The Wall Street Journal ran an interesting article last week entitled “SAP, Oracle Boost Software Prices” The conclusion, as summarized nicely by Forrester’s Ray Wang is that consolidation has resulted in less competition between the big vendors. This in turn can have a significant negative effect on customers …
Less competition means these large consolidators have much more control over your data and can pretty much do whatever they want – for instance as it relates to maintenance pricing. So if I am a buyer and looking at their solutions (largely obtained through acquisitions), should I believe that they are magically going to have the same pricing now that they are part of SAP or Oracle?
What is happening now, of course, is that these software applications are often being given away “for free” through the magic of bundling. And who doesn’t like the concept of free? That is, of course, until you find out next year that the maintenance costs have gone through the roof like gasoline prices. The lesson here? Don’t confuse price with cost. The price of the software may be free today because you are buying into a “stack”, but next year the cost will be whatever those big vendors decide.
Of course cloud computing is a natural counter-balance as we witness a platform shift beyond the control of the traditional enterprise heavyweights. Many organizations are now using a mix of on-premise applications as well as Software-as-a-Service applications. Informatica, as an example, has a mix of both, including more than a dozen SaaS apps.
And while this new mixture of on-premise applications and SaaS applications lets us get the best of both worlds, ultimately the thing that most companies care about is maintaining control of our data. No one wants to become a victim of vendor lock-in. No one wants to be in “Data Jail.”
So how do you take back control?
Our belief is that customers should be able to own and trust their own data, no matter what system or application it resides in. So when the big vendors come along and jack up your costs, you can have the freedom to make a change.
It’s your data, after all!
Have you ever been in data jail? Tell us your stories!
