High street bank HSBC has criticised Microsoft's moves towards subscription-based licensing, claiming that it forces too fast an upgrade cycle with few benefits for business users.

Talking exclusively to vnunet.com, Alan Jebson, worldwide group IT director at HSBC, insisted that the bank, which has over 180,000 desktops, would resist moves to subscription licensing.

"It is more cost effective in the long-term for us to repurchase the software, rather than subscribe to updates that provide little or no direct business benefit, and which we therefore consider unnecessary," he said.

"It is a matter for individual businesses to decide which approach is best in their own circumstances, but for most this change will obviously result in a significant price increase."

Jebson explained that the bank will stick with its five-year upgrade cycle based on a demonstrable business need.

"Microsoft's view of the normal replacement cycle did not correspond with our experience," he said. "It is true to say that each incremental release offers less and less value to a business."

Excel is just one example of an application that companies still use for its core functionality, according to Jebson.

"When I first started using Excel it occupied about 1MB of disk space," he explained. "Today it is between 30MB and 40MB and I use Excel in exactly the same way I have always used it. So where the other 30-odd megabytes goes I don't know."

HSBC is currently moving from Windows NT to Windows XP. "Most of our desktops today are NT," said Jebson. "Our recommendation today is that if you need to upgrade from NT then move to the latest version."

However, Gordon McKenzie, EPG manager for retail banking at Microsoft, rejected Jebson's comments and maintained that each updated version of the software adds increased collaboration functionality for business users.

"We are always adding functionality to make deployment and management easier and we are actively working with the banks to understand their business," he said.

"Our customers should buy what they need, not just because it's the latest version.

"For example, many of our multinational customers find the real-time collaboration features in Windows XP a great way for keeping colleagues in touch, particularly over separate time zones."