“Virtually no one reads and they click ‘next,’” says Ron Herd, Microsoft Practice director for Pomeroy IT Solutions in Hebron, Ky. Herd meets with many clients who struggle with understanding their options related to Microsoft licensing and how to maximize their investment in Microsoft technologies. “A lot of people think licensing is mundane and tactical. But when you evaluate your business goals and the technology you will need over the next three to five years, you will maximize your Microsoft investment by licensing it under a program that makes the most sense for your business.”
Smart Business asked Herd to discuss Microsoft licensing options and why it is critical that business owners choose the appropriate agreement for their business needs.
What is a license exactly?
You don’t actually buy software you buy a license to run the software. For the vast majority of software publishers, including Microsoft, that license is governed by an End-User License Agreement (EULA). That is the statement that pops up when you install a program and says ‘Read this first and check the box before continuing.’ So, you are actually not purchasing software, but rather, a license that says what you can and cannot do with the programs.
What are the risks of not licensing software appropriately?
First and foremost, the risk is not being in compliance. Most businesses are in compliance, or want to be, but sometimes the complexity of understanding all the options can be daunting. The second major business risk is not being in the right licensing program. Entering into the right program based on your business goals and objectives will ensure that you are receiving the greatest discount as well as maximizing your investment in Microsoft technologies.
When do most business owners confront licensing issues?
A lot of times, customers don’t think about licensing until they are ready to buy new software or upgrade versions, or as needed. It’s strategic if they focus on it from a programmatic perspective and map their business goals and objectives over the long run to the right licensing program to help them achieve those goals and objectives.
How do you outfit a business with the best licensing option?
We sit down and try to understand what Microsoft programs the company currently runs. What version are they on? Does the business have a migration plan in place for those products? We help make sure that each account understands the features and functionality of the software they own, and how they may be able to take better advantage of it to increase revenues, decrease costs and enhance communications.
For example, a lot of our customers today are looking for ways for their field-based service employees and salespeople to have access to information anytime, anywhere. These salespeople need the ability to connect with customers quickly with the right information. They may just have cell phone coverage today but they want to take a look at enhancements to improve their messaging and mobility. This may sound like it has nothing to do with software licensing, but it is vital information to help ensure we match the right licensing vehicle to each customers’ business needs, especially over a longer period of time.
What are some licensing agreement options?
Agreements depend on the size of the business and its goals, as well as its need for flexibility. Without going into tremendous detail here, Microsoft has several different types of licensing agreements. It’s a double-edged sword for them because, on the one hand, these options provide a lot of flexibility to meet each customer’s needs, but the increased flexibility tends to create confusion as well.
Do business owners realize that there is much more to licensing than agreeing to terms during software installation?
It really helps to sit down with someone who can match a business’s goals with its software needs and then help understand the options. The cost savings of making the right choice are significant. For example, we helped one of our larger clients avoid $5 million in unnecessary expenses. In a small business situation, the impact can be just as great.
RON HERD is Microsoft Practice director for Pomeroy IT Solutions in Hebron, Ky. Reach him at (800) 846-8727 or firstname.lastname@example.org.