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The Almighty Buck

Corporate America Wary of Subscription Software 350

medical_geek writes: "According to this article on cio.com, MS's subscription service is failing in the business world. I guess that personal users are not the only group that balks at paying a yearly fee for software. My question is have you at your job bit the bullet and signed up as an early adopter, or are you rolling the dice and seeing if this experiment fails?" This article focuses only on Microsoft, but the same analysis probably explains why ASPs haven't taken off like they were supposed to, either.
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Corporate America Wary of Subscription Software

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  • by Pengo ( 28814 ) on Friday January 18, 2002 @06:25AM (#2861068) Journal

    We have the same problems in going out to market. We face customers that want to control their own destiny and not completely give up control of their core business.

    I believe that unless the technology is a complete commodity , no company is going to be excited about signing up for something thats subscription and reley their business on it.
    • by Anonymous Coward on Friday January 18, 2002 @08:22AM (#2861327)

      One of the biggest factors keeping companies from adopting the "software as a service" model has been, as you suggest, fear of outsourcing critical business functions to shaky ASP Internet startups. However, in the current economic environment, most "bad" ASPs have already gone away, or are hanging on by their fingertips -- no longer are you seeing people dumping Windows apps over the Internet using Terminal Server and crap like that. It is just not cost-effective.

      Still, outsourced software provides real value in many cases, and companies want it dearly. For example, if you have any idea how expensive it is to pay IT staff simply to support MS Exchange for a medium to large-size company, the costs are huge. Several companies are currently making a living hosting Exchange, Oracle Financials, and other "hostable" commercial software packages because over time it is actually cheaper to pay someone else a flat monthly fee to manage it than to hire your own staff, especially if you are a large organization. Intermedia [intermedia.net] is one ISP I've seen that hosts Exchange, for example.

      Many solid ASPs are also targeting more distributed types of organizations, one of which is Professional Services. Companies such as Portera [portera.com] provide collaboration tools such as online time sheets and expense sheets, as well as document sharing and versioning, all over the Internet through a browser.

      For PS organizations or Contract Agencies distributed around the globe, a hosted application avoids the staggering infrastructure costs that go along with having a global company. Take into account maintaining your VPN gateways, so you can get to varied internal applications, which must also be maintained, plus licensing and support costs, plus hardware/network and you are talking big money. With a hosted app, you pay your flat fee, after which all you need is an internet connection and you're in.

      As for big-money (but new) service-arena players like Microsoft, it seems obvious they are trying to leverage customers into an even tighter spot with this new licensing scheme, without providing real added value. This subscription thing doesn't seem to work very well with shipped products, since you are forcing people to "throw away" something tangible that they feel works fine, and upgrading desktop machines costs dollars not only in licensing but also in the whole loss of inertia in the company with the upgrade (and IT staff). However, as M$ moves more toward providing .NET services we will see them become more successful in selling subscriptions for web services and the like. That is, as long as they don't shoot themselves in the foot with Passport. ;)


      • by gorilla ( 36491 ) on Friday January 18, 2002 @10:04AM (#2861679)
        There is more to the concerns about ASPs than just the chance that the ASP going away.
        1. Features may be added or removed under the whim of the ASP, not the customer
        2. Many businesses don't have enough bandwidth to the internet to be able to perform core functions for all their staff
        3. The ASP application may not be able to be customized for the requirements of the business
        4. Concerns about the confidentiallity the data - will it be sniffed on the internet, or is there a possibility of a bug releasing data

        It seems that you can never make a mistake recommending against an ASP, while you can make one recommending for it. That to me makes it a no-brainer.

        • The points that you make don't really apply. First, number 1 is both a good thing and a bad thing. Ultimately, if a company chooses to disregard its customers' wishes it won't have customers for long, ASP or not.

          Point 2: ASP software needs to use a reasonable amount of bandwidth (no extraneous images, etc.). This is ilke saying "most offices have hard drives that are too small to handle the latest release of office". If ASP software offers enough value, it will be worth businesses' while to upgrade their connectivity.

          Point 3: This is also not specific to ASP software. I've used a lot of un-customizable software, both ASP and non-asp.

          Point 4: Your concern here was addressed by the poster whom you replied to. There were a lot of start-up ASP's that went under and caused people to worry about confidentiality, etc. However, this is not a flaw of the ASP model, merely an aspect of the risk involved with doing business with a small (newly established) company.

          The no-brainer is getting caught up in criticizing the "internet bubble" rather than looking at the ASP model as a good way to solve many of the problems associated with traditional software distribution and licensing.

          • 1 is a bad thing for the customer. They spend a long time training 10,000 users on how to use the software, and suddenly it all changes. Even if it's a great new feature, they no longer have control how their users use the product.

            For 2, you're underestimating the cost of upgrading in an enterprise. If those 10,000 users are spread through 50 offices then the costs of upgrading are huge, both one time and on going. This is very different to the cost of a few hundred hard drives.

            For 3, even the most closed software is still customizable. Our copy of office has had templates added, to give company standard documents and presentations.

            For 4, it's nothing to do with the newness or size of the company. Even the biggest [com.com] company or organization [mycareer.com.au] can have their websites hacked. However, if it is an ASP, then the company which owns the data has NO possibilty of preventing or correcting the problem.

        • How about 5: The ASP will take your data hostage if you refuse to comply with their terms (even if it's stored on your own hardware).
      • Still, outsourced software provides real value in many cases, and companies want it dearly. For example, if you have any idea how expensive it is to pay IT staff simply to support MS Exchange for a medium to large-size company, the costs are huge. Several companies are currently making a living hosting Exchange, Oracle Financials, and other "hostable" commercial software packages because over time it is actually cheaper to pay someone else a flat monthly fee to manage it than to hire your own staff, especially if you are a large organization. Intermedia [intermedia.net] is one ISP I've seen that hosts Exchange, for example.
        How can it be cheaper for you to to hire the staff than it is for me to hire the staff? We both need the same number of support staff to support my users. But now I have to pay for your proffit. For small companies I can see where paying someone else to manage your email severs may be cheaper, but for a large company, where the need is large enough for economies of scale to kick in, I don't see how it is possible for you do do it cheaper and at a proffit.
        • How can it be cheaper for you to to hire the staff than it is for me to hire the staff?

          Economies of scale. Efficiency of purpose. Multitasking off of like tasks.

          What do I mean by all that, you ask?

          Economies of scale: A company which does a lot of a particular thing realizes productivity gains in that thing do to fact that it does this thing a lot.

          Efficiency of purpose: a company dedicated to doing a single thing can often generate specialists at that thing who share knowledge with eachother and therefore become effective at that thing.

          Multitasking of like tasks: One person can do the same kind of thing several different times much better than they can do different kinds of things different times.

          Whether or not this applies to Exchange and so forth I don't know, but it's certainly a proven model when it comes to, say, payroll.

  • by Kirruth ( 544020 ) on Friday January 18, 2002 @06:27AM (#2861078) Homepage
    I think that MS's security problems are what is slowing corporate migration to XP (with the associated purchase of new machines). Many people are finding the good old Win95 or 98 machines they have been using for a few years are no longer quite cutting it, but they can certainly wait a few months for the bug fixes.

    It'll only be when the quality of the software is up to scratch that people will start thinking about its price. In the end, the total cost of ownership of software is much larger than the licence fee: putting in fixes after deployment is terribly expensive.

    • I think the problem is also that subscription services don't also include updates in a timely fashion.

      It's the same crap software for as long as you own it. You would think subscription=updates but it doesn't.

    • by Anonymous Coward on Friday January 18, 2002 @07:45AM (#2861234)
      I'm posting this as an AC to protect my job.

      at AT&T we just started the roll-out to W2K at the middle of last year. All indications have been that XP will not be a part of the corperate environment for at least 3 years, and servers are to still be NT4.0 with Service pack 6a (W2K server offer's nothing so we didnt buy it. and sorry to the MCSE's but it is true, the W2K services are nothing but fluff.) in fact in a teleconference 2 months ago the CTO answered a question about XP, his response was "Dont waste time learning it, we are not going to use it."

      Why spend tens of thousands for something that does nothing and will hurt productivity for weeks after it is released? (Ohh the argument that MCSE's use about linux... well XP confuses users as much now :-)

      major4 corperate
      • At AT&T we just started the roll-out to W2K at the middle of last year. All indications have been that XP will not be a part of the corperate environment for at least 3 years... Why spend tens of thousands for something that does nothing and will hurt productivity for weeks after it is released?

        Of course, these days CIOs are very financially focussed. They'll be like, "benefits: marginal" vs. "costs: uncertain but probably high". Then they'll say to their CEO boss, "to be honest, boss, there's just no justification to migrate yet".

        That's business!

    • by Anonymous Coward on Friday January 18, 2002 @08:32AM (#2861353)
      I don't think the security problems come into the upgrade decision. These are the main problems with upgrading to XP on a corporate level (at least where I work):
      1. It's still too new. Wait for a couple of service packs.
      2. It's too new. Budget for 2002 at the place I work at was worked out last July, no space for XP in that budget.
      3. It's too quick after W2K. We are only just getting around to upgrading to W2K from NT 4. These things take time when you are upgrading several thousand PC's (hw and sw), training all the staff, etc. It's expensive.
      4. The big question though is WHY? NT 4, and particularly W2K, easily provide all you need in an office environment. The W2K upgrade was mainly done because we are suspicious that we will soon be getting software that won't work on NT4, which I suppose is why we will eventually be forced to upgrade again.

      Everyone tech support person I know hates to work on the migration projects. Everyone in the org has an opinion (usually totally uninformed) and the people who have to decide just get hassle from all directions.

      This upgrade hysteria has got to stop. It's costing far more than its worth.

      Just my 2 (euro) cents.
    • by kinkie ( 15482 ) on Friday January 18, 2002 @09:02AM (#2861442) Homepage
      It's neither imo.
      The problem is that WinXP adds nothing to Win2k from a corporate point of view.

      The new GUI? No use, since the older one is known by the users since 95, and the new one can be disorienting, despite Microsoft's claim of the contrary. Re-training is expensive.

      Movie Maker and Media Player? Puh-leeze, Windows installs already enough time-wasting stuff on the OS without needing those.

      MSN Explorer? Many businesses restrict access to the Internet, why would they allow looking at MSN?

      .net? Pure vaporware so far as far as real-world applications go.

      Internet Explorer 6? It doesn't offer much over Internet Explorer 5.5, which is already widely deployed, and besides it's just a download and remote installation away.

      Server-side, WinXP is just not there(TM), and it offers a total amount of nothing over win2k.

      Also, software compatibility is still to be tested.
      • "The problem is that WinXP adds nothing to Win2k from a corporate point of view."

        IMHO, file encryption that doesn't restrict file use to just one user is pretty damned nifty, if not useful.
  • XP Rollouts (Score:3, Interesting)

    by Anonymous Coward on Friday January 18, 2002 @06:42AM (#2861120)
    My company is about to do a rollout to a company of about 50 users. We are telling them to go for Win2k rather than XP, purely because of all the driver problems we are having on our test systems.
    They want a fast rollout, with minimum hassles.
    Windows XP cant offer that right now.
  • by Dog and Pony ( 521538 ) on Friday January 18, 2002 @06:45AM (#2861125)
    That is, if you subscribe to these upgrades, you kind of feel you will have to upgrade when something new comes along, even though you do not have to. That takes time, especially in larger offices/companies/megacorporations. Time often much better spent on actually getting some work done. Hehe. No, I don't speak of necessary patches and such - although that is a huge cost (in time) when dealing with MS products too.

    So there is no reason at all to subscribe for the newest software, I would upgrade when I must (or when it pays off in better efficiency). I really understand why these big customers don't want to have their IT administrators get their timetable from another company (MS).

    And I really understand those that see a bit further and refuse simply because they don't want to be (even more) locked in.

    • by flacco ( 324089 ) on Friday January 18, 2002 @07:00AM (#2861153)
      if you subscribe to these upgrades, you kind of feel you will have to upgrade when something new comes along, even though you do not have to. That takes time, especially in larger offices/companies/megacorporations.

      It also cripples the utility of MS work-alike software like SAMBA. If you have your desktops on mandatory upgrade, MS can break SAMBA connectivity at will. Thus using a non-MS implementation of the protocol becomes a LOT riskier. You can't just hold off on desktop upgrades until you (or the SAMBA team) figure out what to do.

  • by Agent Green ( 231202 ) on Friday January 18, 2002 @06:46AM (#2861127)
    I won't buy into a software subscription service for my software for a few reasons:

    1.) I can use a given software packages for years at a time...for me, SecureCRT comes to mind, though my license won't support any of the downloadable versions.

    2.) The overall cost of subscription is higher. My company's official office software suite is STILL Office 97. Not that there's anything wrong with 2k or XP, but 97 gets the job done...and it's already paid for.

    3.) But the big thing is what happens when a product becomes unsupported? Does the program up and quit and force an upgrade, possibly bring a screeching halt to whatever business process you working on at the time? Does the program send off a little message so the marketing drones relentlessly pound on my phone line, reminding me to renew? Are all my data files locked out?

    Even though the initial cost is higher, I much prefer to just buy my software. Unfortunately, subscription is pretty much here...it's in every program that requires an Internet connection to "activate" their products. It's not confined to Microsoft Office anymore...it's just a "lifetime" subscription thing to start getting us used to the idea.
    • by Anonymous Coward on Friday January 18, 2002 @07:05AM (#2861161)
      Apologies for posting as AC - can't remember my password.

      You forgot #4 - what happens when the software company goes out of business? If your business revolved around their subscription-based software, then you're pretty much hosed unless you don't mind "warezing" it somehow (which isn't exactly recommended for a BUSINESS). You're pretty much tying your future together with that software company. Not a very comfortable position to be in.

      I'm sorry... but I'm just not going to buy into any subscription-based software. Unless it's something that's absolutely completely new and hasn't been done before, I can always buy old software that gets the job done. Who _really_ needs Office XP when 97 gets the job done, like you said?
      • This is one reason ASP works well only for big companies, like the big bank I work for. The contract for any ASP software we buy provides for code escrow, and us getting a copy should the provider go bust.

        In addition, if the provider looks dodgy (e.g. Cygnifi) we will demand financial backup, or walk away from the deal.
  • by LinuxParanoid ( 64467 ) on Friday January 18, 2002 @06:56AM (#2861141) Homepage Journal
    Just remember, when you are subscribing to a service, rather than purchasing an upgrade, you have a lot less leverage as a buyer to control your costs. The CIOs, mostly managers of 'corporate cost centers', obviously recognized that.

    Second, the technological rate of progress for a service provider will always be slower because its so much easier for the vendor to retain its existing revenue base than to take the risks of developing new products. For example, I predict that the more you see Microsoft switching to a subscription-based software business model, the less focus you'll see on features (needed to get new business) and the more focus you'll see on risk-averse issues (like security and availability) to insure nothing rocks the revenue boat. Oh wait, Microsoft just announced that, didn't they?

    • Less focus on features sounds good to me. Windows for Workgroups 3.11 had all the features I could use -- except true 32 bit operation, long file names, and stability. Win 95 gave 1-1/2 of those 3 points (all the 32-bit operation that was possible while keeping compatibility with DOS applications), NT 4.0 gave two of them, but we're _still_ waiting for stability.

      As far as desktop OS and office apps are is concerned, I don't think anyone wants more features. Fewer features and all of them working would be an improvement.

      Maybe server OS's need more features -- but even if all the security holes and instabilities resulting from patches piled on patches were magically cured, Windows is never going to be a good server OS as long as software installations require re-booting. Unix boxes often stay on-line continually for years, even while installing updates to the OS. That's the up-time mark you should shoot for if you want to be in the server business, and MS wasn't even trying for 20 years.

      You think they will straighten out because of a letter from Gates, or even a month of re-training. It's like taking a 20 year old fat kid whose hobbies are eating chips and watching TV, and training him for the 4-minute mile!
  • Just subscribed (Score:2, Interesting)

    by duvel ( 173522 )
    The company I work for is in the proces of upgrading al PC's (about 1500). The choice has been made to go for WIN NT for several reasons:

    Stability: it's better than the WIN3.11 that a lot of users have now

    Software Price: it's a LOT cheaper than what MS is charging for WIN ME etc. Subscription in itself is not really a problem (we have a few mainframes and IBM's software is mostly subscription based, but that usually includes upgrades and consultancy).

    Total cost of ownership: It can be run on 'slower' hardware than what's needed for the newer flavors of WIN. It's also upgraded less frequently (upgrading 1500 PC's is a lot of work and therefor expensive).

    PS: We also checked out Linux. The (sadly enough) only reason not to go for that was the (at that time) lack of support for MS-fileformats.

    • This post has GOT to be a joke. 3.1 up to NT??? Only reason not to go to Linux is a lack of support for MS-fileformats? let me guess - you mean OFFICE file format? This is NOT a barrier!! Your techy peeps are NOT very good sadly *sigh* Another sole lost :)
      • ``is post has GOT to be a joke. 3.1 up to NT???''

        Are you really surprised that someone might still have been running Win3.11? I used to work for a (small, privately held) company that I'd be willing to bet still has some PCs around that are running 3.11. If fact, I'd bet that the only PCs that they have that are running Win95 or higher are those that had it preinstalled when they bought the box. Some companies are so tight with their money that they'd never see the benefit of buying upgrades (and keeping BillG happy by using only the latest Windows OS) because the app they're using is still working fine with the old OS.

        • > Some companies are so tight with their money that they'd never see the benefit of buying upgrades (and keeping BillG happy by using only the latest Windows OS) because the app they're using is still working fine with the old OS.

          And as long as we're on the subject, Win 3.1 runs fast on a fully-depreciated Pentium-class machine ;-)

          I can think of a lot of dedicated applications where moving from 3.1 to 95 or NT wouldn't add value. Yes, Windows has changed a lot in the past 10 years. But has your corner store?

  • by electroniceric ( 468976 ) on Friday January 18, 2002 @06:58AM (#2861147)
    How can it not be illegal for a company (which by any measure is either a near-monopoly or monopoly) to demand (*) that you refuse to consider any other product in exchange for (**) not raising prices?

    Trust: [dictionary.com]
    8. A combination of firms or corporations for the purpose of reducing competition (c.f. *) and controlling prices (c.f. **) throughout a business or an industry.

    Surely someone here can help me resolve my confusion.

  • Irony (Score:5, Informative)

    by LinuxParanoid ( 64467 ) on Friday January 18, 2002 @07:02AM (#2861157) Homepage Journal
    Ironically, the reason why CIOs feel empowered is that they probably have most of what they want out of their PCs; they're "good enough". Improvements post-Win2000 and older Office suites don't look that compelling. So why lock yourself into some unnecessary upgrade stream?

  • by hs81 ( 62329 )
    At the moment with the economy on a backstep Microsoft has chosen the wromg time to start the push to subscription based software. It does not need a PHD to work out that the fundamental reason for this is to increase the revenue stream from its users. (There is a nice analogy here with pushers and drug users here but i'll leave it for now)
    However, there is a major bonus for the open source movement as commercial interests are now looking to reduce their exposure to MS. Consequently, Linux is gaining more credibility as an alterantive O/S within the mainstream business markets.
    Frankly, I'm all for MS pushing the subscription based model as hard and as fast as possible but I don't own any MS stock and I do care about the open source movement.
  • by hacker ( 14635 ) <hacker@gnu-designs.com> on Friday January 18, 2002 @07:19AM (#2861189)
    ...the combination of the following things:
    1. Microsoft's "Lease your Operating System" subscription services
    2. The frequency of Microsoft's egregious security violations
    3. The impact of the September 11th attacks on our economy
    4. The dot-com crash of last year
    ...are doing wonders for furthering Linux adoption in businesses and personal use. People don't have as much cash anymore, either because they need to use it to pay rent and buy food, or because they're unemployed. Business are working with less staff, and have to keep afloat. Businesses are auditing their "licensing" habits, and seeing how many millions they spend just to keep insecure Microsoft software running, when Linux (or BSD, et al) is a completely viable alternative. Even full-screen vmware runnung Windows under Linux is more stable than Windows natively (though now you're back to paying for licenses).

    Just a thought.. but Linux Just Makes Sense more and more now-a-days, even if in some cases, it is less capable than the Microsoft alternative.

    • "...are doing wonders for furthering Linux adoption in businesses and personal use. "

      Not really.
  • XP Reject? (Score:4, Informative)

    by Sobrique ( 543255 ) on Friday January 18, 2002 @07:20AM (#2861191) Homepage
    My company is in no rush to adopt XP. At the current time we're sticking with NT4 (some 2000). The reason is quite simple (and two fold) - the overall cost over the 'product lifespan' is significantly more. If you buy a copy of NT, then you own a copy of NT (or site license). It will remain 'valid' for several years (5 or so) and is a one off cost. Even better is the fact that when we buy a new PC this is included as the Redmond tax and thus is an 'invisible' cost to the business.
    (No I don't like this practice, but the company as a whole does)
    The other reason is the difference between capital and ongoing running costs. If you are renewing an XP license each year, your _service_ cost increases per desktop. As an IT department, we don't care, but our users definitely do.
    The 'capital expenditure' of buying a new workstation and a copy of an OS goes into a different 'budget bucket'. It makes it easier to explain as 'we need to buy a PC and a copy of windows' rather than 'We need to buy a PC, and then we need to pay for a license for it each year'.
    I'm really hoping this master plan of microsoft is going to fail. IT is the same situation as ASP - software developers want to have a steady income, but end users and companies see it as a 'I pay x bucks for your product'.
    As long as any software distributer is selling 'forever' licenses, few are going to opt in to an ongoing fee service (IMHO).
    • Even M$'s licences are not 'forever' licenses.

      Win 95 is no longer supported by them, and NT will be unsupported soon as well.

    • If you are renewing an XP license each year, your _service_ cost increases per desktop. As an IT department, we don't care, but our users definitely do.

      But this isn't in place yet, is it?

      I mean thats hypothetical. I work with XP (at work), and its not subscription based as far as i can see.

      It would make sense to be subscription based IF Windows XP costed X and the yearly rate was X/3 or X/4. Typical businesses use the software for three or four years. Use it less, you pay less for the software. Use it longer, you pay more. Not a bad idea, in essence.
    • What the hell are you smoking? XP is not sold on a yearly-renewal license. XP's licensing scheme is no different from NT4s.

      I guess the real reason XP is failing is because uninformed idiots like the parent poster are running the IT departments.
  • Big companies are reminding me more and more of great, stupid, predatory animals. They fish the seas dry, annihilate competition, and chew down more of their prey each time. There's no intelligence, no forethought, it's all one-way traffic, with consumers as food.

    When a predator gains an overwhelming advantage in a natural system, they typically exhaust their entire food supply, which in turn triggers their own extinction. I suppose this is what comes from skipping those elective natural science classes to focus on your MBA.
  • Microsofts licensing charges are proportionally steeper than the software systems we have.

    Also licensing, typically, gives you technical support and escalation facilities.

    Will we be able to ring them when things break?
  • by srichman ( 231122 ) on Friday January 18, 2002 @07:33AM (#2861217)
    ASPs haven't taken off like they were supposed to
    I think the ASP model is thriving and will continue to thrive for applications that demand it, and will be adopted slowly for other applications. The predicted ubiquity of the thin client definitely hasn't come to pass, but you have to acknowledge the ASP successes where the model was a good fit with the application.

    eBay is one of the most successful ASPs on the Internet. Sellers seem to have no problem paying a per-auction fee to eBay for hosting the auction application. You can imagine an alternative where everone paid $10 for an eBay application that sat on their Windows desktop and did a P2P search of current auctions by communicting Gnutella-style with the other eBay applications. It would suck. The ASP version kicks its ass any day of the week.

    Similarlly, I used to work for a company with an ASP remote access application [gotomypc.com]. To circumvent firewalls that only allow outbound connections, the company routes all connections through their servers; there's no other way to do it if you want to support connections where both endpoints are firewalled. Hence, ASP. It's easy for me to justify paying a monthly fee to use this service because the application demands it. I have to use their servers. (The company includes free support and free upgrades with the subscription fee, too, which makes it rather more attractive than Microsoft's licensing scheme.)

    As for ASP MS Office... At this point, my reaction is, "What's the point?" In the absence of ubiquitous thin-client computing, I can't see at all why I'd want to pay for a subscription. There's no value in an ASP model for lots of applications, include most of Microsoft's (with obvious exceptions like Hotmail).

    ASPs didn't fail. They just succeeded where it was logical for them to succeed.

  • by Epeeist ( 2682 )
    You can't grow your market. If you can't grow your market, then how do you increase your revenues? The only way is to change your pricing structure. Since you are a monopoly everyone has to cough up (or at least that's what MS thought).

    Unfortunately for MS it seems to be inducing people to look for alternative ways of reducing the money they pay. This is the time to do some evangalisation folks!
  • by ayjay29 ( 144994 ) on Friday January 18, 2002 @07:42AM (#2861230)
    I was originally very sceptical of subscribing to software as a service. The tools I use every day (Dev Studio etc), I would like to buy on CD, install on my box, and keep.

    I am starting to move towards the idea now. A couple of weeks ago I wanted to play around with some images in Photoshop. I had to find the CD, install it, use it for an hour or so, then uninstall it. It's not worth paying several hundreds dollars to do this, so most people won't bother. There are quite a few apps that I will want to use a couple of times a year, or once a month.

    With a subscription based system my company could have an account with say, Adobe. When I need to use Photoshop, I go to the website, and use it as a service, and the company gets a bill at the end of the month. It's simple.
  • by Raetsel ( 34442 ) on Friday January 18, 2002 @07:43AM (#2861232)

    Good department. Certainly appropriate.

    We're talking about a company here that wants to milk as much money out of its' customers, with the least effort required.

    They're certainly working well toward that goal -- look where we are now!

    • We have a 'server' OS that differs from the 'Ooo, SHINY!' home version by virtue of just a few registry settings!

    • (Why does a server need Media Player, DirectX, Active Desktop, and all the other home-version 'shell-upgrade' tweaks, anyway?!?)

    • Microsoft will accept NO liability for its' software, neither for fitness for purpose, the accidental destruction of your company, or the surreptitious mailing of your anti-government rants to the FBI.
    • Two words: Product Activation. Once upon a time, the MS Office license actually allowed you to install it on your home & work machines. Gee, Microsoft sure is a nice company! They're cute and cuddly, too! Now that everyone's used to it, all of a sudden we have to pay for every copy -- you can't tell me that wasn't a patiently engineered plan.
    If Microsoft wants to make subscriptions attractive, offer something in return -- we already get all the benefits of WindowsUpdate, are they going to take that away? What is needed is a guarantee of fitness for use, stability, and timely repair of problems. And by timely, I mean 'timely from the customer's definition', not Microsoft's!

    If I go to Ford and buy a dump truck, I am guaranteed that it will haul N tons of material, or N cubic meters, whichever is less. If I bought a 10-ton truck, and the wheels fall off when I put a 5-ton payload in it, I can sue.

    Apply this comparison to Microsoft: I purchase Windows 2000 Server, Exchange Server, and the recommended hardware to run it on, and when it fails at half the advertised max load, Microsoft will gladly bill me for a support incident to tell me I need better hardware! ...And there's nothing I can do about it.

    I know this comparison isn't perfect, but it certainly makes the point. I know a lot of companies are sick and tired of buying something advertised as suiting a particular purpose, only to find it lacking.

    If the subscription allows me to hold MS accountable, I'm interested. Otherwise, forget it.

    • "Microsoft Licensing 6.0 was a seminal idea"

      translation- "Microsoft Licensing 6.0 wants to cum on your face"

      ...eek! forget it! ;)

  • Volatility (Score:2, Insightful)

    by Epeeist ( 2682 )
    We have just removed a program that has been in service for some 30 years on our mainframes. It has been modified, upgraded and bug fixed in that time, but it has been in constantly in use over 3 decades.

    We want a similarly stable service on our other systems, including desktops. Admittedly we don't necessarily want the same software lifetime. But given that we have some 50,000 or so desktops we don't want to be patching or upgrading the software on them very often. It takes a lot of effort to plan and install a new piece of software across all our desktops.
  • The guy claims, he's gonna be charged an extra $8 million for upgrading everyone to the new office?

    Just think what sort of an OpenOffice you could buy for that money. That would pay 30 programmers for 2 years, and once that money was spent, you could have as many copies as you like.
  • by NewbieSpaz ( 172080 ) <nofx_punkguy.linuxmail@org> on Friday January 18, 2002 @07:57AM (#2861268) Homepage
    At my place of business, we develop VB applications (no flames please) that we use internally to control inventory, and to track units that we produce, as well as write test software to well, test our product before it ships. Besides running windows 98/NT/2000, we've decided to start converting our software over to Linux, writing in pure C, and using MySQL for databases. OK, I know this seems OT so far, but my point here is that we are doing all of this to avoid using XP and any other upcoming versions of MS windows. We have decided that we will do our best to make sure that 2000 is the last version of windows that we will ever buy, at least in our department. We've already been using Linux on servers within our department for about a year, using apache to run a simple intranet server, and have samba up doing file and print services. Since some of the brass have found out about our 'secret' of having high availability linux servers, they were intrigued and like the direction we've taken thus far. Hopefully we can avoid XP all together, and write software that can potentially be useful forever, by writing it for an OSS platform.
  • by Rogerborg ( 306625 ) on Friday January 18, 2002 @07:57AM (#2861269) Homepage

    ...I'm using a company machine with WinNT 4.0 SP6a. With a "Windows(R) 2000 Professional 1-2 CPU" sticker on the side. We downgraded it, and for a very good reason.

    It does everything that I need to do my job. It does nothing that I don't need. The issues are known. It doesn't require any more patching because it ain't broke, or it's broke in known and acceptable ways. It doesn't require our IT guys to have to ask what version of what OS I'm running, nor to hunt out the right ghost image for that combination of hardware and OS. It can be ghost installed or copied, which is vital for replicating software builds.

    Windows 2000 would be a barely acceptable substitute. There are far too many unknowns with WinXP, plus it has that habit of knowing better than you what drivers you really want to use (I need to test beta drivers, for god's sake, give me an "I know what I'm doing" button!).

    Windows.NET would be absolutely, utterly unworkable in a business environment, because neither I, nor our IT guys would know what exactly was on the machine, nor would it be possible to replicate that at a later date to reproduce a build exactly.

    We cannot and will not upgrade to .NET. Ever. As application support for NT dies away at the same time as Linux support grows, it's looking like a better (corporate!) proposition every day, and not just in the server room.

    • by Otis_INF ( 130595 ) on Friday January 18, 2002 @08:30AM (#2861346) Homepage
      I to use NT4 on some servers, just because they host websites and do that for a long time now and if it aint broke, don't fix it. However, Win2k brings new stuff to the plate, which you haven't touched according to your story. F.e. fully automated software installation/controll via AD using easy scripts. Windows.NET server will make this even easier. What you say about it wouldn't be workable is so far off the truth it hurts. Why? Because it has f.e. the checkpoint tech that's also in XP: you can roll back to any state you want: with the registry, with the drivers etc.

      At ABN-AMRO, one of the worlds largest banks, they totally run on win2k and use an inhouse developed softwarecontrol/distribution system, based on AD and VBScript. Everything can be and is controlled from a central point in the WAN. Not workable? ha!. Perhaps you should kick your IT-guys in the butt so they finally get their head out of their asses and read the course material they received at the courses they attended to.
      • by Rogerborg ( 306625 ) on Friday January 18, 2002 @09:05AM (#2861451) Homepage
        • Win2k brings new stuff to the plate, which you haven't touched according to your story. F.e. fully automated software installation/controll via AD using easy scripts. Windows.NET server will make this even easier. What you say about it wouldn't be workable is so far off the truth it hurts. Why? Because it has f.e. the checkpoint tech that's also in XP: you can roll back to any state you want: with the registry, with the drivers etc.

        I'm not talking about servers, I'm talking about desktops. Desktops get moved around, recycled in different roles, and there's a lot of them, not all of which can run 2K let alone XP or .NET.

        Managing 2 OS's, let alone 3 or 4 would increase the workload (and cost to us) of our IT guys. And rolling back an existing install is not the point. The point is that when a bit of my box fries (which it's done once), with half an hour I'm using another box from the same manufacturer (faster CPU, but same components) with a ghost of exactly the install of NT4 6a and apps that I was using ('cause I wasn't dumb enough to screw with my old box), and I and the IT guys know what's on it, and the box doesn't then try and second guess me and upgrade itself. Ever. If I can't get a recycled box with the same hardware, I can get a mostly equivelant (but known) ghost image on a newer box, or (worst case) we can start with a new box, rip whatever it comes pre-installed with, install it up to a known state that's not far off a ghost image in terms of repeatability.

        Yes, we can do that with 2K. We can do it with XP - if we're careful. But with .NET and son of .NET, it's going to get harder and harder. I'm not saying we can't do it, I'm saying that it may become more trouble than it's worth, and it will push us into using alternatives.

        I should make it clear that I develop and maintain telecomms software that's been in the field for years. When I have to fix a bug in software that was built 5 years ago, I need to replicate the original build environment exactly, no surprises, no enhancements. I previously worked in the nuclear industry, where this was an absolute requirement. We had 20 year old machines in storage that had to be maintained to replicate builds, and a firesafe packed full of complete OS and application tars to wipe these systems and put them in a known state.

        Our problem is not one of administrating and updating a network, it's of stopping it being updated. That's a very real need for some developers.

    • What is this? Babbling nonsense day on slashdot?
  • I am not going to debate with anyone whether this is a major reason why DEC (Digital Equipment Corp.) failed... but I believe it was part of it. I worked for the US Gov't in the late 80's and we had a lot of VAXes running VMS. EVERY STINKING YEAR we had to pay money to upgrade our licenses.
    This idea came and went, and I for one am personally very happy that Micro$oft has chosen such a moronic policy that has, in part, caused other companies to fail. Here's to your self-inflicted demise, Bill!!! "Have at it, and good luck!"
  • by WildBeast ( 189336 ) on Friday January 18, 2002 @08:24AM (#2861330) Journal
    Even Eric S. Raymond agrees with MS on this one :

    "It is also worth noting that the manufacturing delusion encourages price structures that are pathologically out of line with the actual breakdown of development costs. If (as is generally accepted) over 75% of a typical software project's life-cycle costs will be in maintenance and debugging and extensions, then the common price policy of charging a high fixed purchase price and relatively low or zero support fees is bound to lead to results that serve all parties poorly.

    Consumers lose because, even though software is a service industry, the incentives in the factory model all cut against a vendor's offering competent service. If the vendor's money comes from selling bits, most effort will go to making bits and shoving them out the door; the help desk, not a profit center, will become a dumping ground for the least effective and get only enough resources to avoid actively alienating a critical number of customers." - Eric S. Raymond

    This is taken from The Magic Cauldron [tuxedo.org]
  • by JTFritz ( 15573 ) <jeffreytfritz @ g m a i l .com> on Friday January 18, 2002 @08:36AM (#2861369) Homepage Journal
    I work for an ASP in the financial sector located outside of Philadelphia. I'd like to say for the record that not only are we surviving the dot-com crash, but we are doing quite well.

    Even through the September 11th disaster and financial woes that followed, our firm thrived and actually had sales INCREASE during that time.

    The trick to us being a successful ASP is that we have an extremely driven sales department, and a very adaptable product that can be modified to suit any user's needs. We fill a niche with industry knowledge and expertise that is quite valuable to our customers.

    Please don't lump companies like mine in with Dr. Koop dot COM!
  • Many successful software companies charge support fees in addition to a flat fee for the software itself. Sometimes the support contract is mandatory to obtaining the software. This really amounts to the same thing as M$'s deal, but the way Microsoft does it has more of an unsavory feel, doesn't it?

    Why is that? Conceptually, we know that any given piece of software is only going to last a few years (without an upgrade) before it becomes irrelevant. Wouldn't it be easier to just pay an annual fee and always get the latest and greatest without having to worry about it?

    But, I guess it is the idea of personal choice, and the fact that it's cheaper only if you were going to get every single upgrade with no break in between.

    Perhaps they should just return to sold software and support contracts.
  • by fungai ( 133594 ) on Friday January 18, 2002 @08:42AM (#2861388)
    I'm an IT Manager, and also opted not to take the Software Insurance offer. For one it meant that we'd have upgrade (or at least buy the licenses) all our MS products to latest version. All the NT + Exchange + SQL CALs, and then Windows + Office + Project... It adds up quickly.

    But my main point that I wanted to make is that it's just plain unfair. Microsoft want you to pay them even when you *don't* want the latest and greatest. (And 95% can life without it... If some people think StarOffice 5.2 is good enough ... :-) But if you don't take software assurance then you can't just upgrade down the line. You have to pay the full purchase price. Which is all fine and dandy, except that they didn't write the product from scratch, they built it on top of older versions. And you already paid them for the intellectual property in the previous versions, so why do it again? Upgrade in the older, normal sense is much more fair, since you only pay them for the added value... when you need it.

    Pardon the rant.
    • And you already paid them for the intellectual property in the previous versions, so why do it again?

      Well, Linux and Open-Source software put you in the same boat. You paid $0.00 for the original version and they force you to pay the FULL PRICE OVER AND OVER AGAIN FOR EACH MARGINAL INCREMENT! And there are a lot of available increments. Someone think of the children!
      • Linux may be bad, but FreeBSD made me pay *TEN TIMES* as much for the upgrade as I paid for the original software.



  • by f00zbll ( 526151 ) on Friday January 18, 2002 @08:46AM (#2861395)
    As some people know, the subject is a core value of Microsoft. Not "build quality software, provide the highest value to the customer, revolutionize the world." That type of core value will only get a company so far, because at some point, maximizing share holder value is in opposition to the long term health of the company.

    Because microsoft measures value based on increasing revenues each year, maximizing share holder value means shorten the product cycle from 2-4 years to 1 year. From a share holder perspective, it's great. A rapid product cycle is a good thing for share holders because it means you're getting more repeat business more frequently.

    From a user perspective, a certain level of product stability is necessary to create a sense of value and reliability. If the product cycles at a faster rate the customer is comfortable with, the company begins to loose business. Think of a can opener. What if every can opener was only good for 10 uses and it would break. No one would buy can goods or can openers. Food manufacturers would use some other container, like a jar instead of cans. It doesn't matter if the can opener is only 2.00. No one wants to buy a new can opener every week.

    Microsoft is not immuned to the same market principles. Making a product too good or really poor isn't good for the company, consumers or the economy. Back in the 80's Honda found a good way to make bearings in such a way that they would last 30-50 years. Well guess what. Honda stopped using them in cars because they were too good. Using those bearings in cars made them way too reliable and was hurting replacement parts sales. There has to be some middle ground where corporate and consumer needs are in balance.

    Microsoft may or may not realize it before it is too late.

    • Someone says, Because microsoft measures value based on increasing revenues each year, maximizing share holder value means shorten the product cycle from 2-4 years to 1 year. From a share holder perspective, it's great. A rapid product cycle is a good thing for share holders because it means you're getting more repeat business more frequently.

      As a M$ shareholder, I beg to differ. When they were selling product in the normal way (with perpetual licenses and no asinine "activation"), my shares were worth $135 or so, and split fairly regularly. They bombed down to around $40 because of the DoJ thing and the general dot-com slide, but that's become a non-factor -- by now everyone knows M$ is going to get away with whatever they want, and the dot-bombs have all long since detonated.

      IMO the biggest reason M$'s share price has not rebounded (and is still hovering at about $60 and hasn't split in ages) is NOT because of ongoing fear about M$'s future under the DoJ's eye, but because subscription licensing, WPA, the overblown cost to value ratio for WinXP, and similar bullshit, have degraded the value of M$ where the real money is, in the corporate purchasing dept.

      So as a M$ shareholder, this nonsense is COSTING me money. It sure as hell isn't doing anything positive for my stock value!

  • Autodesk has been trying to do this this with AutoCAD for the past couple of years. The reason that it has met resistance there is the fact that every other realse has been a failure (Release 11, 13, 2000). I am worried that they will upgrade a good release with a bad one.

    They say that they will have a way of backing out of the subscription upgrage. I just want to make my drawings they want a steady stream of money. Maybe I could pay them to leave AutoCAD alone.
  • by SerpentMage ( 13390 ) <[ ] ['' in gap]> on Friday January 18, 2002 @09:06AM (#2861455)
    My wife works for a large investment house. And they have not bought into this scheme. They are now thinking about deploying LINUX. This is done for two reasons:

    1) Put Microsoft in its place
    2) Test LINUX and see if it actually is usable.

    I think now is a good time to show how good LINUX is. Corporations have the ear of the other software vendors.

    Interesting that Microsoft always said they would never make the mistake that other corporations did when they got large. True they did not, but they are making their own mistake. It is not arrogance, but "Microsoft rightness". I bet this will make interesting business case in the future.
    • My wife works for a large investment house. And they have not bought into this scheme. They are now thinking about deploying LINUX.

      Don't dismiss this as a troll, I have a few legitimate questions about this strategy. So the corporate stuffed-shirts decide they don't want to pay for a subscription based scheme.

      1. Isn't that what they've been doing anyway for the past 10+ years? Sure, maybe you skipped the 3.11 "upgrade", or maybe you went from 95 straight to NT4 or whatever. But you've likely been paying a yearly fee for a) support and b) upgrades already.

      2. What will happen when the suits realize that open source isn't really free (beer). In a corporate setting, there is quite a bit of support that has to go into the software. I wonder how many IT departments are really going to want to put programmers on their staffs to do bugfixing in deployed apps; especially for apps that are deemed mission critical and where the developers might not be able to produce bugfix turnarounds that are needed.

      3. Will the sticker shock of retraining hold these guys back? I hope not. They should realize that their people have had to constantly retrain with the constant stream of "upgrades" which generally include large changes that users have to retrain to be able to fully take advantage of.

      With that said, I think there are several opportunities. Companies like CoSource and SourceXchange (I may be screwing up these names) haven't really fared so well, but the concept may gain strength. As I mentioned above, companies deploying open source across a large corporate network may want to place programmers that are familiar with the internals of various apps on retainer to be available for making bugfixes to those apps. Hell, some may even be willing to underwrite certain pieces of the project like webhosting/cvs/bugzilla/etc. There's also an opportunity for trainers as noted above. Finally, they might realize that they can get a greater deal of customization out of using open source, especially if they're already underwriting portions of the development.

  • by Phil the Canuck ( 208725 ) on Friday January 18, 2002 @09:20AM (#2861489)
    We're jumping head-first into Microsoft products here, at a non-profit operation. Office XP alone will cost us several tens of thousands of dollars (US) per year. All this while we're being told there's no money. All this despite the fact that I had prepared an alternate path that relied on open source and free (as in beer) software which met all of our needs. Why? Because the executive committee, or at least the only one on it with a backbone, decided that anything that is downloaded is bad. Never mind the fact that I countered that by saying that all of the software required could be acquired without download. Unfortunately, there's still a mindset among the people who write the cheques that Microsoft is the best option. So they'll shell out $50,000 per for Office, while their underpaid staff continue to leave to work for better managed companies.

    This is the second time since I started working here that management hasn't followed my recommendations. The first time was a disaster. Hmmm, let's peer into my crystal ball...
  • by biglig2 ( 89374 ) on Friday January 18, 2002 @09:59AM (#2861654) Homepage Journal
    If you rent software, it's on the books as an expense.
    If you "buy" software, it's on the books as a Capital Expenditure, i.e. an asset.

    Soooo, given a choice which one will the bean counters choose?
    • Ah, but you don't BUY software do you? You liscense it!!

  • by ipxodi ( 156633 )
    Someone should tell the antivirus companies that subscription doesn't work.
    It completely pisses me off that now I have to essentially "repurchase" my anti-virus software every year or two in order to keep getting auto updates. (Yes, I can manually update the AV data files, but that's a pain in the ass in a multi-user environment of any reasonable size.)
    Remember when you bought your AV software once and got updates for ever?
  • If you were a corporate exec: which would you rather do?

    (A): Give up control of mission critical services to a third party thats only interest is to increase the bottom line.
    (B): Keep it in-house, so you can keep your eyes on it.

    Most corporations realize that it isn't wise to let important company services be controled by an outsider.
  • by rnturn ( 11092 ) on Friday January 18, 2002 @11:50AM (#2862389)

    ...between this subscription model and one where you have to renew your license annually else the software stop working? Well, IMHO, beyond being potentially more ``fine-grained'', not much. We were using a software package that required that we receive new license keys from the vendor each year. The package was expensive and any delays on the vendor's side in processing your paid invoice and getting the keys out to the customer were not considered to be their problem. I've worked at companies that were held hostage by vendors like this. In one case we were able to tell them ``No thanks'' when it came time to renew since their software wasn't Y2K compliant and the version that was would have required a whole lot of other software to be upgraded. And there were a whole lot of reasons why this wasn't possible. (As it turned out, this vendor's software could be replaced with a Perl script that provided the 99% of the functionality that people actually used.)

    Businesses are going to look damned hard at any model that potentially halts their ability to function because of billing problems, communications delays, etc. It's one thing to have to subscribe to a support service so that configuration issues, bug fixes, etc. can be solved. But having to open up the check book just to be able to continue writing documents, doing spreadsheets, etc. just isn't going to be popular. And especially if it requires that proprietary business data actually have to reside on someone else's computers.

    Just my US$0.02...

  • I work for a fortune 500, whom will remain unnammed.[But I will say we make power tools, lots, and everyone has heard of us.]

    We are very in bed with MS software wise, much to my chagrin.

    A few months ago MicroSoft was in pitching to us that we should upgrade from NT4 to WIN2k for our network & desktop machines.

    The sales guy's pitch was that if we did it *NOW* it would only cost us $200k more a year on our annual subscription fees, if we did it now - or $700k more a year if we waitied till our licence expired. [At which point 1/2 the people in the room blinked .. because this was the first time they heard we were going to be PAYING a subscription fee annualy!]

    Keeping in mind how in LOVE with MS our support team is .. they actually started to consider an open source solution. [the 2 camps are digging trenches now.]

    The scarey part is that MS was using a simple drop close .. "do you want to pay 200k or 700k" and totally ignoring the new policy where you have to pay an annual fee on NT which was written in 1993.

    The guy was REALLY pushy .. and seemed desperate to me .. now i know why .. we would have been a fairly well branded chip to show people that this was how big business does things .
  • A few months ago, inspired in part by Slashdot, I decided to try and bring some order to my websites. Instead of maintaining everything locally, I thought it would be cool to learn Perl and write a few basic scripts to manage things. The scripts worked OK (most of the time) but I discovererd that I just didn't like synchronizing from server to local. I was more comfortable syncing the other direction, and I liked the idea that my local copy was "the master".

    Now, this is with scripts that I wrote, on a server where I have control of my data, on websites that are just for fun, and I still didn't like it.

    I had suspected this before, but the experience confirmed it. At that point I have to ask myself, "Why am I willing to let Slashdot control my posts?". The only answers I can come up with are:

    1. I was preconditioned by USENET that comments are somewhat expendable.

    2. because they tend to be topical, I am not overly concerned about preserving them.

    That said, it would be nice if Slashdot made it easier to access any post that I had ever archived. As it stands, Google can pull up a lot of them. The very nature of corporate ASPs is such that Google is not going to archive your data... at least, I hope not... hmm... but if the data were encrypted you could scam on all that Google capacity (evil grin).

  • by Animats ( 122034 )

    Close to 70% of survey respondents said their company has no plans to upgrade to any Microsoft XP products (operating system, Office) at this time. Slightly more than one quarter of IT professionals surveyed are considering Linux as an alternative operating system to Microsoft and 65% are not considering alternatives at this time.
    • Above posting garbled due to bug in Netscape Navigator text box editor. Sorry.

      The text in italics was a quote from the original article.

  • by infohord ( 311979 ) on Friday January 18, 2002 @01:00PM (#2862926)
    At our small to mid size government shop we looked long and hard at the subscription service. The flaw for us it that the subscription service is based on upgrading every two years. We do not have the resources to roll out new OS/Productivity every two years. We are now upgrading from Win95 to Win2K and that will take 2 years alone. We calculated a 4 to 5 year cycle and with that purchasing the software outright is cheaper.
  • I've been at a streaming-media search engine for about two years and I suspect we're typical of our industry.

    Basically, we're a java/Linux shop and Windows installs are regarded as a necessary evil. There are some things that we have to do that for both licensing and technical reasons (the media player HAS to be part of the operating system, right?) need to be run on windows. But every windows install is an ongoing liability. They're a pain to build and configure, unreliable, configurations differ for no apparent reason, managing large numbers of rackmounts is a nightmare, etc. etc. You've heard it all before. But the advent of XP fills us with dread. The question is not whether we'll adopt it, but whether this one will seriously damage the company.

    It kind of feels like the living in Sarajevo and being shelled by the troops up on the hill. Incoming! Licensing bombs have hit the spiders, sarge! Oh no! More breakage in the media crackers! Can we repair it or do we have to abandon the codec? I mean, it's a wintel world out there, and ours is a volume business, and if we reimplement stuff ourselves we'll be attacked by hordes of mutant ninja lawyers.

    It's not like we can ignore it. Bill farts, we run for cover. We are small, the death star is merciless.

  • by gnovos ( 447128 ) <gnovos.chipped@net> on Friday January 18, 2002 @02:25PM (#2863489) Homepage Journal
    It's the expensive subscriptions that don't. Who wants to pay full price for a new copy of MS Word every year when the one from five years ago still works. A $5-$10 a year subscription over the lifetime of a product would go over very well, but a $50-$100 one will ALWAYS fail.
  • by namespan ( 225296 ) <namespan@elite m a i l.org> on Friday January 18, 2002 @02:25PM (#2863490) Journal
    I think the big problem with software as a service is that people think they own software right now. Most home users I know don't bother to read the license -- they think it's a combination of a warantee and a "do not copy" clause. Most corporate users I know think the same thing -- and some of them think that the license exists to protect THEM (this has come up in some of the Free Software conversations I've had: "but there's no license! Who can we hold responsible?").

    They are, of course, wrong from a legal standpoint. But the interesting thing is that whatever reality is, perception affects buying just as much, and since buyers currently think they actually purchase the software, trying to get them to do something else is tricky.

    It will, of course, be interesting to see what happens as technical efforts to drive the legal reality of not owning software home increase. I'm not sure if it'll result in people raising hell and a revolution, or if they'll just lowe a little and move along like so many cattle.

The IQ of the group is the lowest IQ of a member of the group divided by the number of people in the group.