Posts

Microsoft: Pay More for the Same Old CALs

/in

 

Back in July, we blogged about how Microsoft’s new server pricing model, combined with the end of the Small Business Server package, would result in significant cost increases for many small businesses (see SBS End of Life: Microsoft Punishes Small Businesses).

Starting December 1, 2012, Microsoft is increasing the pricing for User CALs (client access licenses) across most of its product lines.   The higher CAL pricing does NOT include any new or additional functionality — just a higher price.

As most readers are aware, Microsoft offers two types of client access licenses.  Device CALs allow unlimited users to connect from a single physical device.  User CALs allow a single user to access servers and services from an unlimited number of devices.  According to Mary Jo Foley at ZDNet, “Microsoft has positioned User CALs as being the optimal choice if company employees need to have roaming access to the corporate network using multiple devices …”.  As such, most companies purchase User CALs.

Without adding any new features or capabilities, Microsoft is increasing the price of User CALs across all of the following products (in alphabetical order):

  • Bing Maps Server CAL
  • Core CAL Suite
  • Enterprise CAL Suite
  • Exchange Server Standard and Enterprise CALs
  • Lync Server Standard and Enterprise CALs
  • Project Server CAL
  • SharePoint Server Standard and Enterprise CALs
  • System Center 2012 Client Management Suite
  • System Center Configuration Manager
  • System Center Endpoint Protection
  • Visual Studio TFS CAL
  • Windows Multipoint Server CAL
  • Windows Server CAL
  • Windows Server RDS, RMS, Terminal Services CAL

When asked about these changes, Microsoft tells ZDNet, “These CAL changes include a user-based option that offers more value in support across unlimited devices …”

What Microsoft fails to mention, however, is that “These CAL changes” are not real changes at all — user CALs have always supported unlimited devices. The only “change” is the higher price.

For companies with Enterprise Agreements, Software Assurance, or other volume licensing agreements, the higher prices kick in at the end of your licensing term.  For everyone else, December 1st marks the day companies will need to pay more for the same old CALs.

SBS End of Life: Microsoft Punishes Small Businesses

/in

 

Don’t get me wrong.  Companies retire products all the time; New product road maps are a necessary and valuable part of the technology ecosystem.  How a vendor decides to retire a product, however, can be very telling with respect to how they view and treat their customers.  Let’s talk about Microsoft.

Last week, Microsoft announced it’s server options for MS Windows Server 2012, due out sometime later this year.  The announcement included three major components that, while they seem to be unrelated, both impact small and mid-size businesses.  With Windows Server 2012, Microsoft is:

  • Switching from per server to per CPU licensing.
  • Eliminating Small Business Server
  • Restricting which Server licenses can run on virtualized hardware.

In press interviews and its announcements, Microsoft is very clear that businesses running SBS must either now purchase separate Exchange and Sharepoint licenses or must move to the cloud (hopefully Office 365).   The impact, however,  is actually much greater for businesses with fewer than 75 users.

  • Companies with 25 or fewer users can get the new “Essentials” edition of Server 2012.  This version cannot, however, run in a virtual environment.  Small businesses cannot, therefore, buy one server and run Windows, Exchange, and Sharepoint servers virtually without licensing the more expensive Server 2012 Standard Edition.
  • The move to processor-based licensing will also push cost increases on small businesses.  Many SMBs have purchased quad processor boxes to deliver performance and support virtualization.  With a 2 processor limit on Server 2012 Standard Edition, many customers will need to double the number of paid Windows Server licenses.

Microsoft has made it clear that they expect SMBs to switch from SBS to a file server and run Exchange and Sharepoint in the cloud.  This option, too, will represent significant cost increases for SMBs given Microsoft’s pricing model for Office 365 and the need to upgrade specific Office 2010 versions for full functionality.

If this move seems coercive, it just may be.  As reported in PC World, Office 365 has not been the smash hit Microsoft predicted.  The company is not releasing sales or usage numbers.  As a Microsoft spokewoman quoted in the article stated:

“We’re not breaking out customer, user, or revenue numbers at this time”

And according to IDC Analyst Melissa Webster, “They’ll give metrics when the metrics are meaningful, demonstrating scale and depth.”

So with lackluster performance, Microsoft releases a licensing and pricing model that “encourages” SMBs to move into the cloud or pay a heavy hardware and licensing penalty for upgrading in-house systems.

Fortunately, small and mid-size businesses have alternatives.  Google Apps for Business and other services offer more cost effective solutions for email, communication, and collaboration than Office 365. Beyond moving the Exchange and Sharepoint components of SBS to Google Apps, businesses can deploy secure cloud-based file services with full drive letter mapping and network place integration; access from PCs, MACs, and mobile devices; and integrated security and backup/recovery services.