Microsoft has been toying with ideas on how to increase revenue streams from its software offerings, both operating system and business productivity software. It’s suggested that Microsoft’s objective is a strategic response to pirating: if pirates act because software costs are too high, then find a way to lower those costs without giving it away. But Microsoft’s newly announced rental program seems more a modification of licensing to meet real world usage of Microsoft’s software, in a way that can generate a few more dollars.
From the description offered on the Microsoft Partner Network, it seems that rental only applies to owners of such software (i.e., you aren’t renting from Microsoft, but are renting from the legal software licensee.) According to the site: “Windows desktop operating system and Microsoft Office system licenses do not permit renting, leasing, or outsourcing the software to a third party...Rental Rights are a simple way for organizations to get a waiver of these licensing restrictions through a one-time license transaction valid for the term of the underlying software license or life of the PC.” Under Microsoft’s old licensing system this was technically ‘illegal' (but people were still doing it). Now, with the right payment, it is ‘legal.’
For example, the steps in rental, according to the Partner Network, consists of (1) obtain from Microsoft valid licenses for all machines to be rented; (2) acquiring rental rights for those PCs from Microsoft; and (3) finding customers to rent them. Same process holds true for renting Office, except, naturally, a license for Office must also be held. Rental rights are “perpetual”, but are permanently assigned to a PC and cannot be transferred.
What benefit there is to this isn’t all that clear. Microsoft analyst Paul DeGroot says it is a big deal, that it “could give a boost to Internet cafes, companies renting rather than buying computers.” Further, because renting only applies to current versions, it could “reduce the drag from ‘good enough,’ particularly for Office.” But put an end to piracy? DeGroot isn’t as certain--the price differential between legitimate and pirated, whether rented or not, is still to great to think there’ll be an impact.
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