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Software · Vendor costs2 min read

Companies say 28% of software budgets go to upgrades they didn't want

A survey of 2,018 IT leaders says forced upgrades and vendor changes eat 28% of software budgets, often for no gain. The research comes from a firm that sells an alternative.

By the Dashline deskSource: The Register
Companies say 28% of software budgets go to upgrades they didn't want
Photo: The Register

Companies say they spend about 28% of their software budgets on upgrades, migrations and licensing changes they would not have chosen. That is the average answer in a new survey of 2,018 senior IT decision-makers in the US and UK. The research was run by Censuswide for Origina, a software support company, and published with Thinkers50.

What the survey found

The most recent vendor-driven change cost the average organization $12.87 million. And 95% said that in the past three years they paid for at least one such change while expecting worse reliability, performance or value.

The costs spread beyond software. 91% said they retired working hardware to meet software support deadlines. On average, that gave up an estimated 1.65 years of the hardware's remaining useful life.

The hidden costs

People are a cost too. 84% said experienced engineers were regularly pulled off other projects to handle vendor-driven upgrades and migrations.

That hurts new projects. Asked about the last time an AI or data project was delayed, paused or canceled, 90% said vendor-driven costs played at least a moderate part.

Why companies go along

76% said they have little leverage to negotiate with their major software vendors. Origina founder and CEO Tomás O'Leary said that when the other choice is losing support on systems the business runs on, saying yes is often a rational response.

Many respondents want rules. 91% backed legislation giving enterprise software customers protections comparable to those of long-term residential tenants. 82% supported software maintenance requirements similar to EU hardware repairability rules.

A caution on the source

Origina sells independent support for enterprise software, an alternative to a vendor's own maintenance and upgrade plans. It has a commercial interest in this argument. The figures are also survey answers from the people who responded, not audited costs.

What to do

  • Before signing or renewing, ask what the vendor can require you to change later.
  • Ask what support costs if you decline an upgrade.
  • Check whether your hardware must be replaced to stay supported.
The takeaway

Before you sign or renew software, check what the vendor can force you to change later, and what it will cost to say no.

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