Admin Alert: Auditing Your IBM i Software Maintenance Bills
December 12, 2012 Timothy Prickett Morgan
Dealing with IBM i third-party maintenance can be a pain. You buy a software package once, but wind up paying yearly maintenance bills for the life of the application, paying 15 percent or more of the original purchase price per year. And the vendor may increase the cost on a yearly basis. This week, I’ll discuss software maintenance fees and give you some tips on keeping your maintenance costs down.
Basic IBM i Maintenance
Third-party software maintenance is a necessary but expensive proposition for IBM i vendors. Software vendors need to charge yearly maintenance to provide cash flow for creating new software versions, providing customer support, and covering other expenses that can’t be financed solely by one-time software sales. Yearly maintenance bills can typically run 15 to 20 percent of the software purchase price, so software maintenance is a big part of any shop’s IBM i budget.
But software maintenance costs can be a moving target that changes each year, and some years you’ll get hit with maintenance increases. Common reasons for maintenance price increases include:
Some vendors are very good about staying with the yearly maintenance cost that you started with. Others can and do take advantage of these situations, slowly raising your maintenance costs over a number of years.
The problem is that yearly maintenance price increases add up. And the software that you started paying 15 percent to 20 percent yearly maintenance for may suddenly start costing you 20 percent to 30 percent or more of your original purchase price. All of which makes it worthwhile to audit your software maintenance bills as they come in.
Information Is The Key
It’s important to have relevant information when dealing with software vendor maintenance contracts, especially if you want to renegotiate a contract for more favorable terms. To that end, I always try to scan and store the following items into separate server folders for each piece of IBM i third-party software running on my systems.
It might take some effort to create a vendor bill folder for each piece of third party software you use. You might have to dig through old bills to get this information or go to your Accounts Payable archives. But once you have historical information on your bills, you also have some ammunition if you need to dispute and hopefully reduce excessive maintenance increases.
When You Want To Renegotiate Maintenance
If you see a yearly software maintenance increase that looks excessive, here are some tips for attempting to keep software maintenance costs in line.
IMHO, fighting for lower rates depends on three things: courtesy and respect for the company you’re dealing with; good information on past maintenance bills for yourself and others; and persistence. I’ve done this for years with various vendors and I’m always surprised how flexible they can be and how I can get unexpected results.
The morale is: if you’re not happy with rising support costs, take your case to the company and ask for a reduction. Just be polite, be prepared, and be persistent. The worst they can do is say “no.” The best they can do is say “yes”. . . and reduce your costs.
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Check out my blog at joehertvik.com, where I focus on computer administration and news (especially IBM i); vendor, marketing, and tech writing news and materials; and whatever else he come across.
Joe Hertvik is the owner of Hertvik Business Services, a service company that provides written marketing content and presentation services for the computer industry, including white papers, case studies, and other marketing material. Email Joe for a free quote for any upcoming projects. He also runs a data center for two companies outside Chicago. Joe is a contributing editor for IT Jungle and has written the Admin Alert column since 2002.