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Microsoft partners like simple Windows Server 2008 SKUs

Windows Server 2008 will have the same pricing and licensing structure as Windows Server 2005; Microsoft partners say that will make it less confusing and complicated to sell upgrades.

According to channel partners pleased with the anomaly, Microsoft Corp. is being unusually lucid about the pricing and licensing for Windows Server 2008. Both will follow the same model as the one in place for Windows Server 2005 SKUs. That's good news to Microsoft partners, who said the simple structure will reduce confusion when pitching upgrades to customers.

Microsoft announced this week that Windows Server 2008 will have the same three main editions as its predecessor: Standard, Enterprise and Datacenter. The only major change between Windows Server 2005 and Windows Server 2008 is that customers will be able to choose whether they want it to come with or without Hyper-V -- the new name for Microsoft's virtualization hypervisor, formerly known as Viridian or Windows Server Virtualization.

Some Microsoft partners said they were concerned that Microsoft would come out with a whole new set of SKUs for Windows Server 2008 and Hyper-V.

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"Microsoft is always doing things that have you shaking your head and saying, 'Why the heck did they do that?'" said Rand Morimoto, president of Convergent Computing, a Microsoft partner in Oakland, Calif. "This was a surprise that it wasn't a surprise. It's just like before. That makes it so much easier."

When talking to customers about upgrading, Microsoft partners won't have to go through the trouble of telling them what the new version of their current Windows Server product is called, what the different features are or how the licensing works. Alan "Skip" Gould, CEO of BrightPlanIT, a Microsoft partner in Buffalo, N.Y., said those factors will "absolutely" make it easier to sell Windows Server 2008.

"They're outlining it clearly, and that's not always the easiest thing for Microsoft to do," he said.

The worldwide launch of Windows Server 2008 is scheduled for February, but Microsoft has not announced ship dates for each edition. With official announcements from Microsoft few and far between, this week's news was promising for Microsoft partners and customers, Gould said.

"They needed to do something, so I'm glad they finally made an announcement," he said. "We had a lot of customers who were waiting. … We'd be happier if we actually saw the product, but I'm glad they're taking their time and doing it right."

But the longer that Microsoft waits to announce further details about ship dates and Hyper-V's specific features, the higher the risk of losing customers, said Chris Ward, a senior solutions architect with GreenPages Technology Solutions, a Microsoft and VMware partner in Kittery, Maine. Two of his customers who originally said they were going to wait for Windows Server 2008 and Hyper-V have since signed licenses with VMware, the server virtualization market leader.

"There's definitely some customer apprehension out there," Ward said. "As the clock ticks, [Microsoft is] just falling farther and farther behind."

The Standard edition of Windows Server 2008 with Hyper-V will cost $999 with five client access licenses (CALs); the Enterprise edition with Hyper-V will cost $3,999 with 25 CALs; and the Datacenter edition with Hyper-V will cost $2,999 per processor.

The editions without Hyper-V will have a price tag just $28 lower -- a Microsoft tactic to get as many customers as possible to buy Hyper-V, Ward said.

"Who's going to save 30 bucks?" he said. "Everyone's going to buy it."

Convergent Computing is also a VMware partner, and Morimoto said some of his customers spend between $100,000 and $250,000 on licensing for VMware's ESX Server. Microsoft's product and pricing strategies for Windows Server 2008 should be major selling points for Microsoft partners, he said.

"It opens up huge doors," he said. "This will be great that it's included in the OS."

Microsoft also plans to sell Hyper-V as a standalone product after Windows Server 2008 ships. That will further help Microsoft and its partners compete with VMware, Morimoto said.

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