Microsoft adjusts online services terms for licenses

Microsoft adjusts online services terms for licenses

Microsoft has revised its online service terms (OST) to make them simpler, to remove redundancies and to clarify several provisions about which Microsoft often receives comments and questions from customers, the company recently announced.

The document replaces Microsoft's "Online Services Use Rights" document for volume licensing customers using its hosted services starting on July 1, 2014. It lays down the terms for using Office 365 product offerings, including Exchange Online, Lync Online, Office Online, SharePoint Online, Windows Intune and other services for Microsoft's volume licensing customers. It also describes privacy terms, license transfer restrictions and data retention terms, along with the core features of the services that Microsoft pledges to support throughout the subscription term.

In addition, Microsoft is pledging that it offers the "best terms for privacy and security across all online services," according to a blog post.

Most important for organizations, Microsoft's OST document promises to apply its terms for the duration of the subscription. "Microsoft now commits to the terms of this OST for the duration of the Customer's subscription for each Online Service," the OST document states.

Enterprise Agreements associated with Microsoft's volume licensing may last about three years, so that's a relevant change. The point is underscored in recent licensing research published by Directions on Microsoft, an independent consultancy based in Kirkland, Wash. The Directions on Microsoft document, "Online Services Licensing Documentation Redesigned" (subscription required), explains that Microsoft's previous "Online Services Use Rights" document just established terms for online services for up to one year at most.

The OST document also spells out Microsoft's commitment to maintaining "Core Features" with some of its services. However, it's a spare list. For instance, Lync Online (p. 17) only lists instant messaging, presence and online meetings. There's nothing about maintaining enterprise voice. Similarly, with SharePoint Online (p. 19), Microsoft is only committed to supporting collaboration sites and storage features. Such lack of specificity could give some organizations pause.

"Regarding core features, yes the lack of specificity means it is possible (though you could argue how probable) that future technical changes could cause the service to no longer meet a customer's needs," commented Rob Horwitz, cofounder of Directions on Microsoft, in an e-mail.

"And yes, with on-premises software, established product life-cycle policies mean that the time period between a major change and the point when use of the existing deployed software becomes untenable (for support or other reasons) is usually at least several years, which is more than adequate for customers to plan for and execute a transition. As online services policies now stand, it is possible that forthcoming disruptive changes don't leave an online services customer with sufficient time to execute an orderly transition before the subscription lapses."

Microsoft does offer a specific promise with regard to features supported through Microsoft Azure Services. It promises (p. 14) to give customers "12 months' notice before removing any material feature or functionality or discontinuing a service," unless compelled to do so by legal considerations or security or performance considerations. However, that stipulation doesn't apply to previews.

Things are just different with Microsoft's Online Services licensing compared with the more traditional perpetual licensing, according to Wes Miller, an analyst at Direction on Microsoft.

"In terms of support, Office 365 subscribers should remember that they are subscribing to a service, rather than buying a perpetual license," Miller stated in an e-mail.

The new OST document likely represents a step forward. Horwitz described it as "easier to navigate than its predecessor," for instance.

"The reorganization means customers and partners can find information faster, and the document may be less intimidating to first-time users," he said. "However, the OST largely preserves existing online services licensing rules, and thus understanding licensing requirements, options and compliance remains as challenging as before."

A longer version of this article appeared on Redmondmag.com, a sister site to GCN. 

Reader Comments

Fri, Jul 18, 2014

On Thursday July 2014 Microsoft announced that it will cut 18,000 jobs of which 12,500 will be from its recent acquired Nokia's phone division. http://goo.gl/sMRVBf

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