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It's a great theory
Simplifying licensing is a great goal. The major problem though is "how". There are a few big problems here:
* Software is not like your butcher/baker examples. With those examples there it costs the supplier to obtain more meat/buns/whatever. With software nearly 100% of the cost is in writing the software in the first place. The cost to sell one more license is normally very close to $0. That means you want to segregate your customers. You want to get as much money as you can for the product from each person. Some people will find immense value in Windows and will use every feature. Maybe they're a business customer and will make money by using the product. These users will be happily pay more than your average home user that just wants to use Facebook and check emails. That why there's home, pro and ultimate versions of Windows.
* Much of the complexity exists to help end users. To use an example the author mentioned - upgrade licenses. Sure, it would be simpler to only have full versions but that would mean users that want to buy the next version have to pay the full price every time. Upgrade licenses add to the complexity, but it would cost users more without them. Much of the complexity came about for this same reason... per device licensing, per processor etc.
* Microsoft is a big company with millions of users. Unfortunately they need lots of precise legal terminology because people can and do look for any loophole they can.
* It's not related to the complexity, but I think it's worth pointing out for every customer that bought extra licenses to play it safe, there are probably 50 users that do the wrong thing. I know loads of business customers that have gone to their local retail store to buy a copy of Office. They inevitably buy home and student versions. They usually install that one license on all their machines. These aren't dishonest people - it's just human nature. You look for the cheapest product that fills your needs - "Oh look, this one's only $150 and includes Word and Outlook. That's all I need". These people are often shocked when I tell them they need to buy another license for each additional PC. And then there's the people that happily pirate Microsoft products - there are plenty of them. Overall I don't think Microsoft comes out ahead because of their licensing complexity.
I actually don't think things are as complex as the author makes out. I consult in the SMB segment and dealing with licensing is generally very easy. The hardware we buy always comes with an OEM license of Windows. Some clients are big enough to warrant volume licenses, in which case we get a single key, plug it in to our image and forget about it. Not hard.
On the Office side it's much the same. We generally buy either retail licenses or open a volume agreement. The former is a slight pain with images since we have to change key and activate in each one. It adds a couple of minutes to the set up time of each PC. Bigger clients open a volume license. As above , you get a single key and add it to your image. Done.
I think if we're going to advocate simplifying licensing we need to give examples, and I haven't seen any examples yet. I can think of a few:
* Office licensing on terminal servers. You can only user per-device licenses for Office. That's silly and expensive to stick with (Use RDP from your iPhone once - buy another license. Use RDP from a hotel Internet kiosk - another copy of Office per machine please). MS should allow per-user, and I think should go back to also allowing retail copies on a terminal server (like they used to with Office 2003).
* This isn't an EULA issue but an implementation one - I've noticed if you use a volume key on Office 2010 on a PC image you need to reactive/repair Office on each machine (unless you use a local activation server). This is a pain they should do away with.
Actually, they're the only two I can think of off the top of my head. Has anyone got any more concrete examples?
* Software is not like your butcher/baker examples. With those examples there it costs the supplier to obtain more meat/buns/whatever. With software nearly 100% of the cost is in writing the software in the first place. The cost to sell one more license is normally very close to $0. That means you want to segregate your customers. You want to get as much money as you can for the product from each person. Some people will find immense value in Windows and will use every feature. Maybe they're a business customer and will make money by using the product. These users will be happily pay more than your average home user that just wants to use Facebook and check emails. That why there's home, pro and ultimate versions of Windows.
* Much of the complexity exists to help end users. To use an example the author mentioned - upgrade licenses. Sure, it would be simpler to only have full versions but that would mean users that want to buy the next version have to pay the full price every time. Upgrade licenses add to the complexity, but it would cost users more without them. Much of the complexity came about for this same reason... per device licensing, per processor etc.
* Microsoft is a big company with millions of users. Unfortunately they need lots of precise legal terminology because people can and do look for any loophole they can.
* It's not related to the complexity, but I think it's worth pointing out for every customer that bought extra licenses to play it safe, there are probably 50 users that do the wrong thing. I know loads of business customers that have gone to their local retail store to buy a copy of Office. They inevitably buy home and student versions. They usually install that one license on all their machines. These aren't dishonest people - it's just human nature. You look for the cheapest product that fills your needs - "Oh look, this one's only $150 and includes Word and Outlook. That's all I need". These people are often shocked when I tell them they need to buy another license for each additional PC. And then there's the people that happily pirate Microsoft products - there are plenty of them. Overall I don't think Microsoft comes out ahead because of their licensing complexity.
I actually don't think things are as complex as the author makes out. I consult in the SMB segment and dealing with licensing is generally very easy. The hardware we buy always comes with an OEM license of Windows. Some clients are big enough to warrant volume licenses, in which case we get a single key, plug it in to our image and forget about it. Not hard.
On the Office side it's much the same. We generally buy either retail licenses or open a volume agreement. The former is a slight pain with images since we have to change key and activate in each one. It adds a couple of minutes to the set up time of each PC. Bigger clients open a volume license. As above , you get a single key and add it to your image. Done.
I think if we're going to advocate simplifying licensing we need to give examples, and I haven't seen any examples yet. I can think of a few:
* Office licensing on terminal servers. You can only user per-device licenses for Office. That's silly and expensive to stick with (Use RDP from your iPhone once - buy another license. Use RDP from a hotel Internet kiosk - another copy of Office per machine please). MS should allow per-user, and I think should go back to also allowing retail copies on a terminal server (like they used to with Office 2003).
* This isn't an EULA issue but an implementation one - I've noticed if you use a volume key on Office 2010 on a PC image you need to reactive/repair Office on each machine (unless you use a local activation server). This is a pain they should do away with.
Actually, they're the only two I can think of off the top of my head. Has anyone got any more concrete examples?
Posted by gechurch
17th May 2012
