Sage denies misleading customers over perpetual licensing, users not happy

SME accounting software vendor Sage stands accused of misleading customers following statements detailing when clients will be forced to migrate to subscription-based licensing, enraging the user community.

The vendor set a deadline of the end of September for its migration of Sage 50 Accounts or Sage 50cloud Accounts v26.2 or below to the subscription models, but has since removed the statement from its website. Meanwhile, users have also cast doubt over a statement it offered to The Register in August.

In a statement to The Register today, Sage denied it is misleading customers and said it changed its website notice to improve clarity for its customers.

In July, users and their technology and accounting advisors first contacted Vulture Central alleging that sweeping changes to Sage's software licensing model were forcing them to repay for products they already own – or face losing access to the software vital to their livelihoods.

Sage argued that packages using outdated versions TLS 1.0 and 1.1 of its security protocol to confirm licensing compliance would have to migrate to a subscription licensing model – even if users acquired them under a perpetual license.

Its website warned: "By 30 September 2022, we will switch off TLS 1.0 and 1.1 for our remaining services, Auto Update and Sage License Server, following the latest industry standards."

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In August, users voiced further allegations, claiming they had been mis-sold software under perpetual licenses. They said Sage had given them the impression a perpetual license would give them access to the software for 15 years, but the sudden change meant the vendor would turn it off at less than 10 years' usage.

At the time, a Sage spokesperson told The Register: "Any customer with an active support contract or subscription has access to the latest version without any cost to them."

Users who asked not to be named have said they were told by Sage the only option available to them was to pay for a subscription license or a more recent version, despite already having support contracts. The users eventually secured discounts following repeated calls to sales agents.

The issue is that some resellers had given information to users that a narrower set of versions of Sage were affected, leaving those who contacted Sage directly to believe they had to upgrade when in fact they did not. Meanwhile, other users have noted changes to the Sage advisory page detailing the licensing changes.

The old version of the support site warned: "Once we switch off, anyone using Sage 50 Accounts or Sage 50cloud Accounts v26.2 or below won't be able to access their software."

However, the latest version is less perfunctory: "Some older versions of Sage 50 Accounts use TLS when communicating with the Sage License Server to perform license checks.

"If you're using an impacted version, you'll need to upgrade to a newer version of your software. Don't worry, this guide covers everything you need to do."

One accounting advisor to small businesses said a client affected by the change had been told to wait until the end of September to see if the software is inaccessible. If it was, Sage promised to "sort something out in the background" – but the user did not have the commitment in black and white.

Some customers have decades of transactional data in Sage, which they not only use to run their businesses, but also rely on to file accounts to UK tax collector HMRC.

A Sage spokesperson told The Register: "Customers who have an active support contract with Sage – whether it is perpetual or subscription – are entitled to the latest version of software, at no extra cost. Customers are not required to change their contract to a subscription to upgrade. If they have an active contract, there is no cost to upgrade."

They added: "We have been clear with our customers as to what versions of the software were impacted and what action needs to be taken. We have several support pages available to customers that outline the impacted versions specifically. For instance, we changed our customer information page to make it even clearer for our customers, it is also interactive to avoid customers making assumptions or getting confused. When they start selecting, it presents a series of further questions to help them understand if and how they are impacted." ®