PeopleSoft's effort to migrate former JD Edwards customers to a new licence and maintenance pricing model has some users angry, saying they face substantially higher costs.
During a public forum at the Quest Global Conference 2004, users of EnterpriseOne software raised questions around PeopleSoft's attempt to move them from their JD Edwards' licences to a new enterprise licensing scheme.
Users complained that they did not fully understand how the pricing works, their sales representatives appeared not to be empowered to negotiate with them, and would be penalised if they do not migrate to the enterprise model right away.
A lack of clarity about pricing issues from PeopleSoft was perhaps the biggest issue, according to customers at the event.
It has been a frustrating struggle to get information about pricing and the contract fusion programme aimed at moving JD Edwards users to PeopleSoft's pricing methodology, said moderator Fredrick Pond, director of information services at Schnitzer Steel Industries.
His company has a number of lines of business, including self-service auto-wrecking, and runs EnterpriseOne financials.
Schnitzer Steel has been approached about the scheme, which would be based on the size of his organisation, but it has not yet adopted the model.
"At this point, if I did adopt the proposal they have given me, my annual maintenance charges would rise about 25% for the same use of the system I have today," Pond said.
He also said that PeopleSoft annually reviews its customers' financials and will raise the price of its software if revenue grows at more than 10%. The bill never decreases, either, even if a division of the company is sold off or if the market sours.
Different sales representatives had made different approaches for negotiation, some users who remain on the old pricing plan faced a 10% cost increase every quarter, making it cheaper for those who migrate quickly.
A representative of one company at the presentation said that PeopleSoft "was difficult to do business with".
The company is migrating to EnterpriseOne CRM and other software - a process that also means moving to a Unix platform from the AS/400 - and it adopted the new enterprise licence scheme.
Among the difficulties the company faced during the licensing negotiations was a constant turnover in the PeopleSoft sales force - and with each change, information about the licence changed.
The company could not get answers quickly and PeopleSoft sales staff had to constantly go back to headquarters for direction.
The result was a "take it or leave it" negotiation style focused on making quarterly revenue, and not "on long-term relationships. It's very hard for us to figure out where the benefit is to us right now".
Marc L. Songini writes for Computerworld