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Microsoft miffs customers
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September 25, 2001: 7:14 a.m. ET
Companies say new software licensing plan will strain technology budgets
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NEW YORK (CNNfn) - Some companies are complaining that Microsoft Corp.'s new software licensing plan, set to begin next week, will increase costs, further straining technology budgets, a published report said Tuesday.
However, Microsoft (MSFT: Research, Estimates) counters that prices will remain the same or lower under the new plan, first announced in May, the Wall Street Journal reported.
The plan encourages customers to subscribe to a new software maintenance program under which they would receive automatic upgrades of programs such as Windows and Office. That means no more discounts to companies who now buy upgrades in bulk.
As a result, Microsoft programs will cost more -- 30 percent to 100 percent more, according to some market researchers. Companies have until Feb. 28 to sign up for the new maintenance plan, called "Software Assurance," otherwise they must buy more expensive licenses when they are ready to upgrade, the Journal said.
A group of British companies has complained to the British secretary of state for trade and industry that Redmond, Wash.-based Microsoft's plan would raise their firms' technology costs an average of 94 percent.
Additionally, the 4,000-member Dutch Network Users Association said 86 percent of its members face price increases.
Microsoft President Bill Landefeld said the British group's estimates are based only on one product, and said the company was unlikely to alter the licensing plan before next week.
"We're certainly familiar with (the groups') positioning and we continue to be engaged with them," Landefeld told the Journal.
Microsoft shares rose $2.30 to $52.01 Monday 
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