Drittanbietersupport – Chance oder Risiko?

12/05/2022

Third-party support – opportunity or risk?

Software vendors sometimes calculate with average price increases (about 5%) per year or link their price increase to the producer price index for IT consulting and support. A reduction is only possible, if at all, through consistent inventory management, i.e., discontinuing maintenance for licenses that are no longer needed, but this is sometimes counteracted by lower discounts or corresponding contractual clauses. One way of reducing costs (in some cases by 50% - 80%) in the area of software support is to switch to so-called third- party maintenance/support providers, but this entails certain restrictions.

Third-party support essentially only plays a role in classic purchase licenses since rental licenses are usually coupled with manufacturer maintenance/support. In the case of purchase licenses, the right of use passes into the ownership of the purchaser. Volume licenses are often sold initially with software maintenance and support (the designations vary depending on the manufacturer). As a rule, there is no obligation to renew the license. Even after the end of support, the software can be used with the acquired use right, but is limited to the version level that was available at the end of the software support. This brings us to the opportunities and risks of third-party support.

The following figure provides a compact comparison of the main differences between vendor and third-party support, which will be briefly explained in detail later on.

Third-Party Support

Update right: The right to use the current software version is only available via the software manufacturer. If this is not required, for example because a version status has been frozen or new versions are to be skipped, a lot of money can be saved by means of third-party support. However, the decision should be made on a sound basis, as retroactive maintenance payments are due for licenses that are to be taken back under maintenance.

Support of "end of life" versions: Standard maintenance provided by software vendors usually covers only a defined period in the software lifecycle, namely until the software reaches its "end of life". In addition, support is only provided if standard maintenance is maintained and extended support is purchased at an additional charge. Third-party providers, on the other hand, often provide maintenance for older versions of software at no extra charge.

Software Code Changes: The program code of software is protected by copyright. For this reason, only the software manufacturer, as the originator of the code, can make changes to it. Third-party providers are not permitted to do so. From the customer's point of view, the risk must be weighed up here, which depends, among other things, on the stability and "maturity" of the software version used.

Problem fixes and patches: In addition to the right to update, software maintenance also includes the provision of bug fixes for the software. These are usually based on bug reports from their entire customer base. Third-party support providers, on the other hand, use self-developed workarounds and patches for troubleshooting, which are often created in response to individual customer situations.

Security patches: In addition to bug fixes, software vendors also provide patches to close security gaps. This is particularly important when systems are accessible via the Internet, for example. Third-party support providers rely here on security measures they have developed themselves (e.g., so-called software hardening, in which corresponding vulnerabilities are closed by configurations in the software).

Service level: The support conditions (e.g., response times) of software vendors are highly standardized and do not allow for individualization. Third-party support providers also have standard support conditions but show more accommodation for individual customization requests. Moreover, their standard terms and conditions often offer better service levels and rely on dedicated as well as more experienced support resources.

A decision for or against third-party support can ultimately only be made after individual consideration of the contract situation, vendor strategy, software roadmap and financial situation, weighing up the opportunities and risks. In practice, third-party support is primarily an option for legacy applications or systems that are about to be replaced by the cloud.

If you have a potential use case for third-party maintenance or would like to have your software portfolio examined for potential savings, please contact us.

 Author: Felix Baran