Microsoft as of today will no longer issue concurrent application licenses

Finishing a strategy it started more than two years ago, Microsoft (MSFT) as of today will no longer issue concurrent application licenses, claiming that customers simply do not want such licenses any more. But since Microsoft Office 2010 said last month it would end concurrent licenses, Office users have given the decision a mixed reception.

Concurrent licenses allow organizations to run an application--in this case, Microsoft's Office productivity suite--from a central server and pay for a fixed number of simultaneous users. For example, if the IS manager of a 10,000-person company figures that only 1,000 people will be using Download Office 2010 at any one time, she can buy a 1,000-seat license. To regulate usage, a company also must invest in software that monitors the number of users.

One user at a public university was dismayed with Microsoft's decree.
"I am hoping Microsoft will reverse this decision," wrote Charles Cottle, director of user training and support services for the University of Wisconsin at Whitewater's information services division, in an email message.

Cottle, also a professor of political science, will oversee about 4,000 desktop machines by next fall. He wanted to make Office available to the entire UWW campus through concurrent usage, citing the expense of buying a desktop license for 4,000 desktops.

"If we were to begin with 10 percent of the desktops for concurrent licensing [of Office 97], i.e., 400 licenses, the cost would be $36,000," Cottle wrote. "If, on the other hand, we have to license [per] desktop, the cost is $360,000. For us that's the operational definition of 'prohibitive.'"

However, with the advent of ever-larger and cheaper hard drive space and the complexity of managing network traffic, concurrent usage for many companies is no longer viable.

"We've tried it both ways, and we've found the desktop environment is much better for us than the networked environment," said Robert Galvin, corporate director of information services at Circus Circus Enterprises, which has between 700 and 1,000 Office users.

Circus Circus switched from concurrent usage more than two years ago because it was too difficult to manage in a constantly shifting IS environment.

"The casino environment is not a normal 9-to-5 business environment," Galvin said. "Everything's changing constantly. With this much turnover, [concurrent usage] would cost me a fortune."

Customers such as Galvin would support Microsoft's claim that concurrency is too complicated. But others feel Microsoft's bid to end concurrency is a way to cut its own costs. Two years ago, Microsoft doubled the price of concurrent usage and added extra features, such as the ability to download the applications to the hard drive. But the company also forbade customers from "floating" usage across different time zones. For example, a company with an Office 2010 in London could use the same 100-user license and shift the workload to the California office when the London staff went home, resulting in big savings.