Developer forces Microsoft license rethink

Concern from a local software developer facing a hefty license fee hike has prompted Microsoft Corp. New Zealand to persuade its US bosses to modify the Windows 2000 pricing model in the South Pacific.

Microsoft NZ network solutions group manager Steve Haddock went to the licensing team in Redmond, Washington after it became clear that companies doing small-scale Web hosting for business clients faced much higher fees under Windows 2000 than under Windows NT.

Windows 2000's licensing structure requires users to buy an application service provider (ASP) license if they host third-party Web sites.

Haddock says after talks with Auckland company Designer Technology Ltd. (DTL), which hosts a dozen clients and is upgrading from NT 4 to Windows 2000, he contacted Redmond, which has since made the CPU-based license pricing model more flexible. Microsoft says the local subsidiary often goes to head office seeking changes that are more suitable to the local market.

DTL accounts and relationships manager Paul Jerrom says the company was charging clients NZ$100 (US$44) a month for Web hosting but under the new licensing model faced having to charge at least NZ$1500 a month. Following Haddock's intervention, there will no longer be an increase.

Haddock says similar companies should also not face increases. "It's impossible to give pricing on an ad hoc basis because there are so many variables with Web hosting. I believe that it solves that problem for that company. I have to sit down with all such companies and let people know there are cost-effective and flexible ways of doing it now."

Jerrom says Microsoft was prepared to listen. "We had a frank roundtable discussion where the views of all parties were discussed. We believe this decision to be a fair one, and one which demonstrates Microsoft to be a company that listens and acts where appropriate."

The news should come as relief to many local developers. One company, which didn't want to be named, hosts up to 15 clients and is planning to upgrade to Windows 2000. It believes the change could have had a "hobbling effect" on business.

Health software developer Orion Systems handles a small amount of Web hosting and says it, too, would have been caught out by the change.

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