4
According to Gartner, businesses spend 90%
of their IT budgets keeping the lights on,
leaving only 10% for digital transformation.
If the customer chooses not to purchase
new software or doesn’t want to leap into a
new licensing model, stand-alone support
renewal costs can come with steep increases
– provided the vendor selling the software
makes support options available, which is not
always the case.
In the short term, agreeing to an unnecessary
software bundle or surrendering perpetual
licenses might look like the best choice,
compared to vastly overpaying for the same
support levels or losing access to support
altogether. But this same combination of
factors can sideline long-term technology
plans by forcing companies to pile on
purchases, recurring payments, and version
upgrades they don’t need just to keep using
the software they rely on.
In other circumstances, large vendors like
VMware have simply stopped offering
support renewals for perpetually licensed,
on-premises software, telling customers they
must surrender their perpetual licenses for
subscription-based alternatives if they wish to
keep the products supported.
4
The software support renewal trap
(and how to avoid it)
2 “IT Key Metrics Data 2024: Overview,” Gartner, December 2023.
To keep customers locked in,
software vendors like IBM offer
bundled deals that include lower
support costs if customers make
new software purchases at the
same time. These bundled services
and products typically come
with multiyear enterprise license
agreements (ELAs).