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Companies fret as costs soar for software subscriptions (2019)

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

#241
post #209

Earlier quoted context omitted.

There is also the option of buying self-hosted products and installing them on your own server. The setup time is usually the same, but you only pay $5/mo for the server and maybe $100 one time for the product, instead of paying $100/mo for the service. This is also multiplied by X, where X is the number of subscriptions you have.

No. Please do not suggest this ever. Every company I've worked at and that has gone with self-hosted products have lost more money than paying the subscription. Self-hosted nearly never gets upgraded because there's no budget and it can always be cut from the budget because it'll keep functioning. Corp IT who usually get stuck managing these become the gatekeepers. They have nearly zero incentive to upgrade because t…

The problem is not the self-hosting aspect - it's not taking into consideration the lifecycle.

It's worth self-hosting if you have a good reason for it, and the software is old and boring (aka "battle tested") and packaged by someone else so the lifecycle is someone else's problem.

If it can be installed/maintained/upgraded by running `apt` or `yum`, and isn't a pile of custom hacks then go for it. Server software like Apache/Postgres/MySQL or even fairly nontrivial apps like Jenkins fall into this category. You can literally run these for years, staying updated, with an insignificant amount of maintenance.

Atlassian products with the "download this tarball and run a script" update method aren't as nice as the `apt-get upgrade` you get with the items mentioned above.

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

#243

Earlier quoted context omitted.

Paying some provider to run a standard FLOSS service based on your needs is going to be a hell of a lot cheaper than some bespoke SaaS solution. And Matrix gives you those "rich client features" anyway, with a broad choice of client-side software - so it's a better comparison than IRC.

Indeed, Vector's managed Matrix service is quite a bit cheaper than Slack. but it's also effectively subsidized by Matrix's patreon backers, such as myself. Not necessarily saying this is right or wrong, just that the money always comes from somewhere. Additionally, as a rather dedicated Matrix user and advocate, it's clearly less stable and usable than Slack at present. See e.g. the effort towards a complete rewrite…

> but it's also effectively subsidized by Matrix's patreon backers, such as myself.

I think that's the wrong way of putting it, since that Patreon money is clearly paying for the open component of Matrix. That's work that needs to be done anyway, whether Slack exists or not, and whether businesses choose to host their service instances via Vector or not. And it's definitely a Good Thing that FLOSS suppliers can now get funded via those crowd-based mechanisms - both for aligning incentives and for enhancing the overall "community"/"bazaar" aspect that has helped make a lot of FLOSS software successful in the past.

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

#244

These two sections call out the root of the problem. Both point to a lack of a holistic approach to managing an organization's software licenses. "According to research firm IDC, 60% of U.S. technology spending occurs outside companies’ IT department." ...and... "Many subscriptions, Christopher said, cost $8,000 or so a month—or about $100,000 a year. And it’s not uncommon, he added, for subscriptions costing $10,000…

And why is this a problem? In some cases it's more of a solution.

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

#245

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.

Just an interesting idea, if no one wants to have employees (lets face it, they are a mess, they waste oxygen, they fart, producing CO2, are corona virus friendly, produce road accidents... and you need to pay them so they can live) maybe everyone is having wrong bussiness plan. Whole world should transform to produce only SAAS products for SAAS people as they are the only customers who will in long term still have money to buy SAAS. /s

This is becoming a joke.

In my whole life I didnt buy a one single software product, that is based on subscription model (unless necessary as there are ongoing costs for its development like antiviruses (which I dont use, but this is another story)). Why? As it tells me, the product is at the end of its inovative phase and has nothing more to offer. I am fine with paying for update hunderds of dollars if, and only if, i need the added functionality. Or in different words Microsoft Office 97 was more than enough for 99% of its users (I dare you to install it and find something that you miss, it wasn't perfect but it did get the job done).

But there is more. I wont pay for cloud products either. Why? I believe that what is giving you the "edge" is your knowlidge. Using, for instance, gmail is taking you the chance to increase it. Yeah sure, time to market, but if you stick to DIY logic, this is not going to be a problem (I can set up a mail server with left hand while coding with right hand... and offer it as a SAAS to those that ignore DIY and earn extra bucks ;) /s ). If you ignore the lack of knowlidge, you will end up always paying to someone else or stuck in a problem that wouldn't be a problem if you wouldn't be ignoring it for so long. Not to even go into lack of inovation and reinventing / copying the solutions that were solved long time ago, but this is just another story.

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

#246

"Spend per employee" is not a great metric. Most SaaS services allow companies to hire fewer people as they expand, but this metric does not capture that.

"Most"? I don't know about that. Maybe some do but I'd say most are the same software companies used to buy once every three years or some new thing companies need to do (like live chat). I don't think most saas is keeping down headcount, that's giving it way too much credit.

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

#247
Look, either it's worth it or it's not. Costs may be soaring, but companies wouldn't be buying them if they weren't providing more value than they cost. But:

> enterprise companies are spending an average of more than $10,000 per employee per year on software

Sorry but I can't wrap my head around this. Is that really accurate? Between Office and cloud and HR/payroll and a few other tools I can imagine $1,000/year. And certain employees need SalesForce or Adobe CC or whatever which adds another, say, $500-2,000.

But I just cannot possibly imagine how an average employee is using $10K worth of subscription services?! Does anyone else think this is accurate?

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

#248

Earlier quoted context omitted.

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.

Someone should build a webpage that does this: 1. Enter salary of engineer. 2. Enter cost per engineer of product (subscription, one time, etc.). 3. Enter required minutes to make worth your time (setup per employee can be factored in). This may already exist, but if it doesn't it could be a useful tool for Saas companies. Something you could drop into emails to potential customers ("see how much you would save"). Wo…

So something like this: https://xkcd.com/1205/ ?

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

#249

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.

Read up on the history Chrysler Comprehensive Compensation System (C3). The team worked for 7 years and although they achieved some technical goals they never managed to deliver a working payroll system.

https://en.wikipedia.org/wiki/Chrysler_Comprehensive_Compens...

Payroll is harder than it looks due to all the edge cases. For example, it is literally possible for an employee to have so many payroll deductions including court-ordered wage garnishment that net pay would be negative. How do you handle that in all legal jurisdictions where the company operates?

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

#250

Earlier quoted context omitted.

Yeah, ok, you are assuming SaaS replaces high performance in house applications... That's usually not the case. SaaS usually does not replace in house machines, and it usually does not deal with high performance applications.

Lets see: Github SaaS - source repository, build servers, integration infrastructure. Quickbooks SaaS - replaces DB server, DBA Google Enterprise - replaces Web server, mail server, DNS server, chat server, and NAS devices. Solidworks SaaS - replaces simulation resources with cloud resources. Slack SaaS - chat servers, administration of same. There is an IT concept, SUDs, which is short for "Servers Under Desks." Tha…

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