Customer pressure has forced Microsoft to altered its revamped Office XP licensing scheme, giving business users additional time to upgrade their licensing agreements, the company announced yesterday.

When Microsoft launched Office XP in May, it also stated it was to discontinue its former licensing practices by eliminating version upgrades. Users would have until 1 October to upgrade their licensing rights. After that date, they would have to buy new licences for Office XP - at a cost of around £200 per user - if they wanted to have upgrade protection.

With the launch of Office XP, Microsoft set a 31 January 2002 deadline for the upgrade of old licences. This has now been extended until 28 February for corporate customers with current licences for more recent products such as Windows 2000 Professional, Office XP, Windows 2000 server and the .Net enterprise servers.

Others who need to upgrade licences for older versions of Office products have the additional five months to pay for what Microsoft is calling the Upgrade Advantage program. This gives consumers an upgrade to the current licence and extends their Software Assurance program for two years.

The licence upgrade will not be available after the deadline, so corporations are in effect being forced to figure out, by 28 February, if they want to spend money now on protecting licence upgrades or just upgrade to Office XP altogether.

And to further tempt corporate users to just upgrade to Office XP, Microsoft is offering a reduced price for Office XP until 1 October.

Consumers and analysts reacted quickly to the change, accusing the software giant of simply attempting to keep its revenue model afloat with costs that could force corporate customers into paying an additional 30 to 70 percent each year.

Making no reference to the controversy over higher costs, Microsoft said in the statement yesterday that it was offering the licence registration extensions so as to allow companies to include the costs of any upgrades or new purchases into their budgets for the next calendar year.