Posts Tagged ‘license management’

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News Analysis: New SAP Customers Face Maintenance Hike

Published on February 4, 2013 by R "Ray" Wang

SAP Plans A Standard Support Maintenance Fees Hike Of 5.5%For New Customers

For new customers, SAP announced its intent to raise its standard support maintenance fee from 18% to 19% effective July 15, 2013.  The standard support option was reintroduced in January 14, 2010, after much pressure from user groups.  A few key takeaways:

  • Price hike follows original plans. SAP has provided a six month advanced announcement to raise maintenance for new customers.  SAP has noted that “the adjustment does not apply to any existing maintenance contracts for SAP Standard Support closed before July 15, 2013″

    Point of View (POV):     The announcement follows the original plan for existing customers to bring Standard Support in line with Enterprise Support by 2015 (see Figure 1).  SAP appears to be harmonizing the price increases for both existing and new customers.  While average support and service contracts are between 18 and 21% in the enterprise software world, SAP’s price increase will still keep it within the norm.
  • SAP raises maintenance rates under the guise of quality. SAP claims that the maintenance fee hike is related to “maintaining the same high level of quality support in the future.  Key features include access to support packages, new releases of standard support solutions, enhancement packages, technology updates, ABAP source code for SAP software applications, and software change management.  SAP also requires customers to use Solution Manager.

    (POV):     SAP’s tried hard to justify the price increase by offering message handling, remote services, SAP Solution Manager Enterprise Edition, and access to SAP Service Marketplace as additional value added benefits.   Unfortunately, most customers find Solution Manager to be a mile wide and an inch deep, the remote services to be minorly useful, and the SAP Service Marketplace to be immature at best.   The result – customers are not getting much value for the price increase. (Fellow Constellation Analyst Frank Scavo provides a list of four questions every new SAP customer should ask.)

Figure 1. SAP Enterprise Support and SAP Standards Support Schedule circa 2010

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The Bottom Line: SAP Wants To Eliminate Standard Support And Competitors to Solution Manager

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Monday’s Musings: Trends In The Top Software Insider Posts of 2012 (#softwareinsider)

Published on January 3, 2013 by R "Ray" Wang

Thank You For Your Support

SoftwareInsider.org generated almost 10 million page views in 2012 (see Figure 1).  This does not include syndication through Constellation Research, Forbes (discontinued in 2012), Enterprise Irregulars, Computerworld UK, and other great media partners.

Figure 1.  Software Insider Achieved 9.8M Page Views for 2012

Classic Posts Address The Key Fundamentals In The Disruptive Technology Shift

Four posts have made the all time favorite list and address the 5 consumer technology forces that influence enterprise software.

  1. Monday’s Musings: How The Five Consumer Tech Macro Pillars Influence Enterprise Software Innovation
  2. Research Report: The 18 Use Cases of Social CRM and The New Rules of Relationship Management
  3. Tuesday’s Tip: Understanding the Many Flavors of Cloud Computing
  4. Best Practices: Five Simple Rules for Social Business

2012 Top 40 Reflects A Broader Shift To Business Outcomes And Technology Adoption

Analyst Relations and the World of Influence - The top blog post of 2013 discussed the future of the industry analyst versus legacy analyst firms.

Consumerization of Technology and The New C-Suite – The impact of technology on the C-suite has never been greater.  As business strategy relies more on technology, CMOs, CFOs, and other line of business heads can expect to work more closely with the CIOs and CTOs.

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News Analysis: UsedSoft Vs Oracle Ruling Opens Up Monopolistic Practices By Software Vendors

Published on July 4, 2012 by R "Ray" Wang

Used Software Pioneers Gain A Small Victory In A Shrinking On-Premises Software World

The surprise July 3rd, 2012 judgment by the Court of Justice of the European Union for UsedSoft GmbH v Oracle International Corp rules that “An author of software cannot oppose the resale of his ‘used’ licenses allowing the use of his programs downloaded from the internet”.

“The Court of Justice interprets EU law to make sure it is applied in the same way in all EU countries. It also settles legal disputes between EU governments and EU institutions. Individuals, companies or organisations can also bring cases before the Court if they feel their rights have been infringed by an EU institution.”

The recent ruling on the rights of used software mirrors other rulings in cases such as SusenSoftware v SAP and UsedSoft v Microsoft.  Analysis of the ruling shows that:

  • Exhaustion Rule is now the rule of the land. While the German Federal Court of Justice (BGH) on July 6th, 2000 upheld this legal foundation, many vendors have continued to challenge the case.  In this instance the BGH sent the case to the Court of Justice to interpret the UsedSoft v Oracle International Corp case.  The court deliberated and finally ruled that “The exclusive right of distribution of a copy of a computer program covered by such a license is exhausted on its first sale”.

    Point of View (POV):     UsedSoft’s primary business model is to market licenses acquired from Oracle customers.  After acquiring rights to the license, UsedSoft’s customers who do not possess the software download the licenses directly from Oracle’s website.  Applied to the “Exhaustion Rule”, this means that the developer’s copyright exclusive right of distribution expires at the time of sale.  In summary, a developer can only make money on the initial sale and any attempt to restrict trade of used software through specific trade terms conflicts with the exhaustion rule.
  • Exhaustion Rule applies to physical and downloaded software. This applies to any on-premises software purchase in person and on-line anywhere in the territory of a Member state of the EU.  The ruling states that “the principle of exhaustion of the distirbution right applies not only where the copyright holder markets copies of his software on a material medium (CD-ROM or DVD), but also where he distributes them by means of downloads from his website.”

    Point of View (POV):     Oracle’s main argument in the case that the directive does not apply to licenses downloaded from the internet is struck down.  As the highest court in the EU, this ruling is the final ruling.  Downloaded or bought in physical form, exhaustion rule applies to all software including both enterprise, personal, and games.  New acquirer of the licenses can download it directly from the vendor’s site.
  • Software publishers can no longer oppose the resale of the copy of software. The court clarified two points on resales of copies of software.  The first, “Where the copyright holder makes available to his customer a copy- tangible or intangible – and at the same time concludes, in return form payment of a fee, a license agreement granting the customer the right to use that copy for an unlimited period, that right holder sells the copy to the customer and thus exhausts his exclusive distribution right.” The second, “Such a transaction involves a transfer of the right of ownership of the copy. Therefore, even if the license agreement prohibits a further transfer, the right holder can no longer oppose the resale of that copy”

    Point of View (POV):     The clarifications on the resale of the copy of software have huge ramifications.  Based on the ruling, “the distribution right extends to the copy of the computer program sold as corrected and updated by the copyright holder”.  Users basically have rights to all updates at the time of the sale and this latest version can be sold to the secondary market.  Users who fail to download updates have rights to resell those alterations to the next customer.  The subsequent customer would not have such rights.

  • Software licenses can not be divided in the resale and be reused. The ruling clarifies ownership provisions upon reselling.  “If the license acquired by the first acquirer relates to a greater number of users than he needs, that acquires is not authorised by the effect of the exhaustion of the distribution right to divide the license and resell only part of it”.  “An original acquirer of a tangible or intangible copy of a computer program for which the copyright holder’s right of distribution is exhausted must make the copy downloaded onto his own computer at the time of resale”

    Point of View (POV):     The court wisely upholds copyright law by requiring the seller to remove the property from their possession prior to resell.  However, the inability to divide licenses means that users will have to be careful about the number of licenses they purchase upfront or purchase with separate contracts to allow for the resell of licenses in the future.

The Bottom Line For Buyers: In the EU You Own Your Software Free And Clear of Vendor Encumbrances

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News Analysis: Spinnaker Expands JD Edwards Support With Versytec Acquisition

Published on March 25, 2012 by R "Ray" Wang

Versytec Acquisition Addresses Growing Demand For JD Edwards Support


Denver, Colorado based Spinnaker Management announced on March 6th, 2012 its acquisition of competitor Versytec.  For those who remember their third party maintenance (3PM) history, Versytec was among the first firms to announce third-party maintenance services within a year after PeopleSoft acquired JD Edwards in July 18, 2003.  Constellation estimates that Nashua, New Hampshire based Versytec had between 35 to 40 active 3PM customers.

Third-party maintenance describes support and maintenance offerings delivered by non-OEM providers. These vendors can provide a range of options from basic break/fix to bug fixes, performance optimization, tax and regulatory updates, and customization support. Keep in mind, 3PM does not provide access to upgrades and future versions of the OEM’s product. One big driver is the lower cost of delivery, as much as half the cost of the original vendor’s pricing.  Today most customers pay in maintenance and support the equivalent of a new license every 5 years without achieving the value.  For an average JD Edwards customer that upgrades every 15 years, that’s three times the cost of the original license cost.  In the latest Constellation research report, third party maintenance is one of many strategies to free up millions for customers to fund innovation.

The Spinnaker-Versytec deal is important for a few reasons:

  • Many JD Edwards customers seek alternatives to Oracle’s pricey maintenance fees. Software ownership costs continue to escalate as vendors accelerate their efforts to capture support and maintenance revenues.  From inquiries, surveys, and conversations on the ground, many Oracle JD Edwards World and EnterpriseOne ERP customers seek options to buy-time as they consider whether they upgrade or migrate from their current version.  Why?  Most JD Edwards customers run stable environments and do not gain any value from the Oracle one-size fits all 22% support policy.  Most customers seek phone support and tax and regulatory updates.
  • The market needs more options and choices in the third party maintenance market. Many OEM vendors have gone to the extreme to eliminate third-party options for their customers.  This anti-competitive behavior takes away choice for the customer. A bulked up Spinnaker creates a viable organization that has the critical mass to compete with Oracle.   The combined entity provides third party support services to an estimated 100 160 JD Edwards customers across the globe.
  • Spinnaker Support offers a different approach to third party maintenance. Spinnaker couples its third party maintenance options with consulting services providing a one-stop shop for JD Edwards customers.  Spinnaker also differentiates in its download methodology of customer entitled IP from Oracle.  Spinnaker provides customers with a checklist of what to download prior to migration off Oracle support.

The Bottom Line: Users Must Advocate for Third-Party Maintenance Rights Across the Technology Stack

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Research Summary: Best Practices – Three Simple Software Maintenance Strategies That Can Save You Millions

Published on March 18, 2012 by R "Ray" Wang

Forward And Commentary

Software ownership costs continue to escalate as vendors accelerate their efforts to capture support and maintenance revenues. Some vendors have gone to the extreme to eliminate third-party options for their customers. This best practices report examines three strategies to free up unnecessary costs to fund innovation and new projects.

A. Introduction

On average, IT budgets are down from 1-5 percent year-over-year, yet software support and maintenance costs continue to escalate ahead of inflation. Hence, continued pressure on IT budgets and a growing need for innovation projects have top business and technology leaders reexamining their software support and maintenance contracts for cost efficiencies.

Based on experience from over 1500 software contract negotiations, Constellation suggests three approaches to reduce the cost of software support and maintenance. Key strategies include third-party maintenance, shelfware reductions and unbundling maintenance contracts as part of every organization’s tech optimization strategy. Successful implementation can lead to savings from 10-25 percent of the IT budget, freeing up cash to fund innovation initiatives.

B. Research Findings – Why Every Organization Should Consider Third-Party Maintenance, Shelfware Reductions and Unbundling Maintenance Contracts

Most organizations suffocate from the high and hidden cost of support and maintenance. On average, Constellation’s surveys reveal global IT budgets trending down from 1-5 percent year-over-year since 2008. Consumerization of IT, rapidly changing business models, and aging infrastructure have exposed the high cost of software support and maintenance. Because most organizations allocate from 60-85 percent of their budget to keeping the lights on, very little of the budget is left to spend on new projects (see Figure 1).

Organizations can unlock millions by considering third-party maintenance (3PM), reducing shelfware, and keeping support and maintenance contracts unbundled. Each strategy on its own creates opportunities to drive cost savings. All three strategies combined, provide a roadmap for funding innovation.

  1. Third-party maintenance (3PM) delivers the most immediate cost savings and opportunity for innovation. Third-party maintenance describes support and maintenance offerings delivered by non-OEM providers. These vendors can provide a range of options from basic break/fix to bug fixes, performance optimization, tax and regulatory updates, and customization support. Keep in mind, 3PM does not provide access to upgrades and future versions of the OEM’s product. One big driver is the lower cost of delivery, as much as half the cost of the original vendor’s pricing.  The report shows a survey of 268 respondents and why organizations choose 3PM and who the key vendors are.
  2. Reduction of shelfware remains a key pillar in legacy optimization strategies.  Shelfware (i.e. purchased software, not deployed, but incurring annual maintenance fees) is one of the biggest drains on operational expenses for enterprises. The simple definition of shelfware is software you buy and don’t use. For example, an organization that buys 1000 licenses of Vendor X’s latest ERP software and uses 905 licenses, becomes the proud owner of 95 licenses not being utilized. That’s 95 licenses of shelfware because the user will pay support and maintenance on the license whether or not they use the software or not.  The report details 4 successful and proven approaches.
  3. Unbundling maintenance contracts prevents future vendor mischief. About a decade back, vendors would offer support and maintenance as two separate line items on their contracts. Support would run about 5-10 percent of the license fee and so would maintenance. Keep in mind, average support and maintenance fees were under 15 percent back then. Unfortunately, many users have expressed a growing and concerning trend with support and maintenance contracts. Vendors concerns about support and maintenance contract retentions have led to new initiatives to consolidate contracts. At first glance, this may appear to be proactive and beneficial to customers, but the report details three rationales vendors provide and three strategies how to avoid bundling.

Figure 1. Visualizing the High Costs of Support And Maintenance

(Right-click to see full image)

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Monday’s Musings: Lessons Learned From Amazon’s Cloud Outage

Published on April 25, 2011 by R "Ray" Wang

Amazon’s Cloud Outage Catches Most Clients Offguard

The recent Amazon cloud outage at its Northern Virgina data center from 5 am Thursday, April 21, 2011 to roughly 5 am Friday, April 22 has shaken the confidence of some executives on public cloud computing.  Most notably, FourSquare, HootSuite, Reddit, and Quora publicly suffered visible performance issues.  The industry’s reassurances in the past on up time performance and massive redundancy capabilities combined with the massive corporate adoption had everyone believing that public clouds were bullet proof.  As calmer heads prevail, most CIOs, business leaders, and analysts realize that:

  • Cloud outages are rare but can happen. While most organizations can not deliver 99.5% up time let alone 90% performance, disruptions can and will happen.  The massive impact to so many organizations last week highlights potential vulnerabilities of betting 100% of capacity in the cloud.  More importantly, it showed that broad adoption does not equate with bullet-proof reliability.  Most organizations lacked a contingency plan.
  • Cost benefit ratios still favor cloud deployments. For most organizations, the cost of deploying in the cloud remains a factor of 10 cheaper than moving back to the traditional data center or even a private cloud.  Capital costs for equipment, labor for managing the data center, excess software capacity, and the deployment time required to stand up a server create significant cost advantages for cloud deployments.
  • Current service level agreements lack teeth and should be improved. Most organizations lack teeth in the cloud/saas contracts to address service level agreement failure.  Despite all backups and contingency plans, clients should consider scenarios where core business systems go down. What remedies are appropriate? What contingencies for system back up are in place.   Who is responsible for disaster recovery? Will the vendor provide  liability and for what?

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Tuesday’s Tip: Dealing With Pesky Software Licensing Audits

Published on April 19, 2011 by R "Ray" Wang

Organizations Report Increase In Software Licensing Audits

Across the board, the largest complaints about software vendors and their business practices have come from increasingly aggressive software auditing practices.  Once thought to be a small possibility, the software vendors now wield this big stick to drive up sales and of course ensure compliance.  Given the 32 percentage gain since Q1 2008 in the percentage of respondents faced with a software audits, procurement managers, CIOs, and CEOs have paid attention (see Figure 1).   Even the recent Gartner report from star analyst Jane Disbrow et al. shows that 61% of their customers have been audited by at least one software vendor.

Figure 1.  Software Vendors Ramp Up Software Audits

Software Licensing Audits Masquerade As Sales Tactics In Disguise

Is this shocking?  Should customers be concerned?    Given the relatively strong compliance rates in the high 80′s, customers should be livid that vendors are willing to jeopardize a relationship to shake down for cash (see Figure 2.).  Here are some key reasons for the audit:

  • Check for compliance
  • Identify installed base competitors
  • Drive incremental license sales
  • Prospect for up-sell/cross-sell

After speaking with 13 major software vendors, most admitted that software audit served two purposes.  The first – keep customers in compliance.  The second – shaking the bushes for new deals during the recession.

Figure 2.  Most Organizations Were In Compliance Post Software Audit

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Research Report: Constellation’s Research Outlook For 2011

Published on January 4, 2011 by R "Ray" Wang

Organizations Seek Measurable Results In Disruptive Tech, Next Gen Business, And Legacy Optimization Projects For 2011

Credits: Hugh MacLeod

Enterprise leaders seek pragmatic, creative, and disruptive solutions that achieve both profitability and market differentiation.  Cutting through the hype and buzz of the latest consumer tech innovations and disruptive technologies, Constellation Research expects business value to reemerge as the common operating principle that resonates among leading marketing, technology, operations, human resource, and finance executives.  As a result, Constellation expects organizations to face three main challenges: (see Figure 1.):

  • Navigating disruptive technologies. Innovative leaders must quickly assess which disruptive technologies show promise for their organizations.  The link back to business strategy will drive what to adopt, when to adopt, why to adopt, and how to adopt.  Expect leading organizations to reinvest in research budgets and internal processes that inform, disseminate, and prepare their organizations for an increasing pace in technology adoption.
  • Designing next generation business models. Disruptive technologies on their own will not provide the market leading advantages required for success. Leaders must identify where these technologies can create differentiation through new business models, grow new profit pools via new experiences, and deliver market efficiencies that save money and time.  Organizations will also have to learn how to fail fast, and move on to the next set of emerging ideas.
  • Funding innovation through legacy optimization. Leaders can expect budgets to remain from flat to incremental growth in 2011. As a result, much of the disruptive technology and next generation business models must be funded through optimizing existing investments. Leaders not only must reduce the cost of existing investments, but also, leverage existing infrastructure to achieve the greatest amount of business value.

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Research Summary: Software Insider’s Top 25 Posts For 2010

Published on January 2, 2011 by R "Ray" Wang

Themes In 2010 Reflected The Buy Side Demand For Both Optimization and Innovation

Technology buyers in 2010 focused most of their priorities on finding cost savings through legacy optimization, navigating a flurry of disruptive technologies, and designing/experimenting with new business model innovations.  Consequently, the top 25 posts for 2010 reflected these 3 major themes:

Legacy Optimization

Disruptive Technology

Business Innovation

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Monday’s Musings: Why Users Must Preserve Their Third Party Maintenance Rights

Published on February 22, 2010 by R "Ray" Wang

Apps Users Seek Third Party Maintenance For Cost, Value, and Service

Updated surveys from inquiries, client conversations, and user group meetings show a 113.8% increase in interest in third party maintenance (3PM) services from Q3 2009 to Q1 2010 (see Figure 1).  Key factors stem from (see Figure 2.):

  • Continuing cost pressures. Budgets continue to be at flat or have been reduced.  Organizations must do more with less.  Add pressures to innovate, CIO’s must find fat without trimming bone.
  • Gaining minimal value in maintenance services. Most felt they were paying too much for too little.  An 8 point jump reemphasized the issue with a lack of tiered offerings.
  • Declining plans to upgrade. Worsening economic conditions from Q3 2009 to Q1 2010 led a 27 point increase in interest in 3PM.  Expect many respondents to change their point of view (POV) as economic conditions improve.
  • Expecting better service. Service continues to play a key factor in decisions to go to 3PM.  Over 60% of respondents had experienced poor levels of service.
  • Slowing pace of vendor innovation. Greater than half of respondents believe their vendor has been too slow to deliver new capabilities. These include SaaS deployment options or key functionality in areas such as strategic HCM and social CRM.
  • Disliking the vendor. About 1/3 of the survey respondents have bad experiences with their vendor.  Many times it comes from sales person or support rep experiences.
  • Delivering self support. Almost 30% of respondents already provide their own support.  These organizations have no need to pay maintenance when they are doing all the work.

Figure 1. Interest in 3PM grows 113.8% over 2 quarters.

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Figure 2. Cost Pressures, Value, And Decision Not To Upgrade Drive Current Trends to 3PM

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Limited Options Exist For Most Enterprise Apps Customers

Of the 101 respondents in Q1 2010 interested in 3PM, Oracle (88.1%) and SAP (76.2%) users expressed the greatest interest in seeking independent services (see Figure 3).  Over 80% of the users were from large companies greater than 1000 employees across the globe.  Most SAP users surveyed have mixed environments with Siebel, JD Edwards, and PeopleSoft joint installations.  Unfortunately, very few public options exist for sole SAP users (see Figure 4).  For example, SAP customers can only turn to Rimini Street.  Oracle customers on PeopleSoft, JD Edwards, and Siebel also have limited choices with Rimini Street, netCustomer, and Spinnaker among the options.  IBM, Infor, Lawson, Computer Associates, Epicor, Microsoft Dynamics, Oracle E-Business Suite and database customers have no options.  (Note: This data may not be completely statistically significant given the sample size of 240, but hopefully it provides some directional input.)

Figure 3. Oracle And SAP Users Drive Interest In 3PM

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Figure 4. Very Few Public Options Exist For Customers

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The Bottom Line For Users – Users And User Groups Must Band Together To Guarantee 3PM Rights. Don’t Take These For Granted!

Although the latest surveys show a 17 point increase in the belief that 3PM is a right, this right is under fire by big vendors such as Oracle who have taken legal actions against 3PM providers for improperly (i.e. TomorrowNow) and allegedly (i.e. Rimini Street) violating intellectual property rights.  If providers have violated such laws, Oracle rightfully should defend its positions and those providers be punished.  However, there’s a lot of money at stake.  For most vendors, maintenance represents 50% to 80% of their revenue stream.  Consequently, users and user groups have a responsibility to:

  • Demand that their contracts include provisions that protect their right to 3PM
  • Require vendors to work out rules on how 3PM providers can deliver services without violating software IP provisions
  • Seek anti-trust class action with the US DOJ (i.e. Christine A. Varney) and the EU Compeition (i.e. Joaquín Almunia) against software vendors who hinder 3PM providers from providing services

Users and user groups must vigorously defend their positions in contracts and legal action or lose this right.  Failure will result in a continued software maintenance monopoly.  Success will ensure market competition and renewed innovation.  Attention: OAUG, Quest, and SUGEN leadership your members need your help!

Figure 5.  A Growing Body Of Users Believe 3PM Is A Right

screen-shot-2010-02-20-at-44509-pm

The Bottom Line For Vendors – Proactively Address The Issue Or Expect A Groundswell Of Activism

SaaS, subscription pricing, 3PM, and the economy provide a confluence of forces that will continue to attack maintenance revenue streams.  Many legal cases have been fought over this issue including IBM vs Amdahl and Geac vs Grace Consulting.  SAP’s failed attempt to convince customers on the value of Enterprise Support led to a public relations disaster and a factor in the resignation of their CEO.  The result – many vendors considering price hikes held back.  In fact, some savvy software vendors retooled and restored the client -vendor relationship by:

  • Offering more entry points and tiers to support options. The three pillars of software maintenance and support policies still apply.  However, several vendors are now offering more tiers of support as lower entry points.  Two vendors have finalized plans to offer just the bare bones legal and regulatory updates.  Other vendors have made it easier to come back with maintenance amnesty plans.
  • Providing flexible maintenance policies. Vendors who change rigid policies have experienced success among customers.  Some Both Infor through Infor Flex and Micrsoft Dynamics allow like for like swap credits to migrate between existing products.
  • Renegotiating existing terms. Some vendors are helping clients meet the realities of the current market conditions. Big on the list is helping clients address shelf ware without repricing of contracts.  For clients who paid full maintenance on software that’s at least 4 years old, some vendors are offering to reduce up to 20% of the overall licenses not in use.  This leads to lower maintenance revenue but engenders good will among key clients.  Further, several vendors have allowed clients to apply credit towards another module as an alternative.
  • Delivering amnesty programs. Several vendors have allowed customers to return to maintenance programs after years of not paying.  Such programs play a key role in helping customers upgrade but should be used sparingly as customers may become accustomed to this practice.
  • Creating better peer forums to share information. Almost every vendor surveyed has a program to improve the online support capabilities.  Applying Social CRM use cases,  user generated content in peer forums tops the list of initiatives.  Other plans focus on sharing data on benchmarks, operational metrics, and best practices.
  • Assisting with vendor financing. Clients seek access to financing, especially many in the mid-market who’s credit lines have been zapped.  Microsoft has led the charge by providing 0% financing for its Microsoft Dynamics ERP and Microsoft Dynamics CRM Customers.  Other vendors such as IBM, Infor, Oracle, SAP, Sage also offer vendor led financing programs that include hardware, implementation, training, and other services.
  • Lowering cost of usage and ownership. Though tops on the list as a conceptual practice, most vendors will need to roll out such initiatives over the next 24 months.  A few notable exceptions include Agresso with its VITA architecture which allows customers to rapidly make business and UI changes, Microsoft Dynamics customers who report back significantly lowered implementation and training costs compared to most vendors, and Epicor customers who report significant productivity gains with Service Connect.  SaaS customers already experience such gains.

Your POV

Take the new and improved survey on 3rd party maintenance and let us know if you need help with your enterprise apps strategy by:

  • Conducting an ROI on 3rd party maintenance options
  • Identifying cost reduction opportunities
  • Renegotiating your software contracts
  • Improving innovation via SaaS and other deployment options

Please post or send on to rwang0 at gmail dot com or r at softwaresinsider dot org and we’ll keep your anonymity.

Related resources and links

20091008 Deal Architect – Vinnie Mirchandani “Third Party Maintenance Is Really 4 Decades Old”

20071120 News Analysis: Too Early to Call the Death of Third Party Maintenance

20090210 Tuesday’s Tip: Software Licensing and Pricing – Do Not Give Away Your Third Party Maintenance And Access Rights

20090709 Tuesday’s Tip: Do Not Bundle Your Support and Maintenance Contracts!

20090622 News Analysis: Infor Flex Reflects Proactive Maintenance Policy

20090516 News Analysis: Rimini Street Launches Third Party Maintenance for SAP

20090504 News Analysis: Oracle Waives Fees On Extended Support Offerings

20080909 Trends: What Customers Want From Maintenance And Support

20080215 Software Licensing and Pricing: Stop the Anti-Competitive Maintenance Fee Madness

20090428 News Analysis: SAP and SUGEN Make Progress on Enterprise Support

20090405 Monday’s Musings: Total Account Value, True Cost of Ownership, And Software Vendor Business Models

20090330 Monday’s Musings: It’s The Relationship, Stupid! (Part 2) – Stop Slashing The Quality Of Support And Maintenance

20090324 Tuesday’s Tips: Five Simple Steps To Reduce Your Software Maintenance Costs

20090223 Monday’s Musings: Five Programs Some Vendors Have Implemented To Help Clients In An Economic Recession

20081012 Monday’s Musings: 5 Steps to Restoring Trust in the Vendor – Customer Relationship

20100114 News Analysis: SAP Revives Two Tier Maintenance Options

20091012 Research Report: Customer Bill of Rights – Software-as-a Service

20090912 News Analysis: Siemens Cancels SAP Maintenance Contract

20090910 Tuesday’s Tip: Note To Self – Start Renegotiating Your Q4 Software Maintenance Contracts Now!

20090602 Tuesday’s Tip: Now’s The Time To Consider SaaS Software Escrows

Copyright © 2010 R Wang and Insider Associates, LLC. All rights reserved.

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