentralized purchasing, but would like the advantages of centralized purchasing--advantages such as visibility into all the organization’s volume licenses, as well as discounts based on the true purchasing volume," Matz says in a PressPass Q&A posted to the Microsoft Web site.

Most of the licensing costs and minimum purchasing limits of Select Plus are the same as with the Select offering, with the exception of the length of the contract, which is three years with Select. With Select Plus, the limits are open-ended, allowing users to keep the same licensing agreement, or end it, as they see fit.

There are limitations to Select Plus. New customers must purchase a minimum of 500 points to get into Select Plus. Points are determined by the type and number of software product purchased; Microsoft assigns product points according to three product pools-- including applications, systems, and servers. Customers can also move into Select Plus from existing licensing programs, including Enterprise Agreement, Enterprise Subscription Agreement, Campus Agreement, and School Agreement.

SA is a potential sticking point for Select Plus. Select Plus customers have the option to buy SA, which would entitle them to new versions of Microsoft products, as they come out. Unfortunately, Select Plus requires customers to buy SA in three-year blocks, which maintains a vestigial level of inflexibility in the new program.