NAN - Fotolia

Clear Licensing Campaign turns the focus on maintenance contracts

Customers are often paying maintenance without giving it much thought and as a result could be spending too much

The Campaign for Clear Licensing (CCL) is turning the attention on the software maintenance market after having concluded that many customers do not understand what they are paying for.

The organisation has issued figures that show that the software maintenance market is worth $250bn and is worth around 20% of the licence fee every year.

Although there are tools out there to help users keep track of their software assets, the report from the Campaign for Clear Licensing found that only 10% of users were using them to influence their renewal decisions.

“The ideal outcome for this research was to generate a ranking table of which software vendors provided the best and worst support, with whom organizations logged a call with most often, and so on. However, the results were completely unexpected," said Martin Thompson, founder of CCL.

"The typical respondent had no idea of support volumes, support quality or the strategic value of software maintenance renewals at all. In short, software maintenance renewals are not facing enough scrutiny. With the average support and maintenance contract costing the equivalent of 20% of the license fee each year, it is high time that customers held their software vendors to account," he added.

Those in the channel selling software asset management tools have long used the gained savings as the way to tempt customers to make an investment and the same approach could be applied on the maintenance side.

“Software maintenance contracts are being renewed by those with insufficient information to make an informed decision. This is a significant opportunity for those in the ITAM team to take further ownership of this process," he said.

According to the CCL the main beneficiaries of the current situation are the software vendors that are not getting their maintenance contracts closely looked at.

"By bringing greater scrutiny of the software maintenance market, those in ITAM can bring considerable leverage to the negotiation table during renewal discussions. With historically very little scrutiny of this expensive and often unavoidable expense, we will be keeping a close eye on changes in customer and vendor behaviour in this industry over the coming years," added Thompson.

Tomás O’Leary, CEO of Origina, a third party provider of software support and sponsor of the research said that customers were giving money away without looking at the details of contracts.

“Support & maintenance is too often an afterthought in the software buying process; it is one of those areas where software buyers invariably just tick the box because they need it, without ever challenging the vendor on the value being offered or reviewing the alternatives," he said.

Read more on Sales and Customer Management