IT pros troubled by Microsoft's user CAL price increase

Microsoft will increase the user CAL by 15%, leaving many IT pros upset, but with little choice to pay up.

Microsoft will raise the price for its user client access license on Dec. 1 by as much as 15%, resulting in significantly higher prices for customers who have little choice but to pay up.

The user client access license (CAL) is intended for organizations whose employees access Microsoft servers or products from a range of devices, whether it's a laptop, smartphone or tablet. The price increase won't affect the device CAL, which is intended for single devices accessing a server, regardless of the number of users who use that device.

Windows user CAL customers are frustrated by the sudden price hike.

It's either really shrewd or shortsighted.
Darren Schoendirector of technology infrastructure, Broward Center for the Performing Arts

"I think it's a raw deal. We're already spending thousands of dollars for server licenses. They're sticking it to everybody," said Scott Frazier, IT administrator at Con. J. Franke Electric, an electrical contractor based in Stockton, Calif. "I think it's just nuts that we pay for the server and then they charge us to use it."

A spokesperson for Microsoft said the company increased the user CAL price because it now "supports unlimited devices and simplifies licensing management and compliance as devices in the workplace proliferate. Pricing for user CALs will change to reflect the increased value."

Frazier said he hasn't figured out how much the increase will impact his company yet, but it may cost an extra $2,500 the next time he renews his Software Assurance agreement with Microsoft. The increases will primarily impact SQL Server and Exchange users.

Customers with existing volume license agreements or software assurance agreements will be able to keep their current pricing until the end of their contract, and will only be affected once they renew their licenses. However, any customers whose contracts expire in the near-term should contact their Microsoft partners to best protect themselves from these price increases, industry watchers said.

Microsoft's way or the highway

Meanwhile, companies are left without much of a choice except to pay the increased price.

"Whenever I get to pay Microsoft more money, I'm not exactly happy about it, but it's not like we're going to switch to somebody else's server products," said Philip L. Moya Jr., IT manager at the San Antonio Kidney Disease Center. "We're in a tight spot [because] 15% is a steep number, but like I said, we're stuck."

Products affected by Microsoft user CAL price increase

  • Exchange Server Enterprise CALs
  • Lync Enterprise CALs
  • SharePoint Server Enterprise CALs
  • System Center Configuration Manager
  • Windows Server CAL

The problem is there aren't viable alternatives for organizations that have invested significant amounts of money in a Microsoft infrastructure, one analyst said.

"You can't just flip everything into Office 365 or Google Apps. Migrating away from those investments is a years-long project," said Darren Schoen, director of technology infrastructure at the Broward Center for the Performing Arts in Fort Lauderdale, Fla.

Companies have so much process, policy and workflow already established with Microsoft, Schoen said. Plus, there's the additional dollars for training because your employees have been using Office for 10 years, and since everything will be cloud-based, your IT department has to make sure the connectivity and bandwidth are optimized, he added.

"It's either really shrewd or shortsighted," Schoen said. "Microsoft needs to make their money, but the price hikes could cause IT departments to look at other alternatives."

Office 365 a viable option

One of those alternatives might even be a Microsoft product. This price increase continues Microsoft's push to get customers to migrate into the Office 365 environment, said Wes Miller, research vice president at Directions on Microsoft, an independent analyst firm based in Kirkland, Wash., which published a report on the CAL changes.

Miller cited the new pricing for Office 365 Small Business Premium, which was announced in September, as well as the possibility that Office apps on iOS and Android mobile devices will require an Office 365 subscription for editing features as two other recent examples in Redmond's strategy.

"Office 365 doesn't require a CAL," Miller said. "That's going to make it more appealing. I think Microsoft feels like Office 365 is the future for the Services and Tools Division. It's the best approach because you get recurring revenue every month."

Microsoft is in a tricky spot, Miller said, because it needs to subtly convince companies to migrate towards Office 365 without alienating them to the point where they will consider alternate vendors.

"Once that ship sails for an IT department migrating away from anything Microsoft because of price hikes, there's no going back," Schoen said. "It's bleeding out the existing install base instead of trying to expand it."

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How will you respond to the Microsoft user CAL price increase?
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Linux/BSD
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there are other alternatives, where you do not lock yourself to Microsoft
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Opensource
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As mentioned in the article a migration to another vendor is a long term project for a facility our size and needs to be planned. This type of price increase will affect decisions in the future and those decisions will not be favorable towards Microsoft products.
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Open source is getting to be appealing
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No real choice at the moment at least for the next 12 months
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I think Microsoft are looking to grow sneaked into the computer area that is currently economically stagnant.. No everybody can pay this 15% and there are new alternatives a low cost. Microsoft is punishing loyal customers, making them look for other cheaper alternatives on the market or worse forcing clients to illegal practices like licensing growth pirate.
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May be using Office 365.
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google and linux become more appealing everyday.
Open office is a very viable alternative.
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The surest sign of a marketshare monopoly is the ability to raise prices during the early stages of a weak economic recovery while everyone else is offering discounts & value bundles. The other sign is a history of product churn via continuous unneeded feature bloat & convenient product lifecycle expirations that force new product adoption. The Gates Foundation motto aside, what Bill Gates has left us is a giant monopolistic money machine that has become a gorilla in the planetary computer room. Fortunately, Android, open source, Linux and SaaS are maturing to the point of offering some intriguing options for certain applications. The M$ Squeeze won't have such an irresistible grip in the near future, and some IT shops will begin to explore ways out of the M$ Mousetrap.
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Blood from a turnip!
MS is going to force everyone to look else where.......They will be there own undoing!!
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we will look at cloud based and open source alternatives
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Will look at other options but we are heavily invested in Microsoft so it will have to make sense dollar wise.
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Linux
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Bueno lo mejor va hacer cambiarme de plataforma
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depends on available alternatives
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Choice
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We're just seeing this issue now, so it will take a while for us to research the issue and come up with a strategy.
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At this point I don't know what we will do, but we are kind of locked into Microsoft right now.
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Google Cloud Mail
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Move, The costs are to much. This is Blackmail to move and be entrenched in Office365
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Microsoft is no different than the banks or any other company which we have allowed -no eagerly flocked to- to create a virtual monopoly with our data (and money) so you have to expect them to crank up the charges when they want more -no their shareholders want more too! Hey, wait that's in my mutual fund! Hmmm.. must think more...

At the end of the day, we all make choices. Choices have consequences. Marketing companies count on us to jump on bandwagons that give us short term gains that turn out to be long term pains -and history shows we have short memories and aren't fast learners. So if we (the consumers -not expected corporate revenue streams) don't like the increases, expect nothing to change unless we support more open and competitive choices, by making decisions that put us back in control of our data and our businesses.
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Other options, such as a Linux OS, Google Docs are becoming more likely. In Fact, Open Office has come a long way and that's definitely a likely option.
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I'm fed up to the back teeth with MS's attitude to price gouging increases.
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sucks!
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Not so much one can do, but pay the increase...
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Novell or Linux options
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Lotus Smart Cloud
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Everybody raises prices every year. just used to it I guess
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365 is not an option because it requires a constant internet connection or MS office to continue to work off-line. Plus at some point the monthly charge exceeds the one-time cost. Other options are free.
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Looking at IBM
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we're already using Linux and OpenOffice
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I'm happy we spent the time and effort to look into alternative products. We spend far too much time and energy trying to manage licensing, and the cost increases over the past 5 years is unacceptable. We're done.
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Not sure where I will look but I will. This is total crap.
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There are alternatives to the microsoft products and some of them are quite good, the question is whether it is more costly to impement the alternatives or pay the increased cost to microsoft. Office 365 sucks if you're accustomed to running your own mail server and the massive changes in the user interface of Windows 8/Server 2012 make it feel like you're learning a new OS anyway. This, along with the added costs associated with the Windows platform make this a prime time to look at other OSs/Database/Email systems.
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We are currently stuck and Microsoft knows it. MS knows they will lose some people over this, but like any increase, the hit will soon be forgotten.
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.
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we don't want to pay at the same time we don't have a choice.
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Computer prices have come down drastically since the 90's, but higher costs associated with people programs have risen. Microsoft prides itself on ensuring their programs/devices out perform others. I like that in a company. You pay for what you get.
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I'm glad our company never banked everything on Microsoft. IBM software is looking good now.
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will pay the price increase but will look into other avenues in the next roadmap.
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Pay now and plan to move elsewhere...prepare Sr Management and the end users for the eventual change...
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Cloud/Linux
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We just renewed software assurance with MS so we are good for two years at which time we will research what our options are, MS or and alternative. A lot can happen in two years time.
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I didn't know of this price increase. I'm doing research on moving toward either Office 365 or Google Apps. From what I read here, I think Google Apps is the better option. For Office 365 pricing, MS wants us to pay $200 / user / year. Currently, we pay $300 for Office 2010 on new desktops, and those machines last us 5 years. Under the Office 365 pricing, we would pay $1000 over the course of 5 years...not a good deal. As for desktops, we are planning to move toward Ubuntu / LibreOffice. Email and database servers...FreeBSD all the way. Dovecot/Exim for email & PostgreSQL / MySQL for database. If some of you are Unix-averse, I recommend Webmin, a GUI for system administration that sits on top of Unix. Tablets...we employ Androids mostly, with some iPads sprinkled in.
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There are plenty of other OS in the market, Microsoft is just the biggest, not necessarily the best.
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start looking at UNIX/lenix options
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Somebody's gotta pay for the oncoming failure of Windows (makin' everything work like a Zune) 8. Suck it up and pay is the order of the day.
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Was looking at 2012. Now will probably hang on to 2008 where we already have CAL's
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Plenty of alternatives to M$ these days. Personally I like what IBM are doing with Connections, Docs and SmartCloud. My company is seriously considering these now.
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move on to linux
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To those of you that are looking at migrating to Office 365 you will have to do that migration within 12 months or have Microsoft automatically update it for you as we have just learned. My search has started for our replacement of Microsoft just as it has for Blackberry. Microsoft you are just another stepping stone in the history of computing!
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We embarked on a programme to switch all apps (that r still running on MS) to other variants that are UNIX/Linux based. Since we succeeded with our core banking app, shifting the rest will not be hard.
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robbery
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Get rid of Exchange; go to hosted
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May bring services in house.
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Nedd more research.
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There are good reasons why private monopolies are considered to be bad things.
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There are definitely alternatives for some things out there. For example, Lotus Symphony or Open Office can fully replace Microsoft Office. Users resist to start with, I did too, but that's because all users tend to resist change. Once you learn these other products they are equally as functional and as easy to use. Linux on any platform is a strong answer to Microsoft Windows. Yes it will take time to migrate but take it one step at a time and start changing and reducing your Microsoft costs. This is a normal pattern for Microsoft -- and they will be doing it again in the future. They will force you to where they want you (because it lowers their support costs) and optimizes their revenue stream and then they will gouge you in whatever new model they have driven to you. Bite the bullet and start moving away from them now.
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Depending on software there may be other options such as Office 365.
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If not immidiate. will try to find an alternate in very near future which can offer for better price.
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I will migrate toward IBM SmartCloud.
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