Open Licence

Microsoft Open Licence is a volume discount agreement for organisations with between two and more than five hundred desktop PCs. It is perpetual: the licences are bought outright and paid for upfront, but it is possible to add to the number of licences after the initial purchase. Academic organisations receive additional discounts.

Open Licence customers receive a volume discount. The level of discount depends on the volume bought at the start of the agreement. This discount then applies to additional licences bought during the following two years. The minimum initial order is five licences.

Open Subscription Licence

The Open Subscription Licence (OSL) is a volume licensing agreement. It is specially designed for customers who have between five and more than five hundred desktop PCs. Qualified computers include desktop PCs, portable computers, workstations and similar products that meet the minimum requirements for running OSL platform products. Servers (even if used as a PC) and computers running only line of business software or that do not use a Windows operating system do not count as qualified computers. It is available for the following products:

Office Professional
Windows Professional Upgrade
Core Client Access Licence.

Software Assurance is built in to Open Subscription Licences so customers are guaranteed rights to the latest versions of software throughout the term of the agreement. Open Subscription Licence customers must have at least ten qualified computers and must commit to renting a licence for all qualified computers for the whole term of three years. Computers can be added to the agreement during the course of the term. There are three levels of rental payment:

5-49 computers Level A
50-249 computers Level B
250 + computers Level C

Additional computers can be added during the course of the term but should not exceed more than 100% of the enterprise size for that year. If in any case the size of enterprise does exceed more than 100% of the OSL agreement customers may cancel the existing OSL agreement and start a new agreement. There are three levels of rental payment that decrease with volume. Customers renting all three OSL platform products receive an additional 15% platform discount. Customers who already own the latest or penultimate version of a product receive an additional 50% discount in the first year. The agreement can be renewed at the end of the three years for one or three years or perpetual licences (permanent rights to use the software) can be purchased at a reduced rate. Alternatively the agreement can be ended in which case the software must be removed from the computers.

Multi-Year Open Licence

Multi-Year Open (MYO) is a volume licence agreement for organisations with five or more PCs and provides a discounted price for software. It is a perpetual licence granting the right to use a software version indefinitely and payment is spread evenly over three years. It enables organisations to ensure that the entire enterprise including all affiliates use the latest versions of software.

MYO customers receive a discount based on the volume of licences bought at the start of the agreement. The greater the quantity, the greater the discount. Customers state in their MYO agreement form how many PCs they wish to enrol. They then choose to cover these with one or more Microsoft Platform products and additional products such as Project or Visual Studio. There are three price levels for MYO Platform products. The price paid by a customer depends on the number of PCs stated in the signed agreement and the Platform products that the customer chooses. The price level remains the same during the term of the agreement.

10-49 computers Level A
50-249 computers Level B
250 + computers Level C

At each anniversary the customer is required to report any increase in PCs. Additional PCs are included in the invoice for the year purchased and billed on future annual invoices for the remaining term. It is not possible to reduce the number of PCs stated in the initial agreement. It is possible to add more products at any time and pay for the year that the additional software was added. Additional products are then billed on future annual invoices for the remaining term.

The organisation must be a single legal entity but affiliates can be included in the agreement. Affiliates must be single legal entities also, either owned and controlled by the customer, owning and controlling the customer or under the same ownership and control as the customer. Four options are available for affiliates:

Include all affiliates and any acquired after signing the agreement
Include all affiliates acquired up to the signing of the agreement
Include selected affiliates
Do not include affiliates.

The price level is based on the number of qualifying computers in the organisation and on affiliates included in the agreement. Additional products can be purchased at any time during the course of the agreement. Once an agreement has been accepted and processed, Microsoft send an acceptance letter or e-mail containing an agreement number and confirming the number of PCs and additional products ordered. The agreement number must be quoted in all additional product and annual PC reporting. A Welcome Kit is sent containing media for the Platform products listed in the signed agreement. Additional product media is available through the usual fulfilment process. Standard fulfilment prices apply. Licence confirmations are provided by Microsoft direct to the customer at the end of the three year term when all three payments have been made.

Every licence ordered under MYO is covered by Software Assurance allowing the use of the latest versions of software product covered by the MYO agreement and released within the term of the agreement. These versions can be used indefinitely when the agreement ends. CThe MYO can be renewed for one or three years.

Organisations with five or more PCs can start an MYO agreement with two options: Volume or Enterprise. The Volume option obliges customers to choose one or more Microsoft Platform products for at least five PCs. The Enterprise option obliges customers to enrol the entire organisation in one or more Microsoft Platform products. The Platform products are:

Windows Professional Upgrade
Microsoft Office Professional
Core Client Access Licence.

Select Licence

Microsoft Select Licence 6.0 is suitable for customers with two hundred and fifty or more desktop PCs who can forecast software requirements over three years. It is a perpetual licence that is bought outright but is flexible; initial forecasts are not binding. Select Licence customers forecast likely software requirements over three years. The discount level depends on the size of the forecast and may be adjusted up or down in years two and three depending on the volume actually ordered during the previous year. Volume is measured using a points system, with higher value licences earning more points.

There are four levels of Select Licence discount: A, B, C and D. A points system is used to assess the discount level. Software product licences are divided into three categories or pools:

Applications: desktop applications such as Microsoft Office Systems: Windows Professional upgrade
Servers: all software for servers and associated Client Access Licences.
Each licence ordered from a given pool earns points for that pool. It is necessary to forecast the number of points to be earned for each pool over the three years of the agreement to set the discount for that pool for the first year of the agreement.

1,500 points Level A discount
12,000 points Level B discount
30,000 points Level C discount
75,000 points Level D discount

At the end of each year of the agreement there are price level reviews of the points earned. Higher points attract higher discounts and vice versa. There is also a review at the end of the second year when the customer must have earned points equal to two-thirds of the original agreement. If they exceed or fall short of the levels forecast they will also be re-levelled accordingly. Similarly, the customer must reach the levels forecasted for the review at the end of the third year. Examples of point values:

Office XP Professional 2 points
Excel 1 point
Windows XP Professional Upgrade 2 points
Windows XP Standard Server 15 points
Windows XP Server Client Access Licence 1 point

There is also a minimum forecast size, based on the points system. It is necessary to forecast earning at least 1,500 points from licences in one of the following three categories: PC applications, PC operating systems and server software. Select Licence customers can add Software Assurance when buying individual licences guaranteeing the right to new versions of the software that are released during the three year Select Licence agreement period. Software Assurance can be bought with the main licence or as a renewal. Customers without Software Assurance who wish to upgrade will need to buy a completely new licence.

Enterprise Agreement

Enterprise Agreement is designed for customers with two hundred and fifty or more qualified computers. Qualified computers include desktop PCs and Apple Macintosh computers, portable computers, workstations and similar products that meet the minimum requirements for running Enterprise products. Servers and computers running only line of business software or an embedded operating system do not qualify. There are three Enterprise products:

• Windows Desktop Operating System Upgrade:
  to Windows 2000 Professional or to Windows XP Professional.
  
  
• Office Professional:
  the current version includes Word, Excel, PowerPoint, Outlook Messaging and Collaboration Client and Access.
  
  
• Core Client Access Licence:
  Exchange Server, Windows Server, Systems Management Server and Sharepoint Portal Server.
  
  Software Assurance Membership is built in guaranteeing permanent rights to new versions of software released during the three year Enterprise Agreement period and a range of other benefits. The level of discount depends on the number of qualified computers at the start of the agreement. The discount then applies to additional Enterprise licences bought during the following three years. Discounts are also available on other Microsoft products. Customers who buy all three Enterprise products receive an additional 15% platform discount. Payment for Enterprise products and any other products bought by the customer at the start of the agreement is made in annual instalments over the three year period.

Enterprise Products

An Enterprise Agreement requires all qualifying computers to be licensed with one or more of the three Enterprise Products: Windows OS upgrade, Office Professional or Core Client Access License (CAL). The number of computers licensed at this stage determines the discount level for Enterprise product licences bought during the three years of the agreement.

250 computers Level A discount
2,400 computers Level B discount
6,000 computers Level C discount
15,000 computers Level D discount

It is possible to add products after the initial agreement without starting a new agreement. Non-Enterprise licences for non-Enterprise products can be purchased for some or all qualifying computers. The discounts for non-Enterprise licences are at one of the four Select Licence levels. The level depends on the relevant pool and on the Enterprise products purchased. The discount for non-Enterprise products from the same pool as an Enterprise product is at the equivalent Select level. Other non-Enterprise products attract a Select Level A discount.

It is possible to renew the agreement for one or three years at the end of the three years. Computers acquired during the renewal term can be licensed at a discount. The discount level for the renewal term is based on the number of computers licensed at the time of the renewal. If no additional licences are bought customers pay for the Software Assurance that continues for the renewal term.

Enterprise Subscription Agreement

The Enterprise Subscription Agreement is a volume licensing agreement for customers who have two hundred and fifty or more qualified computers, who want to standardise by installing one or more Microsoft Enterprise products on all computers for at least three years and who want to rent rather than buy licences.

Qualified computers include desktop PCs (and Apple Macintosh computers), portable computers, workstations and similar products that meet the minimum requirements for running Enterprise products. Servers and computers running only line of business software or an embedded operating system do not count as qualified computers. There are three Enterprise products:

• 
  Windows Desktop Operating System Upgrade:
  to Windows 2000 Professional or to Windows XP Professional
  
  
• Microsoft Office Professional:
  the current version includes Microsoft Word, Microsoft Excel, Microsoft PowerPoint, Outlook Messaging and Collaboration Client and Microsoft Access
  
  
• Microsoft Core Client Access Licence:
  Exchange, Windows, Systems Management and Sharepoint.

Software Assurance is built in to Enterprise Subscription Agreements guaranteeing rights to the latest versions of software throughout the term of the agreement. Enterprise Subscription Licence customers must commit to renting a licence for all qualifying computers for the whole agreement term of three years although the number of licences rented can vary if the number of computers varies during the term of the agreement. Enterprise Subscription customers pay significantly less each year than Enterprise Agreement customers. The price level depends on the number of qualified computers that are licenced for the year. Customers who rent all three Enterprise products receive an additional 15% platform discount.

All qualifying computers must be licensed with one or more of the three Enterprise Products: Windows OS upgrade, Office Professional or Core Client Access License (CAL). The number of computers licensed at this stage determines the level of rental payment made for Enterprise products for the first year of the term.

250 computers Level A payments
2,400 computers Level B payments
6,000 computers Level C payments
15,000 computers Level D payments

At the end of each year it is necessary to submit a report of the number of qualifying computers. Payment levels for the following year are based on the revised number. A selection of non-Enterprise products can be included in the agreement. Non-Enterprise licences can be rented for some or all qualifying computers. The price level for non-Enterprise licences depends on the relevant pool and on the Enterprise products rented. The price for non-Enterprise products from the same pool as an Enterprise product is at the same level as the Enterprise product. Other non-Enterprise products are at level A. At the end of the three years it is possible to renew the agreement for one or three years or to buy perpetual licences at a reduced rate. If neither option is chosen it is necessary to remove the software from the computers.

Full Packaged Product

OEM licences

OEM licences are for pre-installed software and are issued by hardware manufacturers to end users. The licence is for use only on the computer system on which the software was pre-installed.

Software Assurance

Software Assurance is an efficient cost effective method to get current and stay current across an organisation. When added to a licence it guarantees rights to new versions of the software released during the agreement period. Software Assurance replaces earlier upgrade products (version upgrades, competitive upgrades and product upgrades). It is available as an option to Open Licence or Select Licence customers and lasts throughout the Open Licence or Select Licence agreement term. It is included in Open Subscription Licence agreements, Enterprise Agreements, Enterprise Subscription Agreements and Campus/School Agreements. Open and Select customers can only buy Software Assurance when buying a full product licence (although once bought it can also be renewed). The only way to upgrade is to buy a completely new licence.

Educational Licenses

Licence Comparison Table

Type of licence	Campus Agreement	Open Licence	Select Licence
Designed For	Higher and further education institutions	Small to medium-sized education institutions with two or more desktops	Education institutions that intend to buy 250 or more licences over three years
Products included	Customers can choose to run the latest versions of the following products that are priced separately: Office Standard and Professional Windows Upgrade Core CAL FrontPage Project Microsoft Press Titles SQL Server CALs Visio Professional Visual Studio Publisher. Servers are also included	An extensive range	An extensive range
Upgrades	Included during the agreement term	Stay current by paying an extra fee for Software Assurance (see above)	Stay current by paying an extra fee for Software Assurance (see above)
Support	Several options including Microsoft Certified Solution Providers and purchasing support	Download Service providing access to software updates, programming aids and device drivers Online product support Telephone support.	Download Service providing access to software updates, programming aids and device drivers Online product support Telephone support.
Delivery	One annual payment based on staff count and product selection and optional inclusion of students. Sign an agreement for confirmation of the licences acquired each month	Standard: at least five licences. Single licences can be added during the term Volume: at least 150 licences for applications, servers or systems.	Volume pricing across the whole organisation. Sign an agreement for confirmation of the licences acquired each month
Term	One year (renewable)	Two years	Three years

Type of Licence	School Agreement	Student and Teacher Licence	Full Packaged Product
Designed For	Primary and secondary schools	Students and Teachers in full or part time education	Education institutions buying software in very small quantities
Products included	Customers can choose to run the latest versions of the following products that are priced separately: Office Standard and Professional Windows Upgrade Core CAL Frontpage Visual Studio Project Class Server CAL Microsoft Press Titles SQL Server CAL Visio Professional Encarta Reference Library Magic School Bus Publisher. Servers are also included	Microsoft Office XP Standard for Students and Teachers including: Word 2002 Excel 2002 Powerpoint 2002 Outlook 2002 Office Content CD Office Step by Step Guide.	An extensive range
Upgrades	Included during the agreement term	Not included	Not included
Support	Several options including Microsoft Certified Solution Providers and purchasing support	Installation Support Services Only	90 days free telephone support
Delivery	One annual payment based on PC count and product selection and optional inclusion of students	Open the box and install the software and telephone or use the web to obtain the Product Activation Key. Finish the installation and use the product immediately	Proof of eligiblity is required before buying. Return the registration card to Microsoft after purchasing the package
Term	One year (renewable)	Not applicable	Not applicable

Server Licensing

User Client Access License (User CAL)

The User Client Access License (User CAL) provides a manageable and to access server software from any device. The User CAL eliminates the need to obtain a Device CAL for every device from which the server software is accessed. Device CALs will still be available as a licensing option and it will be possible to acquire Device and/or User CALs for new versions of Microsoft server products that are licensed on a Server/CAL basis.

A company that requires access to Microsoft Windows Server from multiple devices such as a work PC, a home PC and a wireless PDA can purchase 1 User CAL for each person rather than purchasing multiple Device CALs. A company whose employees share devices such as in a call centre may still opt to purchase 1 Device CAL for each device accessing the server software.

External Connector for External Users

The External Connector license provides a manageable and cost-effective way to enable business partners and end-customers to access licensed server software, eliminating the need to count and purchase individual CALs. It will be available for new versions of Microsoft server products that are licensed exclusively on a Server/CAL basis (products without a processor-based licensing alternative). External Connector licenses cannot be used for hosting.

Server Product Usage Rights

Products that are licensed on a Server/CAL basis require a server license for every copy of the server software and a CAL for every device accessing or using that server software (Device CALs were called Per Seat CALs previously). A User CAL option will be added to the Server/CAL model providing the option of purchasing a single CAL for an individual user accessing the server software from any number of devices rather than a CAL for each of the devices. Every installed copy of the server software still requires a server license. The price for a User CAL is the same as the price for a Device CAL.

Product Integration Program

The Microsoft Product Integration Program allows Independent Software Vendors (ISVs)—companies that develop software solutions—to embed Microsoft SQL Server, and/or any other Microsoft product available through existing distribution channels, with their own applications to create and sell complete, integrated solutions.

With the Product Integration Program you can:

Embed the Microsoft product code into your application code.
Include the Microsoft product along with your application on the installation media.
Pre-install the Microsoft product on a hardware system that is part of your value-added business solution.
Provide a Microsoft Full Packaged Product with a shipment of your value-added business solution.