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By Felicity Ussher, 16 June 2000 00:15

NEWS Microsoft's new software licensing scheme could clash with anti-trust authorities if it becomes compulsory for businesses to pay for their server software by chip, instead of per user seat. The company's new licensing model, announced this week, offers businesses the option to pay for software in relation to their processing power, rather than by the number of people using the software. The licensing model is already used by most enterprise software vendors. But this week's Behind the Headlines panel said Microsoft - as a dominant player in the market - was different to the rest. It must keep its scheme optional - or else risk the wrath of the European Commission. Alistair Breward, partner, Taylor Joynson Garrett, has been following the EC's investigation into Microsoft Windows 2000. He said: "A brief review of the Microsoft site this morning suggests that the option of per-seat pricing will remain available. Now certainly if that's the case then there's no decrease in choice, and I can't see an anti-competitive effect of this." Breward added: "But one does have to have an eye on the future. And if we see a move to only per-server, per-processor licensing, then there may be a connection." The debate was prompted by Geoff Petherick, CEO of IT user group, UKCMG, who feared Microsoft would make the new per-chip licences compulsory for businesses. Mike Owen, technology analyst at DataMonitor, said that from Microsoft's view-point, it was a good strategy. He said: "Large enterprises and medium enterprises are used to paying for per-processor software, and it's only now that Microsoft are making more and more of an impact in the enterprise, and the medium and larger enterprises, that they're fitting with the rest of the industry." Owen added that Microsoft was likely to embrace the model further, and perhaps extend it to application service providers. This week's Behind the Headlines also looks at the furore in the Lords over the RIP Bill.