Microsoft’s partners appear to have pushed back against Redmond’s “new commerce experience” licensing scheme, as the software giant noted a slower-than-expected transition to the arrangement in its Q3 2022 earnings.
The company today announced typically robust results: Q3 revenue reached $49.4 billion, an 18 per cent year on year jump. Cloud revenue jumped 26 per cent to reach $19.1 billion, with Azure and other cloud services growing 46 per cent.
Dynamics grew 22 per cent. Office’s commercial incarnation increased revenue by 12 points, one ahead of Office’s consumer services. LinkedIn grew by 34 per cent. Windows surfed the PC boom to record 11 per cent growth from sales to computer-makers, while commercial Windows products added 14 per cent to Q3 2021’s revenue haul.
The company remains wildly profitable. Net income was $16.7 billion – an eight per cent improvement.
All the numbers above would have been even better had it not been for exchange rate shifts – and if partners had been more enthusiastic about Microsoft’s newish licensing arrangements.
The licensing scheme was announced in September 2020, when Microsoft pitched “a simplified approach and greater flexibility in how you purchase software licenses in a way that’s easy to understand, that directly improves licensing asset management, and with predictable costs.”
The scheme de-emphasized sales of perpetual licenses in favor of a “new commerce experience” that focuses on fixed-term subscriptions to cloudy products and makes paying month-to-month more expensive.
But the scheme has worried some members of Microsoft’s partner community, who fear it could leave them on the hook for some customer purchases.
Source: The Register