Distributors bank on licence bonanza
C2000 and Ideal aim to help resellers cash in on MSA renewals
Millions of pounds will be heading VARs' way as customers rush to renew their Microsoft Software Assurance (MSA) contracts.
The MSA scheme was launched in spring 2002, and distributors Computer 2000 (C2000) and Ideal Enterprise Solutions have predicted that 2004 will create major renewal opportunities.
Both are offering online tools to help resellers identify MSA customers that need to renew contracts.
C2000, the UK arm of Tech Data, is offering a Licensing On Line (LOL) tool that allows resellers to search the renewals database and extract details.
It is also preparing materials that can be tailored by resellers with their own branding, explaining the benefits of the scheme.
Richard Hales, general manager of C2000's software business unit, told CRN: "The new licence was particularly well received, as Microsoft included some historical upgrades you wouldn't normally receive.
"This meant software revenue was probably two to three times bigger than in a typical month."
Mark Johnson, Ideal's general manager of software, said its online licensing tool focuses on the benefits of the licences and how to sell them, and provides XML links to Microsoft.
"Ideal has stored all its information in a pool which all our resellers can look at. They can then go out there and sell proactively," he said.
He added that in July 2002, the company collected £20m in licensing revenues as a result of the scheme.
"Ideal has about 45 per cent of the Microsoft licensing opportunity," he claimed.
"Since then, Microsoft has added lots of tools and services such as technical support. Just through Ideal, probably £30-£40m can be renewed."
However, resellers were more cautious about the opportunity.
Nick King, managing director at VAR Apex, said: "Resellers know all about the renewal cycle. But I certainly wouldn't call it a cash cow.
"The margins are so diluted, you are looking at single digits. But there is still an opportunity to get some significant renewal deals, depending on your strategy."