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Principle 10: Commercial models and offerings shall be consistent and reasonable, not combining different models for the benefit of the vendor’s revenue

Business software vendors and customers should all start with the end in mind; a clear, consistent and well-defined commercial model that’s a win-win for both parties. But practice is different.

Business users associations Beltug, Cigref, CIO Platform Nederland and VOICE call for a balanced cloud market: 11 fair principles to unleash Europe’s digital potential.

22 / 09 / 22

Beltug Fair Principles - Principle 10

 

  • Subscription model or perpetual licence model, not both. If unilaterally the vendor changes the commercial model, the expected cost of ownership changes and business users are not compensated for their earlier investment.
    Customer shall not be forced from a perpetual licence model with maintenance to a subscription model during the same commitment term and without material changes to the solution’s functionality. Mixing both models is detrimental for the customer value. The customer has done the initial investment in the perpetual licences, after which the vendor switches to recurring subscription charges. Because of vendor lock-in, the customer has limited alternatives if the product is only continued under a subscription model: either run the software without maintenance and support or follow the vendor change to subscription model.
  • The way in which software is licensed evolved. There are licences per CPU, user, device, revenue, documents processed in a software, extra security features, …. It became complex to calculate the needed licences within an organisation. On top of that, vendors change their models. E.g. a vendor changed from a machine-based towards a user-based model. With the machine-based licence budgeting was easy, by counting the number of machines. But, as multiple people handle the machines, when a licence per user is now needed, not only the costs changed dramatically, the company also has to organise a follow up of who is using the machines and when. It is clear that the use case needs to be completely re-analysed if such a change is imposed.

The user is asking for a clear cost of ownership, forecasting etc …. That is precisely why this tenth principle is important; commercial models and offerings shall be consistent and reasonable, not combining different models for the benefit of the vendor’s revenue.

  • cloud
  • international
  • security
  • Software

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