Although customers won't be able to purchase Microsoft's small/mid-size business (SMB) version of Windows Server until this fall, Redmond's tinkering now with the product pricing and licensing to attract users who might otherwise be lured by Linux.

This week, Microsoft went public with plans to price the low-end version of its forthcoming Windows Small Business Server (SBS) 2003 product at $599. That price includes five client-access licenses (CALs). The higher-end version will stay at the same price as the current SBS 2000 product, $1,499 (with five CALs included). Additional CALs will cost more, however: $99 each, as opposed to $60 currently.

At the same time, Microsoft officials also said that they will allow Small Business Server 2003 customers to run 75 Windows clients — rather than the current limit of 50 — off a single SBS system.

Microsoft plans to make SBS 2003 generally available in early October. The company will launch the product officially at its Momentum partner conference in New Orleans the week of October 9.

Earlier this summer, Microsoft announced that it planned to offer two versions, Standard and Premium, of SBS 2003. (Currently, there is only one version of SBS 2000.)

The premium release includes Windows Server 2003, Exchange Server 2003, Windows SharePoint Services, SQL Server 2000, Microsoft Internet Security and Acceleration Server (ISA) 2000 and a copy of FrontPage. The standard version does not include SQL Server, ISA Server or FrontPage.

With the new, low pricing for standard, "our idea is target that small, small business and help them get started," says Katy Hunter, Microsoft group product manager. Hunter notes that the smaller end of the SMB market is the fastest growing part of that business at the moment.

The goal of raising the limit of clients per SBS 2003 server is to give small businesses more headroom to grow, Hunter adds. SBS 2000 and 2003 are both targeted at shops with 50 or fewer PCs, she notes. And even though Microsoft found very few small-business customers with more than 39 PCs running off a single server, the company decided to move the limit up to 75 "in order to ease that migration."

"The 75-user limit is very important to our company," says Hale Barter, a network administrator with Errol L. Montgomery & Associates. "We were considering purchasing SBS but were anxious we might approach the 50 user limit within three years. Now we will definitely choose SBS."

When asked whether Microsoft's moves are an offense against Linux in the SMB space, Hunter says, "we're always keeping our eye on Linux."

"We think users out there want value," and that's what SBS 2003 is designed to provide," Hunter says. "With Linux, customers are not looking so much for value as for cheap or free."