In a deal that's being touted as the broadest academic licensing agreement yet forged by Microsoft Corp., Indiana University has agreed to an exclusive four-year, US$6 million contract that gives its 100,000 faculty, staff, and students the run of Microsoft's most popular desktop and network software products.
"Never have we had an institution that has committed for four years. Nor have we in the past done a similar agreement that provides this broad of [an] access for the people in that institution," said Aleisa Spain, director of higher education marketing at Microsoft. "This is very significant on Indiana's part."
Microsoft is making it clear that the deal, announced last week, won't be the last of its kind. The software superpower plans to unveil a new educational institution licensing agreement structure this summer. And while the letter of the contracts will be different, the spirit will be the same, said Spain.
But if Microsoft is looking forward to similar contracts, it can also expect plenty of criticism.
"There's usually a PR problem for Microsoft in universities," said John Robb, a software industry analyst at Gomez Advisors. "Academe tends to be a hotbed of anti-Microsoft sentiment."
That sentiment has already reared its head on Indiana University's eight regional campuses, where students and faculty are criticizing both the deal and the means by which it was reached.
"I think it is, in the long run, going to be really bad for diversity and choice of software and operating systems," said Brian Bothwell, a graduate student in computer science at Indiana's main campus, in Bloomington.
Bothwell noted that the deal has loosed a torrent of complaints on university-related newsgroups, and protests are contemplated.
Under terms of the agreement, faculty, staff, and students will receive copies of Microsoft Office, FrontPage, Visual Studio, Exchange, Outlook, and 32-bit upgrades for Windows 95 and NT. Information technology staffers will also receive free access to NT, SQL, and Exchange server products. Upgrades will be free.
The deal will be paid for by student technology fees and other state funds, and the university is promising that fees won't increase as a direct result of the contract.
University officials say the deal will allow the school to offer much broader access to the software that students most want.
"It's not going to limit people. Some will want to continue using what they already have installed, and they'll be able to do that with their own departmental or individual funds," said Brian Voss, the university's director of teaching and learning information.
But others question whether faculty and staff will be able to justify purchasing competing products.
"It's going to be very hard for people to go against that grain," said Nathan Newman, program director of NetAction, a consumer advocacy group that has fought Microsoft's proposed CETI project with the California State University system.
The Indiana University contract is "not as bad as CETI," noted Newman; but it is nonetheless problematic.
"This is a situation where a monopoly on the desktop is being reinforced at the Universities," said Newman. "As people graduate into the work force, they've been trained on Microsoft products. This has thus become a kind of government-backed Microsoft training ground; Microsoft will be the de facto standard for much of the state."
Analysts agree that the contracts such as the one negotiated between Microsoft and Indiana University spell bad news for competition.
"Usually young college folks, they're buying a computer for the first time," noted Gomez Advisors' Robb. "If they start off using Microsoft software, they're going to probably stick with that for life.... And when they get to positions of power at corporations, they'll expect Microsoft products."
Although university officials say that they will continue to negotiate licensing contracts to offer other competing software products to faculty, staff, and students, it's not clear they're putting their money where their mouths are.
Voss said Indiana's contracts with Corel Corporation and Novell Networks - which have provided similarly broad access to WordPerfect and NetWare software - will both be abandoned when they expire later this year.
"WordPerfect has been a good product for us; but their pricing structure was going to increase dramatically - twofold to fourfold," said Voss. "We were the first to get the Novell agreement, and they've likewise since restructured it and raised the price.... The Microsoft opportunity seemed a better one for us."
Despite Voss's statements, representatives from Corel and Novell were not concerned. Jennifer Robinson, education program manager for Corel, noted that the company sold 120,000 copies of WordPerfect to the university in December. Ed McGarr, Novell's vice president for product marketing, declined to discuss any ongoing deals with Indiana but noted that his company offers "very attractive and more-than-competitive site licenses for educational institutions."
