Discount-licensing.com
Encyclopedia
Discount-licensing.com (formerly known as Disclic) is a Burton-upon-Trent, UK-based vendor or broker
of second hand
Microsoft
software licences. It is notable for being the first company to establish a secondary market
in such licences which is accepted by Microsoft as being valid.
When Discount-licensing.com launched, it was predicted that it, and other companies like it, would have a significant "disruptive
" effect on Microsoft's pricing and its resellers and some resellers reacted with shock and anger however this disruption has not materialised and the second hand licence market remains small compared to the primary market. Only a few other companies, such as German firms UsedSoft, preo Software and Susensoftware and British firm Value Licensing have sought to enter the market for second hand Microsoft software. Instead the second hand licence market exists as a smaller "parallel market" selling to companies who require licences for specific previous versions of Microsoft products, or who might not otherwise have purchased licences due to the cost
s of companies which have ceased trading or which are downsizing their IT requirements. These are then sold on to customers at a discount to the cost of new licences. This allows customers to purchase licences for non-current as well as current Microsoft versions, which they may have standardised on.
Only Microsoft products with licences that permit transfer (either explicitly or by means of legal loopholes in the licence) are offered. These include Microsoft Office
, Windows Server
licences and Client Access License
s, Microsoft Exchange
and Microsoft SQL Server
but exclude any desktop versions of Windows
or any rights under Software Assurance
.
The actual licence transfer can sometimes be facilitated directly between the original owner and the new owner, without Discount-licensing.com taking ownership of the licences. Licences are supplied in the form of licence agreement numbers which the recipient can register in Microsoft Volume Licensing Service Center in order to obtain the volume license key
s. Following the completion of all paperwork, Microsoft updates it records to reflect the new user, but note that the VLSC does not necessarily show the legal owner. In the case of licences created after October 2007, the sale may sometimes require the creation and transfer of a "shelf company" which owns the licences.
Only whole licence agreements can be transferred so the customer has to choose from the agreements available and may not be able to obtain exactly the combination of licences desired.
The company operates internationally and, following advice from Microsoft that it was permissible, has transferred licences between countries.
in the provisions for divestiture in its pre-2007 licence agreements. In October 2007 Microsoft introduced a clause prohibiting resale of all types of licences into its EULAs. This was intended to prevent licences sold after this date from being resold, however a further loophole was found to enable licences to continue to be sold, albeit in a more complicated way. Despite this game of cat and mouse
, Microsoft accepts the legality of Discount-licencing.com's business model and Discount-licencing.com remains a Registered Microsoft Partner and authorised Microsoft Reseller. Discount-licencing.com describes its relationship with Microsoft as "fairly good".
Broker
A broker is a party that arranges transactions between a buyer and a seller, and gets a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal...
of second hand
Second Hand
Second Hand is the title of an album by Mark Heard, released in 1991, on Heard's own Fingerprint Records. The album was listed at #4 in the book CCM Presents: The 100 Greatest Albums in Christian Music ....
Microsoft
Microsoft
Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...
software licences. It is notable for being the first company to establish a secondary market
Secondary market
The page applies to the finanical term; For the merchandising concept, see Aftermarket .The secondary market, also called aftermarket, is the financial market where previously issued securities and financial instruments such as stock, bonds, options, and futures are bought and sold....
in such licences which is accepted by Microsoft as being valid.
Company history
Discount-licensing.com was founded as Disclic Ltd in July 2004 by Jonathan Horley and Noel Unwin. In 2006 Disclic Ltd changed its name to Discount-licensing.com Ltd.When Discount-licensing.com launched, it was predicted that it, and other companies like it, would have a significant "disruptive
Disruptive technology
A disruptive technology or disruptive innovation is an innovation that helps create a new market and value network, and eventually goes on to disrupt an existing market and value network , displacing an earlier technology there...
" effect on Microsoft's pricing and its resellers and some resellers reacted with shock and anger however this disruption has not materialised and the second hand licence market remains small compared to the primary market. Only a few other companies, such as German firms UsedSoft, preo Software and Susensoftware and British firm Value Licensing have sought to enter the market for second hand Microsoft software. Instead the second hand licence market exists as a smaller "parallel market" selling to companies who require licences for specific previous versions of Microsoft products, or who might not otherwise have purchased licences due to the cost
Business model
Discount-licensing.com trades in Microsoft Open, Select, Enterprise volume as well as SAP licences. It typically obtains these from the liquidatorLiquidator (law)
In law, a liquidator is the officer appointed when a company goes into winding-up or liquidation who has responsibility for collecting in all of the assets of the company and settling all claims against the company before putting the company into dissolution....
s of companies which have ceased trading or which are downsizing their IT requirements. These are then sold on to customers at a discount to the cost of new licences. This allows customers to purchase licences for non-current as well as current Microsoft versions, which they may have standardised on.
Only Microsoft products with licences that permit transfer (either explicitly or by means of legal loopholes in the licence) are offered. These include Microsoft Office
Microsoft Office
Microsoft Office is a non-free commercial office suite of inter-related desktop applications, servers and services for the Microsoft Windows and Mac OS X operating systems, introduced by Microsoft in August 1, 1989. Initially a marketing term for a bundled set of applications, the first version of...
, Windows Server
Windows Server
Windows Server is a brand name for a group of server operating systems released by Microsoft Corporation. All are part of Microsoft Servers.- Members :This brand includes the following software:* Windows 2000 Server* Windows Server 2003...
licences and Client Access License
Client Access License
A Client Access License is a proprietary software license distributed by software companies such as Microsoft to allow clients to connect to its server software and use the software's services.-Software licensing introduction:...
s, Microsoft Exchange
Microsoft Exchange Server
Microsoft Exchange Server is the server side of a client–server, collaborative application product developed by Microsoft. It is part of the Microsoft Servers line of server products and is used by enterprises using Microsoft infrastructure products...
and Microsoft SQL Server
Microsoft SQL Server
Microsoft SQL Server is a relational database server, developed by Microsoft: It is a software product whose primary function is to store and retrieve data as requested by other software applications, be it those on the same computer or those running on another computer across a network...
but exclude any desktop versions of Windows
Microsoft Windows
Microsoft Windows is a series of operating systems produced by Microsoft.Microsoft introduced an operating environment named Windows on November 20, 1985 as an add-on to MS-DOS in response to the growing interest in graphical user interfaces . Microsoft Windows came to dominate the world's personal...
or any rights under Software Assurance
Microsoft Software Assurance
Microsoft Software Assurance is a Microsoft maintenance program aimed at business users who use Microsoft Windows, Microsoft Office, and other server and desktop applications...
.
The actual licence transfer can sometimes be facilitated directly between the original owner and the new owner, without Discount-licensing.com taking ownership of the licences. Licences are supplied in the form of licence agreement numbers which the recipient can register in Microsoft Volume Licensing Service Center in order to obtain the volume license key
Volume license key
Volume License Key is a term used by many computer software companies to denote the product key used when installing software licensed under volume licensing, which allows a single product key to be used for multiple installations....
s. Following the completion of all paperwork, Microsoft updates it records to reflect the new user, but note that the VLSC does not necessarily show the legal owner. In the case of licences created after October 2007, the sale may sometimes require the creation and transfer of a "shelf company" which owns the licences.
Only whole licence agreements can be transferred so the customer has to choose from the agreements available and may not be able to obtain exactly the combination of licences desired.
The company operates internationally and, following advice from Microsoft that it was permissible, has transferred licences between countries.
Relationship with Microsoft
Microsoft has made it clear that it regards the resale of licences as exploiting an unintended loopholeLoophole
A loophole is a weakness that allows a system to be circumvented.Loophole may also refer to:*Arrowslit, a slit in a castle wall*Loophole , a short science fiction story by Arthur C...
in the provisions for divestiture in its pre-2007 licence agreements. In October 2007 Microsoft introduced a clause prohibiting resale of all types of licences into its EULAs. This was intended to prevent licences sold after this date from being resold, however a further loophole was found to enable licences to continue to be sold, albeit in a more complicated way. Despite this game of cat and mouse
Cat and mouse
Cat and mouse, often expressed as cat-and-mouse game, is an English-language idiom dating back to 1675 that means "a contrived action involving constant pursuit, near captures, and repeated escapes." The "cat" is unable to secure a definitive victory over the "mouse", who despite not being able to...
, Microsoft accepts the legality of Discount-licencing.com's business model and Discount-licencing.com remains a Registered Microsoft Partner and authorised Microsoft Reseller. Discount-licencing.com describes its relationship with Microsoft as "fairly good".