Software Licensing

Have a sneaking suspicion your company is paying too much for software licensing?  

 

 

If not, you should! Here’s just one example why – For many companies, licensing Agreements can account for up to 50% of their software budget.  Yet, less than 40% of such companies prepare adequately for negotiations and only 10% of businesses that negotiate these confusing agreements on their own achieve a good deal, one that serves their organization well and protects their bottom line.  With proper preparation and through informed, experienced negotiations, your organization can typically save 30-40% on new or renewal software Enterprise Agreements.  Then there are the licenses for the other 50% of the software from other vendors that your company is using and must negotiate!


How do I optimize my company’s software licensing expenditures?  

 

First, you have to apply an open, transparent process that puts your organization’s agenda first and foremost, unencumbered by any interests of the software provider.   This requires vendor-neutral tools and proven processes that enable you to gather, consolidate, review and analyze your IT usage data, accurately and quickly. This process enables your company to identify any gaps between current licensing ownership and usage.  From here, you are able to negotiate new contracts from a position of strength, based on accurate and current information.


Have you evaluated the impact your technical roadmap will have on your software costs?  

 

It’s critical that you do.  If not carefully considered, your IT department can make a decision on a deployment without understanding the full cost implications of software licensing.  A good example is a virtual environment where you may be able to utilize things such as hard partition servers to positively impact your licensing costs.  By understanding your roadmap, financial modeling can be performed and optimal licensing recommendations made, such as avoiding the pre-purchase of unnecessary software licenses.

Is there one basic principle for software licensing negotiations we should adopt?  

 

 

Yes, never pre-buy licenses or bundles! For instance, some software companies love to bundle things for your current and future use, and have you pre-buy them.  Such offers are rarely in your interest.  Examples are their Enterprise Client Access License (E-Cal), Software Assurance (SA), and Microsoft Desktop optimization Program (MDOP).  The best tactic is to carefully map out your purchases, ensuring they link with what you will be using now or in the very near future.  Otherwise, you’ll very likely be paying for things you just won’t need or use.


Do you have a software renewal agreement coming up?  Uncertain how to proceed?
 
OnX can help!  We have a global team of software licensing experts that can help you maneuver the entire licensing negotiation, including up-to-the-minute guidance on best practices when negotiating with software companies.  Our team can provide you everything from a thorough analysis of your baseline compared to your actual deployments and license inventory; to a risk analysis of financial and deployment impacts and optimized licensing roadmap; to leading-edge, vendor-neutral tools and strategies to simplify technologies such as virtualization, VDA and roaming usage.

 

For more than a decade, OnX has been providing advisory services to clients of Oracle, IBM, HP and Microsoft who need assistance in managing the fundamental changes in their software licensing assets.