Microsoft Offers Free Software to Startups
Microsoft today announced that it will give away software and services to qualifying software startups as part of its newly announced BizSpark initiative. To qualify for this program, a startup has to be privately held, in business for under three years, and generate less than $1 million per year in revenue. Once accepted into BizSpark, enrollment is free, but the startups will have to pay a nominal fee of $100 when they leave the program.
Those companies that are accepted into the program will receive a full suite (PDF) of Microsoft's server and development packages, including Windows Server, Office Systen 2007, the Visual Studio System Team Suite, Expression Studio, a CRM solution, and access to Azure, Microsoft's cloud computing platform. Microsoft will also provide extensive development and marketing support to these companies.
Fighting Free With Free
Clearly, this is also a program that is meant to create more goodwill towards Microsoft in the developer community. For a lot of tech startups, running Windows is often not even a consideration, as they are already building their software on top of free software anyway. As Om Malik points out, the idea of using Microsoft software often didn't even cross his mind when he started his business.
It is good to see that Microsoft is trying to gain some market here. However, it seems that Microsoft is trying to fight the free software movement by giving away its own programs, while a lot of developers prefer software that is not just free, but also open source.
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This is called a loss leader. It isn't about free... it is about getting entrenched in startups early and ensuring that is a prohibitive switching cost. Once the get "big" you can bet the MS bill collector will show up looking for payment.
Brian - absolutely - but the question will be if startups are even interested in this, given that they can already built their businesses on top of free software anyway.
This is the way to fight with free Linux. Smart move from Mircosoft.
Nice move from Microsoft, but once more I have the feeling that MSFT does not really have a unified strategy in this field. I have come across several projects that are supposed to help startups (from paying your SSL certificate to this) and its kinda of confusing which will eventually work for you (..and MSFT of course)
Here is the guide from Microsoft
http://www.docstoc.com/docs/2404033/Microsoft-BizSpark-Program-Guide-for-Startups
What's the effect of this if you try to sell the company? You're setting the price to a potential acquirer at whatever you want, plus whatever the company that buys yours will have to pay to get all the needed MSFT licenses at the big company price.
Free which is not in the dictionary of Microsoft now offering free shows pressure from open source
good move by microsoft
This is a very good move from Microsoft and could make a lot of companies think. Probably not web companies but remember that in many industries Microsoft is still dominant with developers.
I think it is these industries (like the game development industry for example) where MS wants to first secure its position and perhaps Companies were looking to start moving to free software.
They will also be aiming at MBAs who form businesses I would assume, as they are accustomed to the full MS suit of tools in the big companies they have worked for and perhaps dont realize they can get everything they use for free elsewhere.
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