MS reimaging sting will cost business $11bn – Gartner
Fat cat revolt leaves SMEs footing the bill
The Gartner Group issued a scalding advisory this morning claiming that Microsoft's amended policy on reimaging Windows CDs will net Redmond an extra $11billion in revenue.
Gartner says that despite further amendments relieving its biggest enterprise customers of the burden since it first raised the issue in August, the new imaging policy hits smaller and medium sized Microsoft customers hard.
"Gartner clients are incredulous that Microsoft is now charging a fee for a practice that is considered a basic necessity for deploying and supporting Windows desktops in any organization," observes analyst Neil MacDonald in the advisory.
As we noted last month, it's a subtle shift that involves a tangle of new obligations spread across a range of licenses. But what it boils down to very simple. Microsoft is introducing a fee for cloning internal Windows CDs by blocking off customers' legitimate alternatives. Remember these folks have already paid for their right to use Windows - it's what they do with it next that Microsoft doesn't like, so its effectively an extension of the Windows license into new territory: how you use it. And therein lies a treasure trove of new revenue opportunities.
The first legal barrier is that customers can no longer overwrite the OEM's Windows image with one of their own. That used to be a free option, one widely used to customise a corporate desktop and invaluable to support engineers. But now businesses have to buy the right in the form of one of four "imaging" licenses that range between $117 and $151 per desktop. Ignoring this will now also nullify the OEM support contract.
Gartner notes that Select or Enterprise customers are exempt from reimaging licenses, a concession that Gartner reckons has saved these customers up to $2.3 billion. But the draconian new restrictions still apply to Open (aka MOLP) customers.
"Microsoft's position is counterproductive in that reimaging enables new versions of Windows to be adopted more quickly," notes MacDonald.
The move has already proved unpopular enough to cause a revolt amongst the larger customers, but will it be unpopular enough to oblige Microsoft to change the unfortunate heading on this page, we wonder?
And we can only hazard a guess at how Microsoft's corporate sales team in China - where Linux distros are freely distributable and modifiable within the terms of very flexible licenses - will sell this one. ®
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