Microsoft has been pushing new licensing plans on several
businesses, organizations, and even cities. In January, Microsoft
told Houston, TX that it must buy a $12 million multi-year
software licensing plan for Office, or it would be audited and
fined for each piece of software which it could not produce a
license for. A Microsoft sales representative claimed that the
city owed $1.1 million for unlicensed software being used by city
workers. Microsoft even went so far as to claim that the Houston
Public Library was short 450 Office licenses. However, Houston was
able to produce proof that they had licenses for every piece of
software in the library. This would include 111 copies of Office
donated by Bill Gates’ charity foundation.
The multi-year plan offered to most
organizations by Microsoft is to sign up for something called
"Software Assurance". This would allow the particular organization
to buy Office XP (the newest version) at a price of $239 to $380
per copy instead of the normal price of $479. This plan would save
money for a company providing they upgrade every three years. Many
organizations don’t upgrade that often, and would be forced to pay
the normal price.
Houston did not see Microsoft’s "offer" as a fair and viable
solution. Instead of continuing to use Microsoft Office, they
struck a deal with a little-known competitor called SimDesk.
SimDesk is an Internet-based application similar to Office, but
not quite as complex or powerful, and is offered at a fraction of
Microsoft’s price. Houston signed a $9.5 million, five-year deal
with the competitor.
There are two major parts to this contract. First, Houston will
put SimDesk on at least half of the 13,000 PC’s used by its
workers. Second, SimDesk will be available to all residents with a
library card, up to three million possible users. Compared with
Office, this is a significantly reduced price tag and Houston is
confident that it will be a viable alternative.
Houston isn’t the only one contemplating a deal with Simdesk.
Chicago recently agreed to a pilot program with the software.
SimDesk reports that they have also begun talks with Los Angeles
and the government of Brazil.
In addition to Houston, other cities and organizations have
been offered similar deals by Microsoft. Several have complied,
but at first so many of them were reluctant that Microsoft pushed
back the deadline to sign the deal three times, to August 2002.
Microsoft even sent letters to 500 school districts allowing them
60 days to produce licensing for every piece of Microsoft software
that they are using. If they do not comply, they could be audited
Will SimDesk be a viable contender to Microsoft, or will they
be crushed like many companies before them? I guess we’ll just
have to wait and see.