The Step-Up License Program that was due to expire on August 31 has been turned into a permanent offering and made available across 20 Windows server and desktop products for enterprise customers buying under volume licenses.
Microsoft introduced Step-Up in June 2003 to provide volume customers a low-price way to upgrade from Standard Editions of certain products to Enterprise Edition, without purchasing completely new software licenses.
Originally, the program applied to just eight server products.
Microsoft launched Step-Up in the wake of a backlash among customers to changes in the way the company licenses products to volume buyers, Licensing 6.0. A particular bone of contention was Software Assurance (SA).
SA, available under two- or three-year cycles, entitled customers to upgrade to versions of products they may be running when new products shipped. The problem with SA, though, was there was no guarantee Microsoft would actually ship a new version of a product during the two- or three-year cycle of a contract.
Introduced by Microsoft 10 months late to allow customers to adjust, SA and Licensing 6.0 were greeted with hostility according to analysts’ surveys with customers warning they would be unable to afford SA and expecting higher software costs.
Microsoft has always maintained SA provided customers value. However in May this year Jupiter Research found 53% of large companies and two fifths of Small and Medium Businesses (SMBs) are paying more for Microsoft software under the plan.
Such is the rate of discontent; Microsoft expects just 10% to 30% of customers under the older, expired, Upgrade Advantage (UA) license to renew their contracts to SA.
Step-Up was introduced along with other measures intended to add value to SA. These sweeteners included home use rights to Office 2003, internet and telephone support, and subscriptions to online training resource TechNet.
Directions on Microsoft analyst Paul DeGroot called Step-Up a restoration of the Product Upgrades that were eliminated under Licensing 6.0 and SA. DeGroot said Step-Up is an important tool in rewarding customers for their loyalty, as without it customers moving from a Standard Edition to Enterprise Edition product were forced to purchase a completely new license.
DeGroot said: Step-Up is a pretty necessary element of SA, otherwise there was a very big barrier in front of people who use Microsoft’s software, and want to use more.
In a statement, Microsoft called the process of making [Step-Up] a permanent offering and extending the list of products for which Step-Up licenses are available, another step in adding more value, more assistance and more manageability with products and programs through SA. We plan to continue to add value to Software Assurance over time, the statement said.
