Reading many of the comments below it's clear to me that most commentators have never worked in the enterprise.
Anyone who has purchased enterprise software knows full well that you never pay "once". Far from it.
- For most organizations, using software without a support & maintenance contract is not a viable option, and yearly support & maintenance cost is typically ~20% of the product "list" price of the product. Many customers of large enterprise vendors typically see these costs go up every year. There has been revolts over this but often customer does not have much leverage.
- Unlike SaaS, companies who buy software products, have to pay for implementation and ongoing operations of the software as well. Enterprise products can be quite complex and require one or more people to operate it. Implementation costs alone can be hefty (often higher than software cost itself) and make SaaS a much much better option for the customer.
- Enterprise is littered with products that purchased but never used or no longer used. What looks like a good solution does not work, or requirements change, etc. In short, unlike SaaS where customer has almost no risk, customers take a lot of risk by buying software products outright.
Comments
Reading many of the comments below it's clear to me that most commentators have never worked in the enterprise. Anyone who has purchased enterprise software knows full well that you never pay "once". Far from it.
- For most organizations, using software without a support & maintenance contract is not a viable option, and yearly support & maintenance cost is typically ~20% of the product "list" price of the product. Many customers of large enterprise vendors typically see these costs go up every year. There has been revolts over this but often customer does not have much leverage.
- Unlike SaaS, companies who buy software products, have to pay for implementation and ongoing operations of the software as well. Enterprise products can be quite complex and require one or more people to operate it. Implementation costs alone can be hefty (often higher than software cost itself) and make SaaS a much much better option for the customer.
- Enterprise is littered with products that purchased but never used or no longer used. What looks like a good solution does not work, or requirements change, etc. In short, unlike SaaS where customer has almost no risk, customers take a lot of risk by buying software products outright.