Jeff's Connected Corner

Windows Server System news and real-world info

Better Together, With a Catch

It's hard to miss the 'Better Together' message in Microsoft's product launch frenzy.  However, for the first time one such 'Better Together' scenario is going to cost you extra.  I'm referring to the removal of Outlook 2007 client software from the Exchange CAL.  Previously, when a customer purchased Microsoft Exchange server licenses, and the appropriate number of CALs, they received a copy of Outlook along with each CAL.  Well, technically they acquired the right to run Outlook... the software itself had to be ordered through Worldwide Fulfillment or via Volume License mailings/downloads.  But regardless, if you owned Exchange Server 2003 and Exchange CALs - Outlook 2003 client software was included at no extra charge. 

This held true even if you didn't own the entire Microsoft Office suite, or were running a previous version of Office.  I've participated in many Exchange 2003 deployments where customers rolled out Outlook 2003 alongside Office 2000 or Office XP (usually for benefits such as cached-mode and RPC/HTTPS).  This version mismatch had a few minor issues, such as the inability to use Word as the Outlook e-mail editor.  However, in most cases it wasn't a show-stopper.

Well - those days are officially over.  Unless your Exchange CAL Software Assurance was current as of November 30, 2006 - an upgrade to Exchange Server 2007 and Outlook 2007 might cost more than you expected.  The official announcement is buried in the Product Use Rights section of Microsoft.com (scroll down about half way to the sub-heading "Outlook 2007 grant for Exchange Server 2003 CAL customers").  I've included the relevant text below for completeness:

Exchange Server 2007

Outlook 2007 grant for Exchange Server 2003 CAL customers
Unlike prior versions, Exchange Server 2007 Standard or Enterprise does not include the right to install Outlook on devices for which CALs are obtained. However, for each Exchange Server CAL, Core CAL Suite or Enterprise CAL Suite with active Software Assurance coverage as of November 30, 2006, customers will be granted one Office Outlook 2007 license. The right to use Outlook under that license expires upon expiration of the corresponding CAL. Use of Outlook under this offering is subject to the customers’ license agreement and the product use rights for that product. If Software Assurance coverage on the corresponding CAL is maintained continuously (i.e., renewed with no lapse in coverage), and one later version of Office Outlook (i.e., N+1, where N=Office Outlook 2007) is made available prior to the expiration of that coverage, customers’ license will be for that version instead. Alternatively, customers are eligible to acquire Software Assurance coverage for that Office Outlook license, provided that coverage is acquired by February 28, 2007. Customers who wish to acquire Software Assurance coverage for Office Outlook after that date must first acquire a new license for the version of Office Outlook that is current at the time coverage is acquired.

A couple things strike me as odd about this decision.  First, it isn't well-publicized on the main Exchange 2007 web site.  I can find plenty of 'Better Together' articles that extol the benefits of running Exchange 2007 with Outlook 2007 (herehere & here for example).  However, not one of them mentions the licensing change above.  Heck, the change isn't even spelled out in the Exchange Licensing FAQ.

Second, without Outlook 2007 - what exactly does Microsoft expect clients to use to access Exchange 2007?  OWA?  Previous versions of Outlook?  It just doesn't make any sense to me.  Outlook 2007 rocks... so why create another deployment blocker?

What are your thoughts on the Exchange CAL changes?  Will this impact your deployment, or were you planning to roll out the entire Office 2007 suite anyway?

Only published comments... Dec 19 2006, 11:52 PM by Jeff
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Comments

 

Josh Phillips said:

Intresting.  I think this could hurt the Small/Medium sized business that might not have been able to afford the entire Office suite, but was still running Outlook as  a Mail client.  I am not sure how big that audience is, but it has to be some number of clients.

The other impact for companies might be how support is done.  Typically Outlook support was oftered under the exchange umbrella, I think because of this "free" usage.  This might change that relationship and force companies into larger support agreements.

December 20, 2006 6:32 AM
 

Peter said:

This really stinks.  We are a small office (<50 users).  We were running Outlook 2003 with Office 97 for a while.  We are not heavy into document creation so the new features of Word and Excel don't mean much to us.  The new features of Outlook, however, are very enticing.  We are now using Office 2003 so convincing management that we should purchase Office 2007 for everyone just to get Outlook 2007 is going to be a hard sell.

With what they charge for the Exchange CALs, AFTER you have already purchased the Exchange server software, the server OS software and all the desktop software, the least they could do is throw in the Outlook licenses.  This is just going to push people to use OWA on the desktop.

December 20, 2006 7:17 PM
 

todd brooks said:

Since Exchange 2007 will run only on 64bit hardware and 64bit operating systems, how does this affect the next version of Small Business Server?  Will it be required to run on 64bit also?  if so, how does that benefit small businesses?

December 29, 2006 10:00 AM
 

Jeff said:

Todd - yes, the next SBS will be 64-bit only.  As for tangible business benefits... I'll reserve comment until the product hits public beta.

Danielp - that is correct.  Now, if only non-SA customers could find some spare plutonium for their flux capacitors and travel back in time...

December 29, 2006 9:49 PM
 

Mail System Admin. said:

They don't expect you to use any other client, they expect you to fall in line and buy Software Assurance, no matter how worthless it is. Rather than actually add value to SA, they're creating the illusion of it by reducing the value you receive without it.

If they want to charge for it (Outlook 2007) separately, fine, but then the price for an Exchange CAL should go down by the same amount as the license cost of Outlook. But playing fair means you can't just print money whenever you want.

December 30, 2006 3:04 PM
 

Chuck D said:

In the next update of SBS will Exchange still be included?

December 31, 2006 7:46 AM
 

tim said:

This is lunacy. The only reason Microsoft is able to do this is over it's monopoly. OWA is looking better and better.

January 1, 2007 5:44 AM
 

CIO KB said:

Why does MS does this?  It is because they can, they will, and they have done it before.  Remember when SQL was removed from the Core Cal and replaced with SPS?)  Well, mark my words - they day will come with the Core Cal will drop the SPS Cal...just mark my words!

We are a small/med business (750 employees) and I bought into the EA idea about 6 years ago.  We have spent A FORTUNE on EA...have we received anything from it?  I am not sure that it has been worth the cost.  In our case, we did it to get our licensing "in-line".  It is (and still is) too easy install product without proper licensing.  Don't misunderstand - I HATE paranoid software companies that force you install a dongle on the printer port just to run their software; that is overboard lunatic impulsion.

So - what does MS want us to do?  Obvious:  spend more money...period.  Get more value - let the marketing folks beat that into our head.  Ex2k3 is good - real good.  It's a shame that it can't last forever, or at least until there is a return on investment (ha!)

January 2, 2007 5:18 AM
 

Angry Small Business said:

I am also from a small business of less than 50 persons and this is a show stopper for me. I was just researching a replacement for my single aging server running e2k3 when I ran across this announcement. Getting o2k7 was a deciding factor in "transitioning" to e2k7 for me but now I will just stay with 2k3 for a while. I was also going to have to purchase a Windows Server 2003 x64 to go with it but now there is no need so I will move my x32 license over. I already wasted my money on SA before and got nothing out of it so I guess this means there's $4k I budgeted that will go to someone else besides Microsoft. It may not seem like much but I'm sure I'm not the only little guy that's thinking like this.

January 9, 2007 12:49 PM
 

Fortune 100 Customer said:

We met with our MS Account Exec and Licensing Exec multiple times last fall to ensure our strategy and budget would enable a Exchange 2007 upgrade this year, not a word of this change was ever mentioned.  Either the mother ship left her children out in the cold or this was a calculated strategy!  Either way, no upgrade and we're within our rights to return quite a large CAL purchase.  

January 18, 2007 4:04 PM
 

Ely said:

This is rotten. We are a small business of 80-100 users about ready to purchase our first exchange server. Now another $8000-10000 for Outlook 2007? Well, I can tell you that won't happen--my boss would never agree to that. So what now? OWA most of the company.

We are already in the process of migrating certain users to OpenOffice. This announcement only makes me that much more determined to keep this going. I can't for the day when we can dump MS Office entirely. As a sys admin, I am completely fed up with all this licensing flim flam from Microsoft.

Note to OpenOffice developers! We need a new email client!!!

January 30, 2007 3:49 PM
 

CIO KB said:

I N T E R E S T I N G:   A company can change their licensing at will, at any time they choose, and create any type of licensing language they desire ...  AND IT IS COMPLETELY LEGAL.  

There are no statutes regarding the structure of licensing - at least in the sense that MS can choose at will whether to "give it away" or "make you pay for it".  Period.  

So, when they do change their licensing, all we can do is *** and moan about it, but we can't do anything else about it.  We can use another Office product, but what a pain in the a$$.  And MS knows that it is.  That is why they very keenly figure out their potential losses and gains on their licensing language.

Now here is the twist:  My company has paid big $$ for many years to be a part of the MS EA Licensing program.  Have received the benefit? ...it is very hard to say.  

I hope that someday, there will be sometime of legislation that defines how software should be licensed - and EVERYONE follows the same definition.  We have 100's of different software licenses - and not a damn one is the same.  Are in 100% compliance?  ...I doubt it, but it isn't because we were knowingly negligent!  But at the same time WE WILL NOT HIRE AN ATTORNEY AND AUDITOR just to ensure our compliance.  The software companies make it financially impractical to stay "in compiance" because everyone's licensing is so different.  ...AND THEN MS HAS THE BALLS TO KEEP CHANGING THE DAMN RULES WHEN THEY FEEL LIKE IT!

I hate MS for their licensing and hope they fall on the own pile of crap one day.

February 2, 2007 7:29 AM
 

Rich said:

Well we recently decided to upgrade our Exchange 5.5 server to Exchange 2007, and were told that it came with Outlook 2007, but on install day we find out that it isn't included.  I wish we could return it and get Exchange 2003, but I don't see that happening.

June 21, 2007 3:02 PM

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About Jeff

Jeff Centimano is a Windows Server MVP based in Fairway, KS (USA). In addition to blogging and freelance technical writing for Microsoft, Jeff leads the KC-MEC User Group (kcmec.org) and assists with various site duties here at WindowsConnected.com. Jeff has been in the IT industry since 1994 and is currently a Solutions Architect at EMC Global Services.
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