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Vendor Value Expand / Collapse
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Posted Sunday, May 17, 2009 9:54 PM


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Comments posted to this topic are about the item Vendor Value






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Post #718793
Posted Sunday, May 17, 2009 9:59 PM
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I have no qualms about falling on the side of the argument that maintenance shouldn't be a fee-based element of the business process, but I do think the idea only bad software requires maintenance is faulty. Many systems can be improved by incremental value-adds if well-designed, and a subscription fee model makes sense for that (which is fundamentally different from charging maintenance fees).

My basic point though isn't about fee structures, but that I have to take exception with the notion only bad products require maintenance. The best products deserve cyclic improvement, and maintenance is part of that, of course.
Post #718796
Posted Monday, May 18, 2009 12:11 AM
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I think maintenance is something that is very dependent on the purpose of the application. I wouldn't pay maintenance on basic office software, but am perfectly willing to pay it on the accounting systems I support. The maintenance fees on those systems endure I get swift updates when regulatory changes requrie modifications (the SOX updates were included in maintenance), and we get a new release every three years or so that makes sure we don't get behind the technology curve.
Post #718818
Posted Monday, May 18, 2009 1:29 AM
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My software company rents/leases my software to our clients.
They pay per user per month, indefinitely.
For that they get: all upgrades, and support
It works very well because there is not a huge capital outlay in the beginning,
and they don't end up with licenses that they bought but are not using because of downsizing etc.
Every month we get the latest count of licenses, and that's what we bill.
For us it brings in consistent, regular income, which is great for budgeting.
We certainly feel justified in doing this as the client has more manageable payments,
and all new features we build in (currently every month) they get, so they never feel like they're on the old version.
Plus it means we don't need to support more than, at most, 2 versions at a time :)


if you don't have the time to do it right, when will you have the time to do it over ?
Post #718841
Posted Monday, May 18, 2009 1:57 AM


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If I'm honest, it seems to me to all be semantics. Why should I care whether what I pay for software is called "maintenance" or "rental charge"? Why should I care whether I install updates received in exchange for my "maintenance charge" as opposed to new full versions each bought separately?

In short, I don't care. What a software company chooses to call its charges is irrelevant to me. All it boils down to is that I have to shell out £x as an initial one-off cost plus £y as an ongoing periodic outlay to keep the thing running. If the two costs over the expected lifetime of the system work out to an acceptable price, the vendor gets our business. If not, they get nothing.

What does make me see red, though, is any attempt by the software manufacturer to make their licencing structure deliberately difficult to understand, and here is where I think pressure ought to be applied to vendors. If a software audit takes person-days (or even weeks) to collate, and still needs to be "interpreted", the licencing structure is obstructive and too confusing.

Courts in the UK, when hearing law suits, apply a tests of reasonableness based the opinion of the "man in the street" (personified by the judge). I fail to see why reasonable (tested by similar criteria) clarity could not be required of software vendors in their licencing.


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Post #718856
Posted Monday, May 18, 2009 5:25 AM
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Price leadership from Oracle? I nearly fell off my chair in hysteria. I mean seriously?

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Post #718949
Posted Monday, May 18, 2009 8:22 AM


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Recently I made a large 'final' payment to the last credit card I own. The following month my bill came in and I expected to see a zero balance. Instead there was a small balance, around $50. I called the company and was told; "Sir, that is a payment maintenance fee"... WHAT??? After a few days of hassling with the credit card company I got that "maintenance fee" waived and the card was finally paid off.

Maintenance fees in software, like credit cards, is simply a form of robbery with a nice name. Either the whole concept should just be illegal, or we should pass laws and force vendors to provide honest descriptions in naming such as...

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Post #719112
Posted Monday, May 18, 2009 8:28 AM
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Interesting discussion, though I think the terminology is really in the way. What most agreements resemble most is a car lease, where you make a down payment and pay a regular fee (whether monthly or annually). The problem when applying this model to the software industry, is that you cannot just go to a different leasing company and get the same product.
Regarding Microsoft not following this model, I beg to differ. Enterprise software from Microsoft enatils a maintenance agreement, whether you pay for it separately of include it in the up-front licensing fee. I hate to think what a mess we would all be in if we did not get any maintenance support from Microsoft, whose code seems holier than the Pope. Unfortunately we seem stuck with it forever.
Perhaps there should be a new paradigm, but what it should look like is a very thorny issue, since whole corporate financial models are based on the status quo.
Post #719119
Posted Monday, May 18, 2009 8:34 AM
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blandry (5/18/2009)

Maintenance fees in software, like credit cards, is simply a form of robbery with a nice name. Either the whole concept should just be illegal, or we should pass laws and force vendors to provide honest descriptions in naming such as...

Why should maintenance fees be illegal for software? As a user, you enter into a contract with a vendor with your eyes open. If you don't like the terms, don't buy the software. Or, negotiate different terms. I prefer to pay maintenance every year rather than paying full price for an upgrade when they come out.
Post #719125
Posted Monday, May 18, 2009 8:47 AM
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Just to clarify: we don't charge any upfront software fee (only nominal installation fee)
They pay per user, per month, and that's the only fees that they pay for the software.
Our clients like it because:
1.They are not locked by having spent millions on the software upfront.
2.It is much better for their budgeting, and makes it affordable. It means that everyone from 1 man businesses, to big corporates can afford to use the software. This is a HUGE benefit in a developing economy like South Africa.
3.It is not an exorbitant amount per user per month. if it was, our clients wouldn't use us.
4.They can leave at any point, only having to give us 1 month's notice. This is more fair than them paying a huge amount upfront, and then when they find out the system is not for them, they don't get anything back.


if you don't have the time to do it right, when will you have the time to do it over ?
Post #719135
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