Microsoft jacks up client license fees, but they may still be a good deal

Microsoft jacks up client license fees, but they may still be a good deal

Microsoft will make businesses pay 15% more for licenses that let workers access servers from as many devices as they want, which - depending on how workers do their jobs - may still be cheaper than the alternative.

The new fees go into effect Dec. 1, but existing support contracts that extend beyond that date will be honored at the old rate until the contracts expire. Meanwhile, IT execs should check out how their workforces actually use endpoint devices to access servers in order to sign up for the best deal, says Paul DeGroot, principal consultant at Pica Communications.

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He gives a pricing example for a single user with a corporate desktop who also accesses the Exchange server from outside the office, sometimes using a laptop and sometimes using a smartphone.

If the business supported that worker with CALs for each device it would cost $297. Supporting the same worker with a CAL that allows using unlimited devices costs $114 - and that's with the 15% increase, DeGroot says.

Sometimes, it's less expensive to buy a device license when it is used by many different workers to access the same servers. So a CAL for a workstation in a hospital that is used by multiple doctors and nurses during the day could cost less than licensing each individual who uses the machine.

Some businesses will use a mix of CALs, he says. DeGroot uses the example of a mining company where devices in field offices are used by many workers but workers at headquarters may each use multiple devices. In that case it might make sense to decide which type of CAL to buy based on location. "It may not perfectly reflect their requirements, but since CALs are fiendishly difficult to track - they don't actually exist, since they're not software - it may be easier to manage by location," DeGroot says in an email.

Customers have to specify whether they want user or device CALs and how many of each when they sign up for Software Assurance contracts, he says.

The 15% price hike might be explained by the proliferation of devices individuals use, he says. "This is a predictable response to the massive growth of multiple devices per user in the workplace," he says.

The hike is significant for Microsoft because the bulk of revenue from some server products comes from the CALs not the price of the server, according to DeGroot. "So, if Exchange is a billion-dollar business, which I'd guess is conservative, $800 million comes from CALs, and if half of those people switch to user CALs the revenue boost would be at least $60 million," he says.

These licenses apply to server CALs for Bing Maps, the Core Suite, the Enterprise Suite, Exchange Server (standard and enterprise), Lync Server (standard and enterprise), Project Server, SharePoint Server (standard and enterprise), System Center 2012 Client Management Suite, System Center Configuration Manager, System Center Endpoint Protection, Visual Studio TFS, Windows Multipoint Server, Windows Server and Windows Server RDS, RMS, Terminal Services, according to a blog by SoftCat, a Microsoft reseller.

(Tim Greene covers Microsoft for Network World and writes the Mostly Microsoft blog. Reach him at and follow him on Twitter!/Tim_Greene.)

Read more about software in Network World's Software section.

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Tags IT managementMicrosoftsoftwareit strategysoftware licensingMicrosoft client access licensesMicrosoft CALMicrosoft CAL increase


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