Microsoft’s Enterprise customers should already realize that “Team Redmond” is in a desperate rear-guard battle to defend its incumbent monopoly positions in infrastructure software, against the increasingly successful insurgent attacks from Amazon, Google, and an ever-growing list of startups and disruptors.
The ‘softies’, with great fanfare, are using every trick in their huge, complex, ever changing book of tyrannical licensing rules, to push their customers away from traditional licenses for on premise software, towards cloud subscriptions.
Why would one of the richest companies of all time intentionally cannibalize its incredibly profitable licensing business, in favor of a much higher cost cloud hosting business model that is rapidly reaching commodity status? Because they have no choice; if customers are not on Microsoft’s cloud, they will be on Amazon’s or Google’s or someone else’s. And, as the common wisdom goes, once a customer moves their operations to a provider’s cloud stack, it will be very difficult to dislodge for a competitor (more on that topic later).
One example of the pressures being applied to customers: At NET(net), we’ve long been advising our clients that they should expect and plan for regular and frequent software license compliance audits. For the past several years, Microsoft has been building out a ‘Software Asset Management’ (SAM) ‘partner ecosystem’, and clients are now receiving letters from Microsoft, “asking” for their cooperation and participation in a ‘SAM review’. The wordsmithing is top-notch; we must give due credit to Microsoft’s marketing department… the letters leave a typical IT manager with the impression that an audit is anything but voluntary… Microsoft fails to mention that particular detail, but let’s be sure to emphasize the point right here:
Microsoft SAM Reviews are not audits; they are a voluntary exercise.
So, being a good corporate citizen, our beleaguered IT manager client reluctantly consents to an invasive and disruptive ‘SAM Review’ which, coincidentally, is timed to complete just before the renewal of existing but expiring Enterprise Agreement, or other volume licensing agreement.
Then what happens? In the many cases where NET(net) has been involved, we have witnessed a consistent pattern of ill-planned, poorly executed, confusing, and sadly just plain incompetent efforts by the ‘Partners’ contracted by Microsoft to perform these audits. The litany of problems is too tedious to recount, but some low points include:
Motives are a tricky thing to assign to a large corporation; but we are left with the lingering feeling that Microsoft has intentionally engineered this malignant incompetence into the ecosystem, with the end goal of both maximizing immediate revenue from compliance settlements, and using the shock value of huge (claimed) compliance gaps, to force customers into high-cost subscription deals they would otherwise laugh off of the table.
So, our dear overworked IT manager, please don’t go in there alone; bring a guide who has traversed this path many times and will help you avoid the pitfalls and overcome the boogeymen lurking there.
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