Microsoft Adding Processor-Based Software Pricing

BOSTON (06/12/2000) - Microsoft Corp. today said it plans to add processor-based software licensing to its existing per-seat pricing model when a new set of server applications ships later this year. Products that will be affected include the company's SQL Server 2000 database and other DNA 2000 server products.

"The top tier (database) vendors have already moved to per-processor pricing," said Terilyn Palanca, an analyst at Giga Information Group Inc. in Cambridge, Massachusetts. "Microsoft needed to make the same move that Oracle and IBM have made."

Traditionally, Microsoft has priced its server products on a per-user, requiring corporate customers to track their usage of the software and buy additional Client Access Licenses when needed. But Palanca said the market has been moving away from this model, which can be hard to manage and doesn't work well in Internet environments.

The new pricing model could give users a more predictable price and could help SQL Server gain more credibility with enterprise users, she added.

The per-processor licensing will also apply to the other server products in the DNA 2000 family, including the forthcoming Commerce Server 2000, BizTalk Server 2000 and Application Center 2000. The new pricing will take effect as each of the new products becomes available, Microsoft said.

SQL Server 2000, which is in beta testing now, will be priced at $4,999 per processor for the standard version and $19,999 for the enterprise edition, Microsoft said. The database will also still be offered on a per-seat basis, at $1,489 for the standard edition with five users and $11,099 for the enterprise version with 25 users.

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