Friday, September 03, 2010

Our IBM/Lotus Renewals and TCO

I've just finished the IBM/Lotus renewal cycle for the year and either IBM has made some changes for the better or I'm losing my grip on my sanity. Whatever the reason, this year the process actually made sense.

The Cost and the TCO
We're actually quite a small domino shop but our annual renewals would have covered the cost of a 4WD vehicle from a reputable dealer.

This is at least in part due to our office technology mentality. We have our main domino server which is capable of running pretty much everything and we have a second server that we use to run one of our more intensive apps (which I'll talk about in another post).

On top of all this, we have an offsite business continuity server which we've never actually used "for real" - only in test situations. Domino is too stable for it to be a necessity and it's really only there to guard against ISP or "location" failure.

Then we've got a development server and a test server. These are new but welcome additions because having a separate server encourages us to be more daring in our development projects.

The bottom line is simple; if the TCO has blown out, it's our fault for choosing multiple levels of safeguards instead of lower costs.

Upgrade Assurance
Of course, we've also got the option not to renew at all. That's right, we can save all that money by not renewing and still be entitled to use the software in perpetuity. I think that the maintenance entitles us to helpdesk support, which I almost never use because frankly, it's not very good. I find that if I blog about a problem (and if I read everyone else's domino blogs), I get better results than if I complain to IBM. It's a pity really.

So, for us, the maintenance really boils down to nothing more than upgrade assurance. If we pay it, then we're entitled to upgrade. If we stop paying it, then we'd have to buy the software outright again in order to upgrade (that's about three times the cost). If we stayed on the same version of Notes/Domino for three years and then upgraded, we'd probably break even. Four years and the strategy would start to pay off.

Once, there was a time when this was feasible. Once, IBM wasn't putting out many upgrades and in fact those upgrades weren't really worth a whole lot of effort. I guess I'm talking around Notes versions 6 & 7. This has all changed with version 8. IBM now has a good strategy and each upgrade introduces worthwhile features while moving Notes/Domino closer and closer to its true destiny, the web.

IBM are also bundling more and more into the package with Traveller being the most obvious newcomer. It's a great system and I think that it will soon be replacing Blackberry at my workplace. We're also getting a bit of use out of the bundled sametime, though not enough to justify the full package.

I recently learned that there's some sort of entitlement to websphere. Apparently... I've not heard of it before. It's an IBM secret and I've yet to hear it confirmed from an official source.

Sitting on Old Infrastructure
During the negotiations for our upgrade assurance, it always crosses my mind to not bother renewing, though admittedly the lure of new versions keeps me coming back. This year I made a joke about those poor people who are still on Notes 5 & 6. To me, these guys are the laughing stock of the computing world because they're constantly complaining about a product they haven't bothered to update. It's their own fault - not IBMs.

Of course Notes 5 compares unfavourably to the current offerings of the competition. Compare Notes/Domino 8.5.2 with the MS offering of 1999 and you can be sure that IBM/Lotus will come out on top.

I said jokingly that enough water has passed under the bridge that they could pay their maintenance this year and get upgraded without "penalty" and I was told that there was a company out there, on Notes 4.5 who HAVE been paying their maintenance every year but still haven't upgraded.

My jaw dropped.


If all you're really getting for your money is software assurance, why would you pay for it and then not use it? It just doesn't make sense.

Maybe IBM needs to do a survey to find out what versions its "assured" customers are running and then get in there and upgrade them.


Phil said...

You can see the additional entitlements that come with Notes/Domino posted here:

(including WAS)

Nathan T. Freeman said...

Yes there is a limited Websphere entitlement as well as a Tivoli Directory Integrator entitlement. I forget exactly what Websphere piece it is, but it's one of the things intended to leverage the Domino JSP libraries (formerly known as Garnet.) There used to be a limited-use DB2 entitlement, but with the deprecation of NSFDB2, I don't think that will be very useful.

The folks who are on Notes 4 and 5 who still pay for maintenance do so for exactly the opposite of your reasoning: so they can call IBM for support. I agree it's strange, but for them, it's worth it.

At any rate, with that number of servers, I'm surprised it doesn't make more sense to look at Express licensing, unless by "small" you still mean "more than 1000"

Gavin Bollard said...

Thanks for the Info, I'll have a look and see what new toys IBM have for us.

By small, I guess I mean that our actual Notes users are below 50 but our extranet users number just over 4,000.

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