Initial reactions to Oracle’s theft lawsuit against SAP could best be characterised by shock. As one person said: ‘the s**t has hit the fan.’ A few days on and sentiment has swung the other way. Now it is Oracle that is painted as the bad guy:
Did Oracle entrap SAP?
Are there server logs from ISPs verifying the SAP alleged access?
Did Oracle frame SAP?
Why are expired accounts allowed to log in to an Oracle server unless Larry Ellison & Co. was looking to trap SAP?
I raised similar points here and here. Truth is they’re both as bad as each other.
The picture SAP likes to paint is one where it is perceived as behaving in a wholly honourable fashion. That may be true in Europe and I know plenty of SAPpers who act in a decent manner. The same rules don’t apply in the US – especially where Oracle is concerned. Oracle has a long history of employing dirty tricks. Even today, commenters imply that nothing much has changed. If you want to compete with Oracle then you’d best be prepared for a street fight. Or a Rollerball final.
SAP will doubtless portray as ‘rogue’ the actions of those responsible at TomorrowNow. Some heads will roll and then it will be back to business as usual.
Which means a perpetuation of the software industry’s view that 20% year on year maintenance fees is a fair price to pay. That cannot continue. Sadagopan summarises the position well:
Its time to question the logic behind the maintenance revenue stream of product vendors – in every other industry with scale, the maintenance charges or for that matter the service charges shall come down-benefits of scale would reach the customer. Strangely, software industry has no such compulsions. Customers need to have credible alternatives for maintenance and the time to create such options are now
Vinnie thinks the US Federal Government should be brought in. I think there are simpler solutions:
- Customers vote with their feet – TN is doing nicely and has proven that you can deliver third party maintenance at reduced cost and still make a turn. Graham Wylie is buying up as many Sage VARs as it can in an effort to capture maintenance revenue.
- Consider those applications that could be moved to a saas alternative. WIth saas, you pay an all-in-one fee that includes maintenance and technical upgrades. Your costs are fixed and predictable.
When faced with the same situation back in the late 1980s I decided we would move to an unsupported model where we only paid for format changes to meet Companies Act requirements. I remember the arguments way back then – the same as those of today. Software needs investment for development, bugs need fixing etc etc. Those arguments don’t stand up in the cold light of day. Check Oracle’s margin on support. 90%. That’s the industry norm. Rejecting that model saved us a small fortune and the software continued to perform well for years afterwards.
If you must use traditionally licensed software, remember this. You pay for it it twice over under the current prevailing software industry model. Bear that in mind when you next negotiate a license deal. It may be a relatively small figure in the beginning but it adds up over the lifetime of the application.
Technorati Tags: Oracle, third party maintenance, SAP, TomorrowNow
