Monopoly of a few enterprise IT application vendors is set to change because given a choice some of the prominent chief information officers, who take the call pertaining to investments and decisions around IT in their enterprises, are ready to switch vendors and also look at other alternatives such as cloud, in order to optimise cost.
A large section of such CIOs, from about 100 of them, are not happy with the recent hike in maintenance fee announced by ERP major SAP, as per a ‘Survey On Licence Fee and Current Dynamics’ conducted by CIOL during the C-Change 2013.
About 43 per cent of CIOs have said that the recent hike in maintenance fees, by up to 5-22 per cent, announced by SAP was totally uncalled for and unreasonable, though 16 per cent of them were expecting such a hike.
Licences for enterprise suites are an important parameter for decision making, so most of them feel that the vendor should bring some modifications in the licence fee. On the other hand, there were also a few who felt the hike is useful as skills and software enhancements come along with such changes and moreover, it is useful for R&D enhancement as well.
However, a small percentage of the respondents have remarked that the move will see the similar drawback pressure from customers like what happened during the previous hike.
Due to the increase in the licence fee, about 60 per cent of CIOs said that they are either moving to cloud or third party vendors, whereas, atleast 30 per cent of them will be looking at in-house support over such alternatives.
More than half of the CIOs agree that enhancement packs do serve a purpose and that software upgrades are useful, whereas, about 23 per cent have pointed that such enhancements do not serve any purpose at all. Meanwhile, about 13 per cent said they are not sure whether such enhancements or upgrade are useful.
Having said that, a majority (77 per cent) of the CIOs, who took the survey, agreed that there is a rationale behind a vendor’s licence audit, however, about 13 per cent disagreed. Most of them said that in case a gap or or aberration is found it needs to be addressed through either discussion or by resorting to use-based extra payments.