"Our Take"

(Past Editions by: Date, Title, Topic)

 
About "Our Take" 
"Our Take" is a collection of daily vignettes covering a wide range of CRM topics. It's an attempt to add our own spin to the world of CRM. We will use the column to share our perspectives, opinions, epiphanies, web nuggets, or quite frankly anything that moves us. Get ready to expect the unexpected. And, don't be shy about sharing your thoughts.
 
 
10/17/06 - Maintenance Fees on the Rise
According to a presentation made by the folks at Gartner, we can expect maintenance fees for software to increase in the next few years. They project current annual rates equal to 18% to 22% of the cost of the software could increase to between 22% and 30% by 2010.
 
Why? The simple answer offered by the analysts is, "Because they can." In fact, they are quite certain this will happen and believe that legislation may be one way to stem the trend. Rising fees are an indication of a lack of competition.
 
I agree that vendors will do it if they can get away with it. But I still believe there is enough competition to keep maintenance fees in line. You can now acquire Software-as-a-Service solutions that offer an alternative to paying maintenance fees. Perhaps there is a lack of competition for the installed base of large installations where switching costs due to integration and customization is quite high. Are you locked in?
 
Gary Lemke, Publisher
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