Easier software pricing to combat hosted applications

Software vendors are sweetening their terms

Software suppliers are offering more flexible pricing to protect their market against the new wave of software-as-a-service vendors.

According to a new report by Forrester Research, financing options are “the newest front in the vendor war for a greater share of the IT budget”.

By offering flexible pricing schemes, vendors of traditional on-premises software can attract customers trying to keep down capital expenditure, argues Forrester analyst Ray Wang.

The ability to move costs from capital expenditure to operating expenditure is frequently cited a major advantage of the online software model as it gets rid of the need for investment in servers and upfront software licence costs, by providing hosted hardware and a subscription payment model.

Bundled services, training and extra software are also being offered, Forrester adds.

“Approach these financing options with the same rigour and due diligence as any software negotiation,” the analyst advises.