Gartner Research

Migrating Perpetual Licenses to SaaS Subscriptions With the Same Provider Can Be More Costly and Risky Than Many Expect

Published: 03 September 2015

ID: G00277790

Analyst(s): Lori Samolsky

Summary

Software license vendors are promoting incentives for migrating perpetual on-premises license customers to their new SaaS subscription solutions; those incentives carry risk and license pitfalls that technology procurement professionals must evaluate before signing away their perpetual licenses.

Table Of Contents
  • Key Challenges

Introduction

Analysis

  • Calculate the Current Trade-In Value of Bundled, Perpetual On-Premises Licenses Based on Purchase Date, License Price Paid and Current Use
    • Accounting Principles Used Internally Will Solve Some Unanswered Questions
    • The License Value Decision Rests in Your Hands If You Wish to Negotiate
  • Negotiate Key Contract Terms for the Return to Perpetual On-Premises License Use Before Licensing for Any SaaS Solution
    • Numerous Risks Must Be Evaluated Against the Potential Gain of Returning to Perpetual Licenses
    • Lack of Proper Contract Terms for SaaS Migrations With the Same Vendor Will Generate Unbudgeted IT Spend and Continuity Risks
  • Treat Every SaaS Migration as a New Project — Evaluate the Licenses Required by Performing Pilots, Validating Functionality, and Ensuring Clear Transition Plans Are Documented for Use of Perpetual On-Premises Licenses Until Go-Live of SaaS Functionality Is in Place
    • Timelines for Migration Vary; So Should On-Premises License Use
    • Follow Good Procurement Practices When Migrating Perpetual On-Premises Applications to a SaaS Solution, or Face Known SaaS Contract Risks
    • Plan Every Migration As If It Were Independent of Any Other Purchase

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