Forrester Expands 'software Bill of Rights'

Rampant vendor consolidation, the rise of SaaS (software as a service) and other factors have prompted Forrester Research to add 11 entries to its "Enterprise Software Licensee's Bill of Rights," a list of privileges the analyst firm believes customers should be entitled to throughout the software selection, implementation and production lifecycle.

By Chris Kanaracus
Wed, July 08, 2009

IDG News Service — Rampant vendor consolidation, the rise of SaaS (software as a service) and other factors have prompted Forrester Research to add 11 entries to its "Enterprise Software Licensee's Bill of Rights," a list of privileges the analyst firm believes customers should be entitled to throughout the software selection, implementation and production lifecycle.

One of the new rights focuses on SaaS, which has become an increasingly popular deployment option among enterprises.

For one, SaaS vendors should be providing customers with adequate escrow protections, wherein a third party retains a copy of the application's source code, user data and related information, according to Forrester.

"This whole issue of SaaS escrows is going to get more and more important, especially as SaaS companies get taken over or go bankrupt," said the report's author, Forrester analyst Ray Wang, in an interview. The warning is underscored by developments like SaaS BI (business intelligence) vendor LucidEra's recent announcement it would be closing its doors.

Vendors should also get more specific about which product features will work out of the box, according to the report. Features "should be classified as 'no modifications required,' 'minor configuration' and 'major configuration,'" Wang wrote. "Custom capabilities not included in a standard deployment should be called out."

Other added rights cover contract negotiations and the day-to-day relationship between vendors and customers.

For example, vendors should add up and report how much money they are receiving overall from customers for licenses, maintenance and other expenses. This "total account value" should "play a role in determining discount levels and preferential treatment," Wang wrote.

In addition, the report stresses that customers should be allowed the option of procuring maintenance services from third-party companies, and insists that vendors provide customers with a single, executive-level point of contact who is responsible for ensuring the implementation is successful.

Overall, Forrester's recommendations would clearly tip the scales in favor of users. But the economic recession has already prompted a series of conciliatory gestures from vendors, ranging from price cuts to flexible maintenance and upgrade options.

Indeed, now is the time for customers to make the case for and lock in such measures, given the fact that vendors are struggling to make new license sales but also continuing to enjoy highly profitable maintenance revenue streams, Wang said.

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