Saturday, August 28, 2010

Software product's contract set to change

Software product based companies, especially software giants, have been setting high price tag to gaps in their product. Software updates, bug fixes and new funcationality adds come with a yearly price tag for businesses. Gartner is trying to standardise IT maintenance contract by IT maintenance bill of rights.

Some of the key clauses in Gartner recommedation are following
-- a right to "regular, appropriate, predictable updates to software products";
Why can't businesses buying the software demand it from vendors. Being in software industry I can surely say that bug fixes cannot be predictable but they can have cycles of bug fixes planned and delivered to clients for small minimal fee. Bug fixes should be seen as gap in product and provided to clients.

-- response times and support levels "based on application criticality and other business factors";
Support levels surely play important role for a product. Third party support should also be considered by businesses buying the software. A product company may decide not to invest too many resources on support but then they should allow third party to provide good level of services. In recent past Oracle seem to have sued TomorrowNow system and trend may increase. So clients should make sure what is the stand vendor is taking on providing a support. Keeping the support the option open to all makes it competetive and may provide more options to clients buying the software.

-- fair percentage ranges for annual maintenance fee hikes or reductions, and long-term caps on increases;
This should be controlled by monopoly law.

-- the ability to stop or alter support at any time for unused products;
product based companies cannot be forced to continue support for products they want to discontinue. But this should open the door for third party vendors. I am assuming that the product doesn't need bug fixes.

-- predictable and reasonable support levels for the entirety of a product or contract's life cycle;
I agree that this should be spelled out in contracts.

-- clearly spelled-out support time lines for older systems; and
Do we hold the builder responsible for a constrcution that is 10 years older? No. We contract we new people to maintain the building. Same should apply to software.

-- the right to "explicit statement and approval of support details at the line-item level"
I agree that this should be spelled out in contracts.

Software contracts will take centre stage when CIO will try to keep IT expense under control. Predictability of expenses of owning a software will be key in decision making and these recommedations seem to help make it more predictable.

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