Companies fret as costs soar for software subscriptions (2019) • Hacker News Board

Re: Companies fret as costs soar for software subscriptions (2019)

#41

Post by papito » Thu, Mar 05, 2020, 5:54 PM UTC

taleodor wrote: post #21

paxys wrote: post #8

If you are already spending >$200K per employee, spending another $10K to make them even 10% more productive is a bargain.

Exactly this. Unfortunately, way too often I see execs saying "that's too expensive, we just have to do it manually" instead of using good tool. Then what happens is somebody making $100+/hour would spend several hours to do the job that would be covered by a tool that costs under $50/month.

Because most business in the United States is done despite the management, not because of it.

Re: Companies fret as costs soar for software subscriptions (2019)

#42

Post by bluedino » Thu, Mar 05, 2020, 5:54 PM UTC

jariel wrote: post #29

$10K seems like a lot. If Slack is going to round out at $100/a/staff member ... then how on earth does that number creep to $10K? I think there might be some 'crossing of streams' in this data, for example, perhaps they're including general services like AWS in there, which I'm not sure makes sense because conflating product-related IT charges with other services isn't helpful. Also relevant is the fact that said AW…

>> If Slack is going to round out at $100/a/staff member ... then how on earth does that number creep to $10K?

ERP software like NetSuite usually isn't more than $2,500 a year. Add in an identity provider (Okta), Email/office (O365), Chat (Slack), CRM (Salesforce), Conferencing (Zoom), Storage (DropBox), Payroll (ADP), VPN... Even the enterprise plans for those aren't much more than $50/month.

Re: Companies fret as costs soar for software subscriptions (2019)

#43

Post by phkahler » Thu, Mar 05, 2020, 5:54 PM UTC

JakeWesorick wrote: post #11

Lots of the SaaS products we use mean we don't have to hire more employees. So I'm not sure if dollars per employee is a meaningful stat.

No, total cost would be a better measure since there is no per-person cost to the SaaS provider.

If you have 10,000 employees that's $100M per year in expenses. If you're just renting payroll, purchasing, etc software for that price it'd be far cheaper to roll your own, or pay a few people to work on OSS full time.

Re: Companies fret as costs soar for software subscriptions (2019)

#44

Post by brandly » Thu, Mar 05, 2020, 5:54 PM UTC

wellthisisgreat wrote: post #20

Wildly overpriced subscription-based products that don't have to be subscription-based at all from the functionality standpoint

That's not even a sentence.

Re: Companies fret as costs soar for software subscriptions (2019)

#45

Post by freepor » Thu, Mar 05, 2020, 5:54 PM UTC

runako wrote: post #28

paulie_a wrote: post #13

Earlier quoted context omitted.

Most enterprises don't spend >200k an employee. Do people really believe that is a normal salary?

Obviously the fully-loaded cost of an employee goes beyond the cash compensation. But even so, the average salary in the US is Companies are spending far less than $200k/employee all-in. So to slightly rephrase the OP's question: > Do people really believe that $100k is a normal salary?

Yes but companies that are spending $60K on an employee aren’t spending $10K on their SaaS.

Re: Companies fret as costs soar for software subscriptions (2019)

#46

Post by brianr » Thu, Mar 05, 2020, 5:55 PM UTC

throwaway5752 wrote: post #32

paxys wrote: post #8

If you are already spending >$200K per employee, spending another $10K to make them even 10% more productive is a bargain.

They are just going to pay their employees less. Companies have to be profitable, temporary exceptions notwithstanding, and the money has to come from somewhere.

As long as the purchased software is worthwhile (i.e. it makes employees more effective; the company gets more output per employee expense dollar), this trend should actually increase employee pay. Higher output per employee allows a higher salary per employee while still being profitable.

Re: Companies fret as costs soar for software subscriptions (2019)

#47

Post by munchkinship » Thu, Mar 05, 2020, 5:55 PM UTC

SaaS is a disaster without controls. They make it damn hard to automatically disable users who are no longer active. Then you have users picking competing duplicative tools, and now users can't work together without having duplicate accounts in each tool. Once they get you in, you've got no leverage--they'll just keep increasing prices because you're locked in. Companies are pushing you from perpetual license to cloud not for your benefit.

Re: Companies fret as costs soar for software subscriptions (2019)

#48

Post by _jal » Thu, Mar 05, 2020, 5:55 PM UTC

jariel wrote: post #29

$10K seems like a lot. If Slack is going to round out at $100/a/staff member ... then how on earth does that number creep to $10K? I think there might be some 'crossing of streams' in this data, for example, perhaps they're including general services like AWS in there, which I'm not sure makes sense because conflating product-related IT charges with other services isn't helpful. Also relevant is the fact that said AW…

Slack costs peanuts, comparatively.

If your company has more than around 100 people, there's a good chance your employer uses Netsuite; ask around about what they're paying for that. Salesforce gets pretty spendy, too.

Re: Companies fret as costs soar for software subscriptions (2019)

#49

Post by jcrawfordor » Thu, Mar 05, 2020, 5:55 PM UTC

zcw100 wrote: post #27

Translation: Companies are pissed that the free software gravy-train is over and how they actually have to start paying for it. This is the way it should have been for the past decade.

What free software that enterprises were using has been replaced by SaaS?

Re: Companies fret as costs soar for software subscriptions (2019)

#50

Post by aguyfromnb » Thu, Mar 05, 2020, 5:56 PM UTC

taleodor wrote: post #21

paxys wrote: post #8

If you are already spending >$200K per employee, spending another $10K to make them even 10% more productive is a bargain.

Exactly this. Unfortunately, way too often I see execs saying "that's too expensive, we just have to do it manually" instead of using good tool. Then what happens is somebody making $100+/hour would spend several hours to do the job that would be covered by a tool that costs under $50/month.

>Then what happens is somebody making $100+/hour would spend several hours to do the job that would be covered by a tool that costs under $50/month.

Sure, but then there's the slightly more complicated economic calculus: do we build our own tooling now, for a significant up front cost, or do we buy the SaaS which we might use essentially forever for an unknown future TCO?