Microsoft ponders licensing change

Microsoft is remaining tight lipped about rumours that it may soon be introducing a 'non-perpetual' software licensing strategy - a move which would see the end of the 'one fee, one user' model for selling applications and operating systems.

A conference call between analysts last week suggested that the Redmond giant is considering selling its software on a subscription service, something which the company has been considering for a while.

Should this rumour turn out to be true, it would see the end of the 'perpetual use' licensing model which lets customers continue using whatever version of their software they possess at the time their contract expires.

Instead, customers would be expected to continue paying for software in an ongoing contract, a move which would give Microsoft another revenue stream because getting customers to upgrade to the newest version of software has always been a problem for the company.

According to analysts, those companies that buy software and use it for many years will be the hardest hit. It is thought that Microsoft is adopting the 'non-perpetual' strategy amid slowing sales of PCs.

As the market reaches saturation point the company makes less revenue on new PC sales. This way Microsoft would collect revenue simply through the continued use of its software.

But Microsoft is remaining tight lipped about its plans. A spokeswoman said the company is "always looking at ways of simplifying licensing agreements" but couldn't confirm whether the 'non-perpetual' system would be the way forward.

She added that "there will be some announcements along those lines soon. Watch this space."