Microsoft Drives More Value to Enterprise Computing

REDMOND, Wash., Oct. 19, 2004 — Microsoft Corp. today announced its decision on how the company will license server software on new servers with multicore processors expected in the market next year. Microsoft software that is currently licensed on a per-processor model will continue to be licensed per processor, not per core, for hardware that contains dual-core and multicore processors. This policy is effective today and applies to several products in the Windows Server System (TM) family, including Microsoft® SQL Server (TM) , Microsoft BizTalk®
Server and others. Microsoft is approaching this decision with the goal of driving high volume and high value to standards-based computing through logical licensing and more cost-effective adoption of multicore processors.

Today’s announcement allows customers to benefit from dual-core technology with no change to the licensing or edition requirements of Windows Server (TM) and Microsoft enterprise server software. For example, Microsoft SQL Server Standard edition will run on a four-processor server with dual-core processors, utilizing all cores on the processors, without requiring more than four licenses. The same number of licenses will be required whether SQL Server software is running on a server with dual-core or single-core processors.

Dual-core processors, which consist of two processing execution units or cores on one chip, are widely seen as a promising way to boost computing power, allowing servers, workstations and PCs to perform more functions simultaneously. In 2005, both Intel Corporation and Advanced Micro Devices Inc. (AMD) plan to deliver dual-core processors for industry standards-based server hardware, and both companies’ product road maps include plans for multicore processors. Intel revealed its commitment to moving ahead with dual-core processors, saying that by the end of 2006 it expects more than 80 percent of its server products to be shipping with multicore technology.

“Our customers want to understand software costs as they evaluate the return on investment of new technologies, such as multicore processors,” said Brent Callinicos, corporate vice president of Worldwide Licensing and Pricing at Microsoft. “Working alongside hardware and chip partners, Microsoft is leading the way for customers of all sizes to take advantage of multicore technology so they can adopt the advances of industry-standards-based computing into the enterprise.”

“Multicore technology is a natural next step in delivering the benefits of Moore’s Law to computing platforms,” said Deborah S. Conrad, vice president and director of the Solutions Market Development Group at Intel. “In deciding to license software by processor and not by core, Microsoft is making an important move to make the benefits of multicore platforms readily available to all customers. Just as Intel Hyper-Threading Technology helped provide broad access to the multitasking and performance gains of parallel computing, our focus on dual-core and multicore desktop, mobile and server platforms will provide a foundation for next-generation solutions to home and business customers worldwide.”

Microsoft Windows Server 2003 and the associated Microsoft server applications that currently operate on today’s server hardware will also run on tomorrow’s hardware with dual-core processors. This was recently demonstrated by AMD on an HP ProLiant DL585 server powered by four dual-core AMD Opteron (TM) processors and running a Microsoft Windows Server 2003 operating system

“AMD is relentlessly committed to preserving the IT manager’s investment in the enterprise, and Microsoft’s multicore software decision aligns perfectly with AMD’s focus on customers,” said Marty Seyer, corporate vice president and general manager of the Microprocessor Business Unit, Computation Products Group, at AMD. “AMD Opteron single-core processor-based systems will be upgradeable to multicore hardware and software, allowing businesses to run their existing applications without having to replace their servers.”

“Heretofore, software licensing models have lagged advances in technology. What we’re seeing today is a willingness to continue licensing server products on a physical processor basis and not exploit dual and multicore technology to garner additional licensing revenue,” said Alvin Park, research director at Gartner. “The position that multicore technology is but another example of the ever-increasing power of X86 technology and should continue to be licensed on a per physical processor basis is a positive development for customers. Software vendors throughout the industry would do well to take notice of this position.”

More information about Microsoft’s licensing policy may be found at http://www.microsoft.com/licensing .

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

Microsoft, Windows Server System, BizTalk and Windows Server are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

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