• Colin Doyle CFO

Microsoft's strategy: Force enterprises to buy every traditional Office upgrade

Microsoft has figured out how to stymie enterprises that cut costs by licensing Office the old-fashioned way, a pair of researchers said.

After changing the end-of-support for Office 2016's right to connect to cloud-based services, rolling out Office 2019, pledging to continue the "perpetual" license model, and reducing the suite's support timeline, Microsoft has put an end to organizations' work-arounds, argued Stephen Kleynhans and Michael Silver, two Gartner analysts who authored an October report on the Redmond, Wash. company's latest round of support policy alterations.

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"Organizations that want to run the traditional version of Office with Office 365 will need to license every version without skipping," Kleynhans and Silver wrote about the impact of Microsoft's latest announcements. "This would ensure Microsoft a continuous revenue stream for Office."

In September, Microsoft changed its ma a three-year extension of the original October 2020 cut-off. The 2023 date was also set as the end of support for Office 2019's ability to access services such as Microsoft-hosted Exchange and OneDrive for Business storage.

Microsoft first laid down these rules in April 2017. They applied only to the traditional Office, the suite with a perpetual license - called that because the right to run the software never expires; it's the bundle purchased with one-time payments, as opposed to the ongoing fees forked over to run Office applications under an Office 365 subscription.

Experts saw purpose in the Office-to-services limitation Microsoft instituted. In a 2017 interview, Gartner's Silver portrayed the decision as another shove to subscriptions. "The writing has been on the wall," he said of Microsoft's downgrading of perpetual Office.

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