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Does that mean, things like AWS Reserved Instances or Savings Plans do not comply with this EU law?
Companies have annual whimsical budget cycles, with new innovation initiatives always big easy targets as not cemented yet. This change makes it very easy to yank one of the 3 year commitments... Which would cause layoffs of a third of the startup.
Earlier quoted context omitted.
>> The issue is you can't use the "I'll give you a deeper discount for a 3 year contract" line anymore. I don't see why not. You can still offer a low price right? You can still promise it won't go up for 3 years. But the customer can now cancel at any time.
Well, if you bought hardware to support that client for 3 years and the client changes their mind 2 months later then you are stuck with this hardware....
Good Riddance. ARR is one of those 'fake' metrics like 'EBITDA' that mean nothing but numbers with make up. a more reflective number is last year revenue + revenue growth rate. and yeah costs / growth of costs.
The specific provisions[1] covering unfair contract terms apply only to "unilateral" contracts, meaning contracts that are offered to a customer who meets two important criteria. First that they attempted to negotiate specific terms in the contract. Second that they had no ability to influence those terms but continued to purchase the service anyways. Real, scaled, committed SaaS ARR isn't going anywhere.
[1] https://eur-lex.europa.eu/eli/reg/2023/2854/oj/eng#cpt_IV
The EU trying to solve a non-existing problem. If a company offers a discount (or not) for a longer minimum term contract and you accept then that's just liberty in action as long as the terms are made clear in advance. There is neither a need nor benefit in regulatory intervention, especially considering all the actual issues on Europe's plate...
>> The EU trying to solve a non-existing problem. It's a problem for me and as an EU citizen I'm happy they're taking the time to solve it.
Second it's ridiculous. No one is killing ARR. That's absolutely not what EU is doing.
> Boom. Subscription gone. Access revoked. Business workflows broken.
> It’s the equivalent of your electricity being cut off because you didn’t click “confirm payment” on a reminder email.
Not what EU is doing again. At all. What a slop.
As a user, this is great news. I think that the artificial lock-in to services that have near zero cost of on-boarding and off-boarding is not what nice companies should do. As an entrepreneur, this is amazing news! This means users can now more easily switch to my superior service. At least this is how I choose to see it. It seems to encourage healthy competition and I'd rather compete on the service quality and val…
Absolutely, companies who remain stagnant will fall behind if they don't offer something as good as or better than competition. Only shareholders who are concerned about "guaranteed income" regardless of its sources will not like this imo.
https://www.coolblue.nl/en/product/963184/microsoft-365-pers...
https://www.coolblue.nl/en/product/952796/adobe-photoshop-el...
Seems to me these trivially violate just about every condition talked about in this article ... yet it's still for sale with no way to cancel and get your money back. Am I missing something?
In fact this store only sells subscription software. That's the only thing available. Non-cancelable, of course. And there's plenty of technical and bundling barriers to switching.