New MS Policy: Will Users Defect?
Microsoft's new program for selling its software to businesses may mean bigger profits for the world's largest software company. But according to a research firm, the new Microsoft policy has infuriated many customers, and some could respond by switching to Apple's Macintosh or the free Linux operating system.
Traditionally, Microsoft (MSFT) has charged business users a discounted price for upgrades to the Windows operating system, the Office productivity software suite and other Microsoft products. Companies have routinely upgraded their software every two or three years, ensuring a steady flow of revenue to Microsoft.
As more companies have chosen to keep their old software for three years or more, Microsoft's solution was its new Software Assurance policy. Under Software Assurance, customers will pay upfront for the software, and also pay an annual fee that entitles the customer to an upgraded version of the product in two or three years.
"The fact that folks are even willing to entertain the thought (of switching) is something I haven't seen before," said Laura DiDio, analyst. "I have been covering Microsoft for 14 or 15 years, and I've never seen this level of anger, of outrage, of dissatisfaction."
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