Microsoft could be forced to change its software pricing model - but only for some customers

Date:
Mon, 12 Sep 2022 12:54:22 +0000

Description:
Microsoft may be forced to stop charging for software on a per employee basis in some circumstances.

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A Democrat senator is preparing to submit new draft legislation that could have significant ramifications for Microsoft and other large software
vendors.

As reported by Bloomberg , which gained access to the documentation, the proposal would establish new terms under which software makers are allowed to sell to buyers in the federal government.

Specifically, the legislation would mandate a level of interoperability between rival services and require vendors to move away from a per employee pricing structure, towards unlimited licences. Software pricing structures

A spokesperson for Senator Gary Peters, who authored the bill, says the final draft is still to be finalized and may be subject to change. However, the broad objective will remain the same: to protect the federal government from unnecessary overspend on productivity , collaboration , ERP and other kinds
of software.

Excluding the budget for the Department of Defense, the US Government has set aside roughly $60 million for IT spend this year, data from Statista
suggests. However, research conducted back in 2014 suggests a fair chunk is likely to be wasted on excess licenses and penalties for breaching terms of use.

In an effort to rectify this issue, Congress has already introduced new rules surrounding the monitoring of software usage and purchases among federal agencies. But the new draft bill would take protections a step further, targeting the licensing models of which the government often falls foul. Read more

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By demanding vendors shift from a per-seat model to unlimited licenses, the bill would shield agencies against the kinds of fines they incur when usage limits are breached, as well as removing blockages created by a lack of interoperability between rival services.

Although the bill will still need to pass through Congress once the draft is complete, Bloomberg speculates that the sponsorship of Senator Peters, who heads up the Senate Homeland Security and Government Affairs Committee, will increase the odds of its success.

TechRadar Pro has asked Microsoft, SAP, Oracle and Zoom all of which are said to supply software to the federal government - for comment on the Peters proposal. Also check out our list of the best office software on the market



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Link to news story: https://www.techradar.com/news/microsoft-could-be-forced-to-change-its-softwar e-pricing-model-but-only-for-some-customers/


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