Software Assurance Isn't Reassuring

Marketed as way for customers to stay current with Microsoft technologies, Software Assurance (SA) was supposed to be a two-way street. By committing to paying regular license fees, customers could potentially save money over the long haul. But the primary benefit-at least from Microsoft's perspective-was that customers would have access to Microsoft's latest and greatest software releases.

In addition to enjoying predictable income from its primary product lines, such as the Windows OS and Microsoft Office, Microsoft was positioned to reduce support costs by keeping customers on the most recent software. However, as the hand has played out, SA's benefits are heavily weighted in Microsoft's favor, and many customers get the short end of the stick.

The Customers' Take on SA
To learn what Microsoft users think about the SA program, we went to our Advisory Panel, which consists of approximately 500 IT pros who work in every region of the world. The Advisory Panel was decidedly split over the adoption of SA: Fifty-four percent of panel members said that their companies chose not to buy SA, whereas 46 percent have purchased it. Our readers tend to be Microsoft advocates and enthusiasts, yet acceptance of SA isn't the norm even in this pro-Microsoft group. By far the most common reasons for going with SA were cost savings and quick accessibility to future upgrades. Many panel members also mentioned the benefits of predictable software costs and fewer licensing hassles.

Perhaps not surprisingly, cost was also the reason most companies chose not to purchase SA. Most of these companies stated that they had a longer upgrade cycle than an SA subscription accommodated. Many of the businesses that opted not to buy in to the SA program described themselves as small businesses or businesses that don't buy a lot of software. A surprising number didn't even know the program existed, which illustrates the fact that Microsoft isn't effectively marketing to small businesses.

The biggest problem cited, however, was Microsoft's poor ability to accurately predict when future versions of software will be released. Clearly, Microsoft can count on the income from SA customers, but the customers can't count on Microsoft delivering the products they need. One panelist described SA as a "crapshoot. if Microsoft doesn't release in your support window, you don't get any updates."

Those who bought SA mentioned other problems in addition to this uncertainty. Of the companies that purchased SA, more than 51 percent either weren't sure it had any benefit or were dissatisfied with what they had purchased. One respondent summed up the problem with SA software deliverables succinctly: "One word: Yukon." Not all the panelists were specifically looking for Microsoft SQL Server 2005 (formerly code-named Yukon), but many expected to receive some other software upgrade-such as the next version of the OS, code-named Longhorn-that was delayed so far as to fall outside of their SA subscription. Another reason for dissatisfaction with the program is that many companies have found that they're paying for software twice-once as part of SA, then again for the same software when it's preinstalled on the PCs they buy.

Despite those concerns and problems, most panelists agree that SA is here to stay. SA worked best for companies that planned an immediate software upgrade. Those businesses were able to capitalize on SA to get a significant savings on that upgrade. They got the software that they wanted, and most believed that they got what they paid for.

SA didn't work when organizations relied on Microsoft's expected release date for an upcoming product and bought SA expecting to get that release. Many of those businesses believed they received a bill of goods, paying into the program without getting what they expected.

What to Do?
SA is a good idea, but it obviously doesn't work for all circumstances. Microsoft needs to put more reassurance into SA either by significantly lengthening the duration of the SA subscription period or by tying the subscription to specific product releases rather than a strict time period.

In the meantime, if you're considering buying into SA, I strongly suggest you take a good look at your current business plans, especially in regard to upcoming software purchases. If you plan quantifiable purchases that can immediately take advantage of SA, you'll be happy taking the SA route. But if you're looking into SA as a software upgrade safety net, you're probably better off passing on it for now.

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