Software licensing: Enter the rabbit hole

September 25 2009

If there’s one area of IT management that gets techs and business owners alike scratching their heads, it’s software licensing.

Buying software for your home computer is usually as simple as going to the office store and grabbing a box from the rack. At the business level, however, things get more complicated.

There, you have another range of options, including various kinds of volume purchases, subscription or leasing deals, and upgrade/downgrade “assurance” plans. Take a look at the Microsoft web site if you’re ready for a headache!

When evaluating licensing options, purchase price is of course important. But if you’re talking five or more machines, other considerations come into play as well. Among them:

Multi-year costs

Beyond initial sticker price, how do the purchase costs play out over the next three, six, or 12 years? Some options cost more up front, but you’ll recoup the difference and more over several years.

License administration

How easy is it to track the license and manage updates at a company-wide level? Will you have to remember each week to buy an update for this or that machine, or can it be done all at once? Have you accidentally (and illegally) installed a single copy of software on more than one machine? More tracking hassles translate to higher administrative costs.

Version/platform standardization

Network administration is easiest (and cheapest!) when all your machines are running the same software version. Will the license allow you to upgrade or downgrade individual machines to match the company standard?

Keeping these questions in mind will help you navigate the maze of available licensing options. See our related Business Brief for more details.

One further caveat: While bargain shopping pays big in some areas, software isn’t one of them. If a price looks too good to be true, it probably is! Counterfeit software will do you even less good than a fake Gucci or Rolex.