* Considering licensing plans for Blackcomb
In the last issue I talked about the upcoming “release” of the next version of Windows server software, codenamed “Blackcomb.” It appears there won’t be a single release as we’ve come to know it but a series of updates and upgrades to Windows Server 2003 that will come out over the next three to five years. Currently, though, there’s no announced revenue plan for these additions and improvements. Changes, updates and fixes for Windows 2000, for example, have been available for no charge to anyone wishing to download and install them.
The answer could well be a subscription model. While this hasn’t yet been floated as a possibility for Windows Server 2003, it has been discussed from time to time for other Windows operating systems and applications. When I looked at the “Hailstorm” initiative early last year (see links below), after it was hastily renamed “MyServices,” one of the most prominent features was its use of a subscription model. This model has been looked at for at least the past two years as the revenue generator for the entire .Net initiative (see story link below).
There’s nothing inherently wrong with a subscription model and there is a lot to be said in its favor. It allows you to budget software expenses much earlier in advance while allowing you to plan updates and upgrades in a more orderly fashion since these would be released on a monthly or quarterly basis. That beats installing a new operating system every four to five years.
The subscription model is also one of the oldest revenue models for software, although its rarely been called a “subscription.” But even 40 years ago, the general method of obtaining business software was to buy licenses and then pay a percentage of the license fee as an annual “maintenance” cost. This got you monthly, quarterly or semi-annual fixes, patches, updates and upgrades in perpetuity. The only possible uncertainty was whether to add more licenses (more “seats”) as the business grew.
Today, we also have the phenomena of “upgrade protection” which amounts to a presale, at a big discount, of the next version of the software. But (probably for legal reasons) these are usually worded with time limitations (“all releases in the next three years”) and put enormous pressure on engineering to release complex software before its ready to see the light of day. Otherwise the customers get vexed that their agreements lapse before the software ships.
Something needs to be done. The current revenue models and licensing schemes (see https://www.microsoft.com/windowsserver2003/howtobuy/licensing/caloverview.mspx for an overview of Windows Server 2003 licensing – bring along a large bottle of aspirin before reading it) may soon cause large enterprises to consider a new executive – the Chief Licensing Officer. The CLO would spend all of his or her time trying to determine which licenses and how many would best fit the company. A background in n-dimensional calculus might be a good prerequisite.
