Microsoft's Companion Subscription License imposes a tax on non-Windows devices and may influence enterprise device decisions in favor of Windows tablets over time.
But the annual Companion Subscription License (CSL) introduced with Windows 8 may also lower the cost of supporting employee-owned devices.
CSL is an add-on option for Software Assurance (SA) customers. It allows primary users of Windows devices to virtually access their corporate desktops through a virtual desktop infrastructure (VDI) for up to four personal devices -- including iOS and Android platforms.
They have recognized users are using multiple devices. It's a shame that it only took five years to figure it out.
analyst, Forrester Research Inc.
Prior to Microsoft's CSL introduction, an enterprise would need to purchase a virtual desktop access (VDA) license for each personal secondary device.
A VDA license costs an estimated $100 per device. However, the $100 represents the estimated retail price (ERP), and, like purchasing a car from a dealer, that figure is often negotiable.
"We don't sell the CSL in an open license program, but it follows the waterfall and comes in about 25% below where the VDA pricing lies," said Colin White, a Microsoft business analyst manager for Windows.
White declined to comment on the CSL price range. An enterprise can purchase one CSL for the primary Windows user, and it will still cost less than a VDA license while covering up to four devices, White explained.
Pricing for an enterprise end-user CSL ranges from $4 to $7 per month or $48 to $84 per year for businesses that have an Enterprise Agreement (EA) and the associated SA package, sources said.
However, even with the low end of $48 per year, enterprise customers sit at different levels of licensing, and based on their volume and additional discounts, CSL fees could come in way below the low range of $48 per user annually.
These figures are frequently kept quiet because license pricing is often negotiable, depending upon the volume and arrangement customers have with Microsoft.
Microsoft CSL licensing, explained
While Microsoft has made its device licensing cheaper, it hasn't simplified things.
"The rules are very restrictive," said Paul DeGroot, a licensing expert and principal consultant at Pica Communications in Camano Island, Wash.
Microsoft's licensing has become so confusing that the industry has spawned specialized Microsoft consultants and partners who negotiate licenses for customers.
One customer who asked not to be named was not even aware of the CSL, despite the fact that the changes were announced last fall.
Microsoft had decided to change its licensing programs to accommodate the growing bring-your-own-device (BYOD) trend in the enterprise, even before the Windows 8 launch. The company previously called the new licensing arrangement Companion Device License (CDL), but changed it to Companion Subscription License to reflect the subscription model.
Since CSL is an add-on for customers with a SA license, companies with an EA running Windows 8 Enterprise Edition that also own an SA package receive enterprise features, including Direct Access, BranchCache and Windows To Go.
Furthermore, for those enterprises that have not yet deployed Windows 8, the CSL can be assigned only to a device that has active SA or VDA coverage, according to a Microsoft spokesperson. The SA coverage is attached to a device within 90 days of buying it from an OEM or at the time an upgrade license is purchased for the device, the spokesperson said.
The CSL makes sense for customers that support BYOD because it covers non-x86 devices such as Apple iOS, Android, Surface Pro or a personal Windows-based notebook.
The CSL doesn't cover the Windows Surface RT device, which is ARM-based, because it is already covered under a general SA license and is not subject to an additional CSL fee.
"It's confusing, but to be fair to Microsoft they have recognized users are using multiple devices," said Mark Bartrick, a senior analyst at Cambridge, Mass.-based Forrester Research Inc. who specializes in software negotiations. "It's a shame that it only took five years to figure it out."
Will CSL boost Windows tablet adoption?
Industry watchers think Microsoft's move to introduce the CSL is a backdoor strategy to influence enterprise IT decision makers into putting Windows-based tablets on their lists of approved devices for end users, which could influence end-user buying behavior.
"It's a strategy [that's] not going to make people happy, but it's also too late because there is so much momentum behind other platforms," said Chris Hazelton, research director for mobile and wireless at 451 Research in Boston.
Indeed, the lack of Windows 8 enterprise deployments reveals how slowly businesses have embraced the new operating system and other Windows mobile devices.
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"It's clear now, given the slow adoption of Windows 8 devices, that the surcharge on Android and iOS has done little to move the needle; it's become merely one more example of Microsoft tacking on additional client access costs," said Kris Barker, co-founder and CEO of Express Metrix LLC, an IT asset management company in Seattle.
One end user was disappointed with Microsoft's strategy surrounding licensing, even though he is a power user of Microsoft products for his business.
"[It's a] ridiculously terrible idea," said Clayton Cohn, founder of Marketaction Capital Management, a financial services firm in Chicago. "Microsoft has been going nowhere for years trying to fit the same square peg in the same round hole, while companies like Google have seen tremendous growth from spending more money to reward their employees and charging less money for people to use their products."
But Microsoft sees its CSL program differently and believes it will depend upon each enterprise's own BYOD policy.
Many companies will look at BYOD and weigh the benefits of the hardware savings versus the complexity of managing the devices, White said.
"I think you'll see a mix where some companies stick with a traditional model and ... others are pure BYOD," he said.
BYOD licensing advice
Despite Microsoft's move toward a subscription model for BYOD, licensing experts offer some advice to help end users wend their way through the vendor's convoluted licensing schemes.
Enterprise IT needs to look at Microsoft's device definitions, count the number of devices that need to be included, and understand how end users will use the device to access their data, Bartrick said.
Indeed, understanding device definitions and the costs associated with using non-Microsoft devices for VDA is extremely important. This could represent the difference between companies eventually purchasing Windows Surface RT for end users or employees bringing their own non-X86 devices for work purposes.