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Ballmer: Don't Expect Simpler Licensing Soon

nk497 writes "Steve Ballmer has admitted Microsoft's licensing is too complicated and contains too much fine print, but has no plans to change it at the risk of angering shareholders — and even customers who benefit from the confusion. "I'm sure we have fine print we don't need. We're not saints," he said, adding that customers have a way of figuring out how to pay the least amount of cash possible to use Microsoft's software. "Customers always find an approach which pays us less money.""

35 of 260 comments (clear)

  1. Absolutly by afidel · · Score: 5, Informative

    We take advantage of MSDN, it's MUCH cheaper to pay for MSDN subscriptions for our technical staff then it is to pay for ~2/3rd's of our environment (Dev+Test). It's also nice to use Windows Datacenter licenses to pay for an entire stack of VM's.

    --
    There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
    1. Re:Absolutly by POTSandPANS · · Score: 5, Insightful

      So what you are saying is that licensing is not that complicated if you have a bunch of cash to throw around?

    2. Re:Absolutly by segedunum · · Score: 4, Insightful

      We take advantage of MSDN, it's MUCH cheaper to pay for MSDN subscriptions for our technical staff then it is to pay for ~2/3rd's of our environment (Dev+Test).

      Yes it is nice.......... Until you realise that, if you stupidly buy into it, as a development company you are stipulating Microsoft software and licensing as a prerequisite for any deployment or implementation of your work for a customer. You can't use your MSDN licenses there. You will also have to factor that into your quote, budget and costs. Why do you think Microsoft has MSDN? A lot of silly companies who are built around being Microsoft partners and using MSDN have found it tough because Microsoft always takes their cut regardless.

    3. Re:Absolutly by afidel · · Score: 5, Insightful

      Uh, the vast majority of businesses are just fine paying for MS licenses to run software. There are a few all Linux/Unix shops out there but they are by far in the minority. I know most of the software we buy absolutely dwarfs the cost of the hardware + MS licenses (most of the purchases we've made in the last couple years have been mid 6-figures to 7 figures + equal costs for implementation consultants, the cost of our MS licenses barely breaks into the 6 figure range across all systems). It's a cost of doing business just like any other.

      --
      There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
    4. Re:Absolutly by Anonymous Coward · · Score: 3, Insightful

      Yeah, if you can afford to throw around.. oh, what is it, $10-$12k per developer PER YEAR, then I guess MS licensing is not a problem? (That's the license cost for Visual Studio 2008 with Team Suite and all the trimmings.)

      I'm pretty convinced that MS developer licensing is designed to be confusing in order to extract a maximum amount of money. The VAR that I used to work with that did the MS licensing couldn't figure it out, either, until they got an MS specialist on board, and EVEN THEN the MS specialist couldn't figure out what I needed for a small team development environment.

      Note to Ballmer: there's a reason why developers don't like to develop for Microsoft products, and it's mostly tied up in the licensing crap. Second note to Ballmer: $12k/year for full VSTS 2008 is retarded. You want cool Microsoft software, lower the price down to about $250.

    5. Re:Absolutly by afidel · · Score: 4, Insightful

      We bring in $100+M/ quarter, if we can make the business even slightly more efficient a couple million dollar project easily sees a positive ROI. You just have to do your due diligence and not take on projects that are unlikely to have a positive impact on the business. If you are spending money without justification then of course it can be a problem for the business, but then you're not really doing your job, are you? IT is a tool, not a goal or an end unto itself.

      --
      There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
  2. Obligatory Open Source comment by jo42 · · Score: 5, Funny

    customers have a way of figuring out how to pay the least amount of cash possible to use Microsoft's software

    Yes. It's "Format C:" followed by installing some flavor of Linux and Open Office.

    1. Re:Obligatory Open Source comment by Sockatume · · Score: 3, Insightful

      Why the "Format C:" bit? Is the previous step in your money-saving plan "buy a computer with Windows on it"?

      --
      No kidding!!! What do you say at this point?
    2. Re:Obligatory Open Source comment by parodyca · · Score: 3, Informative

      Hell Yeah, Have you ever tried to buy a computer without windows on it? It is always cheaper to by a windows machine and wipe the OS then it is to buy a NoOS machine.

    3. Re:Obligatory Open Source comment by CannonballHead · · Score: 4, Insightful

      Have you ever tried to buy a computer without windows on it?

      Uh-huh. They're called "parts." :)

    4. Re:Obligatory Open Source comment by eln · · Score: 5, Insightful

      I'm not so sure about that. It's getting harder and harder to buy parts and build your own for cheaper than you can get a pre-assembled box. These days, the only reason to build your own is if you want to pick and choose every component for quality, in which case cost is not your primary driver. If you're going for cheap, something pre-assembled from Dell or a similar company is usually cheaper, especially if you consider the value of your time. Even if you value your time at $0/hr, you can still often get a pre-built from Dell cheaper than a comparable build-your-own system.

      I've never bought a pre-built system in my life, but I'm seriously considering it now that I'm looking to replace my 4 year old desktop system. It's just not worth the hassle to build your own when it doesn't really save you any money anymore.

    5. Re:Obligatory Open Source comment by AnalPerfume · · Score: 3, Insightful

      That would be the subsidized trialware model. If you have plenty of companies paying to have their 30 day trial shit installed on every box, it offsets the cost of Windows, giving the illusion that Windows is free when it's not. Retailers should be forced to provide a Windows refund form with every sale of a new PC, since they refuse to offer the customer the choice of actually buying it without Windows. They should also be forced to list it as a separate item in the pricing, as it's not a requirement to run the PC.....of course doing that would let the whole trialware racket out of the bag too.

    6. Re:Obligatory Open Source comment by Nerdposeur · · Score: 3, Interesting

      I bought a Dell with Ubuntu back in April. It was cheaper than the equivalent Windows machine AND came with a bigger monitor.

    7. Re:Obligatory Open Source comment by Archangel+Michael · · Score: 3, Informative

      DIY = CUSTOM build

      The reason to DIY is because you need a config that DELL doesn't offer. Oh, like building a MythTV box with SATA Raid and hot swap cage for the HDs. Or even the proverbial "Gaming Rig".

      However, if what you want is a computer for your house, then DELL (or HP or ...) is a completely viable choice.

      The problem isn't DIY being "cheaper" it is that you can get a customized rig built the way you want for the purposes you need.

      --
      Agent K: A *person* is smart. People are dumb, stupid, panicky animals, and you know it.
  3. MS licensing is very simple... by Anonymous Coward · · Score: 4, Insightful

    buy it and you're fucked.

    1. Re:MS licensing is very simple... by Anonymous Coward · · Score: 5, Funny

      buy it and you're fucked.

      The polar opposite of FOSS; don't buy it and don't get fucked :)

  4. WTF? by Anonymous Coward · · Score: 4, Insightful

    "Customers always find an approach which pays us less money.""

    Other than piracy, switching to Mac or Linux I don't know what he means? Sounds like sour grapes. I guess he feels his paycheck should be bigger. It's a wallet not a phallic symbol.

    1. Re:WTF? by Sockatume · · Score: 4, Informative

      He's talking about bulk-licencing customers. Corporations and educational institutions.

      --
      No kidding!!! What do you say at this point?
    2. Re:WTF? by Anonymous Coward · · Score: 3, Informative

      Considering their fear of a non-MS generation of graduates, I suspect MS would pay YOU to use their stuff if your budget couldn't find that $4k.

      Most corporations are considered "captive" and get very little in the way of discounts unless they have an Enterprise Agreement. MS has a wide variety of programs that look like volume discounts, but are in fact not discounts at all. For example, my company would routinely buy OEM copies of MS Works and keep the media kits in a storage closet. That enabled us to buy MS Office at the "upgrade" price instead of paying full retail for new machines. Try as we might, nothing short of an EA could come close to the pricing we could get via plain-old "bait-and-switch" retail products, purchased as quantity 1. OEM Office licenses are almost good enough, but there are hidden gotchas. Sometimes we would get PCs bundled with Works, and that made it even easier. Not sure if the loophole is still open, but MS' resistance to discounting (after all, why should they?) is what leads to creative purchasing.

      The secret of software pricing is that the vendors have to find a way to soak the customers with deep pockets. There will always be someone with a big budget who would rather write a check than manage the cost of software. There are even some that think ANY price is worth paying so long as the productivity is there. Therefore, it is essential to extract maximum revenue from those who have a loose money policy. But there are some who threaten to disrupt the balance of power by shifting to Linux or OS X. Nowhere is this more critical than in higher education People who prove unwilling to pay top dollar have to be kept the fold without letting the big fish off the hook.

      If you can't afford the Kool-aid, it will be discounted (or even donated). But whatever you do, drink up!

  5. This is a non-issue for Microsoft's Customers by mpapet · · Score: 5, Interesting

    I'll give you a hint, their customers are not the admins who actually have to comprehend and create policy/procedure to abide by License terms. They have two primary customers.
    1. The retail consumer who doesn't read EULA's and willfully violates them.
    2. The purchasing manager/executive class.

    Sysadmins aren't on that list.

    Moreover, Mr. Ballmer is giving the implicit nod to violate the terms of the license agreements. Guess who loses on that deal? The sysadmin!

    --
    http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
  6. Bad summary. And bad article. by CannonballHead · · Score: 4, Insightful

    It looks like most of the article takes small quotes from Ballmer and presumably paraphrases the rest. There aren't a whole lot of quotes form Ballmer himself. And the slashdot summary is even worse. Firstly, he appears to be referring to companies with this quote, not end user customer type peoples (emphasis mine):

    But he claimed that the finer details of the licensing system give some companies the opportunity to save money. "Customers always find an approach which pays us less money," he claimed.

    Here are some of the *other* quotes from the article that the summary left out.

    "Every time you simplify something, you lose something that people used to save money," he added, suggesting that even minor changes to the system could hurt some of its customers.

    "The goal is to simplify without a price increase," Ballmer said, adding: "Our shareholders want simplicity without a price decrease."

    He added that customers donâ(TM)t want simplicity for the sake of it, claiming that the last time Microsoft tried that route, customer ratings of the firm "plummeted for two years."

    Ballmer seems to also be noting that shareholders and customers want two different things: shareholders want Microsoft to charge more and do it more simply, and customers want Microsoft to charge less and do it more simply. Everyone wants it simpler, but simpler+price-decrease and simpler+price-increase are two different things. But don't read what he really said. Just assume he means the worst and let's pretend that one of the largest (the largest?) software companies has a complete idiot in charge and that EVERYONE knows he is an idiot but they keep him there anyway. Or something like that?

  7. Ballmer: "We're not saints" by blind+biker · · Score: 5, Insightful

    No shit. When was the last time Microsoft did something the customers wanted, instead of forcing them to "take it or leave it". When was the last time any Office application didn't brake file compatibility with previous versions. When was the last time you felt like you actually own a Microsoft software product, and don't have to rent it AND justify yourself every time you need to install it on a new computer? Last time some Microsoft protocol didn't break compatibility with competing, or even older own protocols? I don't know, it feels like forever.

    Licensing issues are really just the tip of the iceberg of this Satan's spawn called Microsoft.

    --
    "The agriculture ministry is not in charge of Gundam" - Japanese ministry official.
    1. Re:Ballmer: "We're not saints" by CannonballHead · · Score: 4, Informative

      When was the last time Microsoft did something the customers wanted, instead of forcing them to "take it or leave it".

      I've never been forced to. I upgrade/install on my own. Work/corporate environment is a different story, but at home I choose my OS.

      When was the last time any Office application didn't brake file compatibility with previous versions.

      Saving or reading? I just save in XP/2000/2007 format. Works fine, including with openoffice, which is what I use anyway.

      When was the last time you felt like you actually own a Microsoft software product, and don't have to rent it AND justify yourself every time you need to install it on a new computer?

      I've installed and re-installed XP many, many times. I have always felt like I owned it. I've installed Vista (and Windows 7, actually) multiple times with no problem. Yes, I "register" or activate it. No issues with it. Even the phone activation is quite simple. Some of my other software, like Sibelius gives me a much, much, much harder time with activation and whatnot. But it's good software and I like using it, so I deal with it.

      Last time some Microsoft protocol didn't break compatibility with competing, or even older own protocols?

      Like what?

      I don't know, it feels like forever.

      When was the last time you USED a Microsoft OS (or Office)?

  8. Microsoft's product? by argent · · Score: 4, Insightful

    He added that customers don't want simplicity for the sake of it, claiming that the last time Microsoft tried that route, customer ratings of the firm "plummeted" for two years."

    Unless Microsoft sees its product as being licenses rather than software (which is entirely possible, now I think of it) this is daft. People have to interact with the software on a daily basis. They only care about licenses when they get in their way... which is more likely to happen if they don't know what they're buying.

  9. Retail Customers by Fear13ss · · Score: 4, Informative

    As a past employee of a Retail store, I know for a fact that they always find a way to make customers pay much more then is necessary for everything they can, up to and including OS's. I don't know how many people were sold on "Media Center" functionality they never used and that's just scratching the surface. As for the Obligatory Open Source comment, our licensing is much more simple. http://www.ubuntu.com/community/ubuntustory/licensing

  10. Even MS can't understand it by sjames · · Score: 4, Informative

    It's remarkable really. Even MS support can't tell you consistently what you actually need to be legal for a given situation. Call three times with the same scenario and get three different answers.

    Talk about business risks, you're just begging to have the BSA commandos sweep in and decide that whatever you guessed (or what MS told you to do) isn't correct and you are now a dirty thief who owes a pile of cash. No, thanks!

    If they're going to get all bent out of shape about license compliance, the onus is on them to make it possible to know with certainty what you must do (and spend) in order to be compliant. Given that their own support people aren't sure, I'd say they failed miserably.

  11. 5 Simple rules of Microsoft licensing by jd2112 · · Score: 5, Funny

    Rule 1: You are out of compliance.
    Rule 2; If you have reviewed your licenses and purchased additional licenses to cover any license shortages (plus additional licenses just to be safe), See rule #1.
    Rule 3: If you think you understand Microsoft license agreemenents, you are either delirious or just not paying attention.
    Rule 4: If you are a lawyer for Microsoft in charge of writing license agreements, see rule #3.
    Rule 5: See rule #1.

    --
    Any insufficiently advanced magic is indistinguishable from technology.
    1. Re:5 Simple rules of Microsoft licensing by tsm_sf · · Score: 3, Funny

      Crowley had been extremely impressed with the warranties offered by the computer industry, and had in fact sent a bundle Below to the department that drew up the Immortal Soul agreements, with a yellow memo form attached just saying: "Learn, guys."

      - from Good Omens

      --
      Literalism isn't a form of humor, it's you being irritating.
  12. Re:Building PC's by MindPrison · · Score: 4, Informative

    Same here, until my last computer - that is.

    Prebuilt consumer computers are really crappy. Take my latest HP Pavillion Quad Core as an example, after 1 month, the keyboard stopped working, after 3 months the wireless module went to wifi-heaven where little wifi things go (All wifi's goes to heaven, the movie), and after the 5th month, the DVD stopped accepting pretty much any DVD & games even though there where no dust. I'm just waiting for the next thing to break for no reason. At work it's the same thing, the pre-built one breaks down, not the ones I built - they still stand!

    --
    What this world is coming to - is for you and me to decide.
  13. Re:Building PC's by mitgib · · Score: 4, Insightful

    Just like any other business or government body, the lowest bidder gets the contract. When the P4 came out, Dell stopped making good quality PC's and focused more on low bidder parts fulfillment.

    --
    Being a spelling & grammar Nazi is a sign you do not poses the intelligence to contribute to the conversation
  14. I disagree by Locke2005 · · Score: 3, Insightful

    "Customers always find an approach which pays us less money." If that were true, wouldn't all of Microsoft's customers already be using Linux? (They still use Microsoft because they believe the costs of rewriting applications and retraining users exceed the cost of licensing the latest releases from Redmond.) I'm not even sure that customers even do a decent job of calculating Total Cost of Ownership, since they frequently neglect the potential cost of security holes, as well as the cost of not saving copies of all your licenses and then getting a visit from the BSA.

    --
    I've abandoned my search for truth; now I'm just looking for some useful delusions.
  15. Symptom of Doom? by Tablizer · · Score: 3, Insightful

    Stockholders tend to not care about 10 years down the road. They want their money now. If you are in MS shoes and you are being pressured to return to prior levels of financial growth despite being squeezed by Apple, Google, Linux etc., then the easy way out is to squeeze more licensing fees out of existing customers who's tool stack is based around MS products. They almost *have to* pay. The downside is that resentment is building which will start to bite back down the road. They ran out of logs and are now burning strips of cabin.

  16. Re:Absolutely by Anonymous Coward · · Score: 5, Insightful

    Comments similar to yours from our competitors bring nothing but cheer to my heart. Fortunately for our shop, Free software meets our needs practically from top to bottom. Not only does it meet our needs but it exceeds them in ways Microsoft can't. Not just in pricing but in functionality and flexibility. The interesting thing is, most or our competitors' infrastructures could be ran similarly but through a combination of sheer ignorance and the inability to ween themselves from the MS teet, they continue to needlessly spend millions on restrictive licenses while we invest the same money in things that actually add to the bottom line and help us grow. Consequently, in the recent economic downturn, we've thrived while some people I used to know in this business have just flat out gone under.

    Not saying that Free software is for everybody because it isn't. You must have actual competent IT staff to wring the every last bit of value of it. A crew of MCSE's aren't going to cut it. We, with the help of a certain hire several years ago, saw the light and changed from being a complete MS shop over to Free software with very little problems. And it either meets your needs or not. But I'd be willing to bet that just about any outfit has some slack and could stand to save a few bucks on licenses somewhere.

  17. Re:FUD by conureman · · Score: 3, Interesting

    When I went to school, I told them I didn't want to do Windows, but wanted to learn Unix admin. They said it was "much to complicated for a novice" and I "had to learn Windows first to understand the basics". Translation: they didn't have a Unix curriculum.

    --
    The cost of that cleanup, of course, will be borne by taxpayers, not industry.
  18. Keep over charging by 1s44c · · Score: 4, Funny

    Stop over charging for your software, and perhaps more people would buy it instead of pirating it.

    They should keep overcharging to encourage their customers to look for cheaper and better alternatives.