Public sector to escape Microsoft's 25% licensing price rises

Public sector to escape Microsoft's 25% licensing price rises

Planned increases in prices of Enterprise Agreements and Select Plus deals to be offset by lower costs under PSA12 framework

The government will not feel the effect of Microsoft price rises on volume licensing when the three-year Public Sector Agreement (PSA)12 framework launches on 1 July, The Register has reported.

The firm has this week given UK resellers and customers a preview of the new look price list, also due to kick in at the start of July, confirming hikes of more than a third as it aligns licensing prices across the EU to the Euro.

In a note sent to customers and seen by The Register, Microsoft confirmed the cost of Enterprise Agreements will rise by an average of 25% and Select Plus deals will be 24% more expensive.

On average, prices across the volume licensing SKUs for corporate and government customers - except in education - will climb 29%.

Reliable channel sources, who sat on a call with Microsoft large account reseller manager Edward Hyde, told The Register that public sector customers would see no rises.

"Microsoft has told us that the PSA12 will be heavily discounted and the net affect is that the public sector will not see an impact from EU price alignment, it will be entirely offset," said a Microsoft reseller.

The Cabinet Office only lifted a six month moratorium on Microsoft purchases in the NHS last December, after settling on a discount of 16% on the soon-to-expire PSA09.

Sources say Microsoft did not want to upset Cabinet Office minister Francis Maude and the government's Efficiency Reform Group by raising prices at a time of austerity.

Asked for comment on the matter, Microsoft said in a statement to The Register: "The Cabinet Office and Microsoft will provide a further update shortly regarding pricing and licensing for the UK government, to replace the PSA09 framework. In the meantime we can confirm that the terms of the PSA09 framework will remain in place until 30 June."

A Cabinet Office spokeswoman echoed the statement, adding: "The Cabinet Office and Microsoft will provide a further update shortly regarding pricing and licensing."