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Licensing Costs

Organisations must ensure that they hold valid licences for all deployed software. Failure to manage licensing properly, can and often does, result in heavy fines. Licences vary in price, but bulk buying will reduce costs per licenses. All installed network operating systems must have a licence per user and per machine. Applications software, even though installed on a central server and distributed across the network, must have a license purchased per user. Some licences are calculated on the basis of the machine that is running the software.

Recently, the development of ASPs (application service providers), are changing the way licensing works. ASPs offer users the chance to operate on a pay-per-use basis - renting out software rather than charging a flat fee for installation on a company's own systems. This method is causing traditional licensing to undergo significant changes in the industry. Users of Microsoft’s Office 10 offers a simple choice for users: they can either acquire Office on an open-ended licence for a single payment as normal, or make a much smaller down payment followed by an annual subscription. This would entitle the user to all updates and point revisions automatically. At the end of the 12-month period, users have the option of renewing their subscription. If they choose not to, Office allows existing documents to be viewed and printed, but nothing new can be created or saved.

Licensing has become a very complex and confusing area for network administrators to manage, now that the conventional method is undergoing such change. In the ensuing disorder, one thing is for sure; this is an inescapable and costly requirement.

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