So you’ve taken the dive into SAP or Oracle instead of simply investing in a few whiteboards and some beer. That’s too bad, but it’s not too late. You could still try the simpler approach. Or stick with SAP… and now realize you have to pay even more on top of the original software, licenses, maintenance fees, and implementation wizards. Yes, SAP wants more out of your wallet.
Two of the biggest makers of business software have raised prices,
a sign that consolidation in the industry may be easing the competition
over prices that has been a hallmark of the last decade. SAP AG
said Wednesday that it has raised prices for the ongoing support and
customer-service fees, known as maintenance, that are part of large
software purchases. The move comes one month after rival Oracle Corp.
raised list prices for its software.
I’m sure there’s a reason, right? Nope. It’s just because they can.
Unlike price increases for food, fuel and many other commodities, the changes in software don’t stem from a shortage of supply or a rise in demand. They are attempts by software makers to increase their bottom lines, said Brendan Barnicle, an analyst at Pacific Crest Securities Inc.
And that increase can hurt other projects. Projects that can directly impact competitiveness.
Owens-Illinois is in the middle of installing SAP’s software, and Mr. Masney said he is compensating for the cost of the project by cutting spending in other areas. Mr. Masney also buys database software from Oracle and said the new price models for both companies could have a "ripple effect" for tech departments.
So what was the cost-benefit analysis on SAP again? And how does that compare with some investment in making the your operations lean and efficient, plus perhaps a couple whiteboards?