Slashdot Mirror
Microsoft Customers Get No Bang for Buck
sammy baby writes "Software missing its ship date is commonplace enough that it's usually only mentioned for yuks. However, subscribers to Microsoft's Software Assurance program are discovering that it can have some very real repercussions. According to NetworkWorld, many licencees are discovering that due to slipping release dates, many thousands of dollars spent on these contracts have brought them zero return."
At what point did these customers forget they are dealing with a software company? Missed dates, slippage, heck, I work as a programmer and there's often good reasons (You can have it now unfinished, untested or with bugs OR you can wait for it to be finished, passed Q/A and tested), granted there are numerous examples of Microsoft using the customer for testing after rollout ("Oh, that bug will be fixed in the next service pack"), but again I don't think they're unique. They're just singled out because Microsoft is a favorite whipping boy. Imagine the losses that may be incurred by (more) flawed code being released on schedule.
A feeling of having made the same mistake before: Deja Foobar
... remember it's not only MS who produce vapourware. Pre-orders for, say, Duke Nukem Forever have gone the same way - although I dare say most retailers offering a pre-order will have issued refunds.
Sadly, in business, slippage does occur and contracts do expire. It's not preferred, but it occurs more than most people would like.
The long and short is, IMHO this is only noteworthy at this time because of the sheer scale in terms of both cash value and number of "victims".
"It is dark. You are likely to be eaten by a grue." -- Zork
On the other hand, there's one born every minute. Usually that's plenty.
===== Murphy's Law is recursive. =====
I'm pretty sure this exact thing is why almost everyone was against the new licensing when it was announced.
Can't come as a suprise.
Belief is the currency of delusion.
A lot of Microsoft revenue has always come from very sketchy licensing policies. I don't see why this new twist should surprise anybody. It's just more typical behavior from monopoly.
Still doesn't make customers very happy. Mind you who on earth would buy a subscription to "We might send you some magazines this year, but maybe not"...
let this thing linger for a few days/weeks, let more and more people vent their (righteous) anger at the utter waste of money that the licensing has proved to be and then, magnanimously, they will offer a renewal option for three years for the price of two with a guaranteed major release or a refund of half the price (or something like that). And all the while, they'll paint themselves as being responsive as opposed to the reality of them being abusive (in the monopolistic sense)
I am one of those IT managers that had a real problem with Microsoft's Licensing 6.0. By essentially forcing IT managers into pre-paying for upgrades every three years that they may or may not use and removing any possibility of customer loyalty upgrades, Microsoft went from fair preservation of their revenue flow to outright extortion.
Essentially you are being asked to pay a substantial amount of your IT budget for an upgrade sight unseen. Usually before you bring a product into your company you evaluate it for technical soundness and applicability to user needs and business requirements.
Microsoft seems to assume that their upgrades will always meet these requirements.
If you don't want to repeat the past, stop living in it.
All of the software companies have similar problems. The big difference is that Microsoft virtually forces you to buy into their program if your company is large at all.
Because of their monopoly, you have to upgrade eventually. If you don't buy into SA, the individual upgrades later will cost you much, much more. So you end up having to gamble and pick between the two choices.
..that e.g. SuSE (with their Enterprise Software) offers something similar:
;-)
during the time you have a maintenance contract
- which is required to actually download
patches - you can also upgrade to a newer
version of the product, if it is available.
So you actually pay for the maintenance and get
upgrades "free".
Microsoft should do the same, then people would stop whining. At least for the above reason
Windows 2000 - from the guys who brought us edlin
It's impossible to tell in advance what these contracts are going to be worth. In short, these people paid for any updates to Windows in 2004 or 2005 on the assumption that there would be one. Microsoft never promised one, but they hinted that Longhorn should be ready by then, and it's been Microsoft's habit to release a new OS every two or three years.
Well, sorry, no new release. Nobody promised one, they just assumed like fools that there'd be one. Ton of money wasted. Oops.
Thing is, how can Microsoft ever sell these subscriptions again to companies that paid and got nothing?
Just to show that this couldn't possibly come as a surprise for whoever PHB'es penned these agreements:
..and..
So it's not "news" that this scheme would cost you a whole lot with the possibility (and high probability) of giving almost nothing in return.
If anyone who signing up for Licensing 6.0 actually believed that Microsoft would let them get the next great thing "for free", then I've got one nice bridge to sel^H^H^Hlease them.
Belief is the currency of delusion.
The CIO of a company should know better than to get a maintenance contract just so he can upgrade based on a roadmap that may or may not materialize. If you want the maintenance only so you can upgrade, wait until the upgrade is out and THEN sign a maintenance contract.
The CIO needs to make it clear in summary to the CEO and CFO that these are the expected benefits, these are the assumptions I'm making and these are the risks. In my opinion he didn't do his job and now he's blaming Microsoft for failing to pedict the future, and he's making a fool of himself in the process.
If you're going to blame Microsoft, blame them for something they've done wrong. Don't try to penalize them for telling you what their plans are (a good practice in my opinion), or for your own stupidity. It makes you look like a whinning twit when you do have a legitimate complaint.
These posts express my own personal views, not those of my employer
many thousands of dollars spent on these contracts have brought them zero return.
Why, just in the last few months they got Blaster and Bagel and MyDoom and Skynet and...
John Conner: Boss, our customers realize they have been ripped off.
Bill Gate: We've seen this problem before. We'll just release Service Pack 5 as a new OS. It's new if we say it is. Have Marketing design a new splash screen. That will fool all those bumpkins.
John Conner: <snicker> You're right again Bill!
Bill Gate: Yes I am, because I am smarter than everyone else.
John Conner: Then do you think you could help me out? My mother, Sarah, is being chased by a cybernetic killing machine sent from the future...
Liberals call everyone Nazis yet they are the closest thing to it.
The chart lists $1.8 billion in 2003, $1.1 billion for 2004 and $0 for 2005. Why even list 2005? It hasn't happened yet. All this chart does by having 2005 on there is mislead people into thinking that 2005 was fruitless. What a base way to "support" what you say in your article. When I got to that part, I dismissed the article even though I agreee that MS is in for trouble with the upgrade dilema. Bad journalism strikes again.
US Democracy:The best person for the job (among These pre-selected choices...)
"Hey, boss, Microsoft gave you nothing for something. Now check out this OOo stuff, where you get something for nothing."
If all this should have a reason, we would be the last to know.
Sorry, I thought this was Fark for a second.
I don't know the meaning of the word 'don't' - J
Contracts are what you use against your customers.
Duh.
In the free world the media isn't government run; the government is media run.
I happened to be in charge of IT for two different small companies near the Software Assurance deadline, and made the recommendation to decline the move to SA.
In both cases, it just did not look worthwhile... I didn't think the Microsoft product cycle was likely to be fast enough to warrant the subscription. (Plus I was annoyed with the enforced change, as were many other folks in the industry... but that wasn't sufficient basis for the decision, alas.)
But it was a pretty high stakes game. Guessing wrong would cost thouands of dollars in the long run for each company. It's quite a relief to see that I guessed correctly... so far.
Amusingly, Microsoft has now managed to give pretty much all of its business customers cause to be annoyed with them. The first group was annoyed by the enforced choice between the loss of upgrade value and the expense of Software Assurance. The second group, that chose SA, should be getting pissed off right about... [checks watch]... now.
With reasonable men I will reason; with humane men I will plead; but to tyrants I will give no quarter. -- William Lloyd
I think the ultimate product for stupid people will be pre-paid health insurance (coming soon to an HR department near you I'm sure).
Once you've paid for such a plan, it's in the provider's interest for you to die as quickly and efficiently as possible so that they get your money but don't have to provide any services in return.
The Microsoft pre-paid license program is just one step below this.
On the other hand, the typical business customer might actually like a way to pay for *not* having software updates, since constantly having to upgrade to the latest version is a pain in the neck, along with having to deal with the feature bloat that is required to otherwise motivate people to upgrade.
This is the business that RedHat has gotten into where in exchange for money they guarantee that the software you're running today will remain supported for a much longer period and you won't be forced to upgrade before you want to, and it's clearly the direction Microsoft is tring to move as they start running out of compelling feature-based reasons to upgrade from verison N to N+1.
So if you don't want things to change, by all means pay in advance, but if you're looking forward to new features, wait until the product actually ships before handing over your money.
G.
MSDN Subscription: $2,000
Windows XP License Agreement x 200: $12,000
Office License Agreement x 200: $20,000
Being Bill Gates and laughing all the way to the bank for having to provide nothing extra: Priceless
For all your price gouging and junk software there's Microsoft. For everything else, there's Open Source.
From two years (2000 through 2001) Microsoft provided essentially nothing in the way of new programming tools (or heaven forbid, bug fixes) to it's $2,000/seat MSDN customers. .NET so their net profit remained $1800/year.
.NET. (To be fair, it comes with a free copy of Office 2003.)
After two years of 90% profit margins ($200 worth of duplicate DVD/CDs + shipping), in 2002, they raised the price by about $1000 for 2002's
So, except for the few MSDN customers who were smart/quick enough to figure out what Microsoft was up to, they ended up paying $7000 + $2500/yr for
Small problem. There is a huge difference between publishing a roadmap/timeline and keeping it. Software is sadly a hugely complex product. Worse it is horribly interconnected meaning that it takes forever to properly test and you can bet the moment it is out someone comes accross a situation you never though off.
But this is well known. So nobody in their right mind counts on a software product being released on time or in a promised form. Like the real world you only trust what is actually right there in front of you.
Would you buy a car that during the testdrive fails the brake test but they promise they fix it in yours? Of course not. So why do you buy software that you tested as broken but they will fix it in a patch they are going to make?
This is even worse. This is like buying a car on the promise that if they come out with a better model in 3 years they will give you that one.
No the people who signed up for this are MS junkies of the worst kind. They will signup again cause it is easier then thinking. Worse if they don't signup again they will have to admit they weren't thinking the first time. Signup again and all they gotta do is gloss over the fact that nothing was received in return. That is easy.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
It appears to me that Windows/Office/etc. are finally becoming "good enough" and people/companies are not seeing the need to upgrade anymore. (I know.. both windows and office are still buggy and closed source, but for most desktop users they are good enough... finally). What does this do to Microsoft's business model of "force your customers to upgrade every x number of years"? I imagine that is why Bill G. wants the world to go to subscription based software (i.e. rent Office per month).
=-=-=-=-=-=-=-= - The Celtic - =-=-=-=-=-=-=-=
You are a CTO. You advised to buy the software assurance plan at first.
Now you have two choices. Recommended renewal and possible have to explain if your ceo is even aware that no the old subscription was perhaps not full value. (can easily be argued that instead you paid for the patches, god knows there been enougn for them. Also easy to show figures it is actually cheaper, MS salesrep can give you those).
OR you tell that you were wrong before and are responsible for wasting shitloads of money in a down economy for absolutly no return whatsoever.
Mmmm. Though choice ain't it? MS doesn't have to sell anything. All the people who bought it will sell it for them or be fired.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
This all is just a terrible misunderstanding.
Microsoft wants a fixed revenue-stream for the minimum of possible work.
No, I understood that. That's why I got in hot water with my boss for laughing at the IT Director when he told me they signed up for SA.
Alito: A vote for Alito is a punch in the eye to put that bitch back in her place!
We're killing the support contract of our company with IBM, and spending the money on another identical server instead. Shit happens, we swap the new with the broke server, surely much faster than waiting for their next-day service.
Same with Microsoft. We were paying support for copies of Windows 2000 server, when I realized we've never placed one call to Microsoft. Things go wrong, we format and reinstall Windows; much faster than arguing with a MS technician isnt it?
So just purchasing duplicated hardware and software gets the job done better and cheaper in most cases, except say for ERP systems in which case a bug will have to be fixed and the system cant be just reinstalled for a fix.
I know support contracts are different from software subscription licenses but thought I'd mention it here for brevity. Now on that topic, I wouldnt quite understand why anyone would need subscription licenses from Microsoft anyway. Its 2004 and we still insist on running Windows2000SP4 instead of XP or 2003. We'll wait till 2005 and SP3 before considering 2003. IT departments crave stability in their servers, so going cutting edge with Micrsoft is like shooting yourself in the foot. I wouldnt even go cutting edge on Redhat if the server hosts important stuff.
So ladies and gentlemen of IT, please stop the frenzy of latest, more, bigger, faster, cutting-edge and focus more on better, smarter. We're all in the business of making money.
"Give orange me give eat orange me eat orange give me eat orange give me you." -Nim Chimpsky
I grant that you don't get many applications that offer unlimited upgrades, but WinZip is one of them.
I've used it for many years now, and just recently updated to the most recent version to fix a security flaw in the old one.
This is precisely why I advised our COO that we not buy any subscription program when we upgraded to WinXP and Windows Server 2003. Microsoft allowed nearly three years to elapse between Win2k and XP/2K3, and the two year interval for subscription pricing just seemed too short. I gambled that Microsoft wouldn't make a major release in the next two years, and it appears it was a good gamble.
I had a long talk with one of the enterprise account reps at CDW, and I asked him just how many of his customers had actually bought into subscription. "Less than 15%," he said. Seems I wasn't the only one with this idea. When (if) we do upgrade to Microsoft's latest and greatest, we'll have to pay full price, but that should be less than the cost of two subscription terms. I'm also betting that Linux pricing pressure will force Microsoft's next product offering to be substantially cheaper than their current lineup.
In the end they will lay their freedom at our feet and say to us, Make us your slaves, but feed us. - Fyodor Dostoyevsky
I'm not really in the software support realm, I support network equipment. So I'm trying to compare this to Cisco SmartNet(tm) and it makes me ask this question:
If I have support for a device (let's say it's 7x24xhr onsite replacement, which isn't real cheap) and the device does NOT fail then have I paid something for nothing? I've still had access to the TAC all this time and all the other things that come with support.
Now I know software doesn't physically break in such a way that you need a new identical replacement from the vendor, but to me this seems similar. It was possible that Microsoft was going to come out with an upgrade during this time, so you buy the contract. You also get (according to the article) access to support services.
On the one hand I know that most folks bought this for upgrade protection, but on the other hand it seems to me that support is insurance, not a gamble that you'll get something out of it. If I'm wrong please correct me.
"Where quality is like a dead stinking rat - you just can't miss it."