RE: Tierred pricing (was Tiger tools...)

Exactly.

PHil


> -----Original Message-----
> From: midrange-l-admin@midrange.com
> [mailto:midrange-l-admin@midrange.com]On Behalf Of Westdorp, Tom
> Sent: Tuesday, October 30, 2001 2:07 PM
> To: midrange-l@midrange.com
> Subject: RE: Tierred pricing (was Tiger tools...)
>
>
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> >>
> >> >2.  Does the software for a larger machine require more
> >> >coding, support etc. to make up for the difference?
> >>
> >> Depends on the product, but it is not unreasonable to
> >> expect more support issues
> >> with 1000 concurrent users than with 10.
>
> >Yes, I can see this, but we're talking processor level, not
> >users.  User based tiered pricing is the lesser of the two
> >evils for the fact you pointed out, but it's not sold as
> >such in the iSeries world.  It's based on processor level.
>
> The processor level basis is what's screwed up.  I used to work
> for a hotel
> software company, and they charged by processor group.  Hotel W
> licenses the
> software for $n.  They learn to love the AS/400, and decide to move to
> AS/400 based financial software.  This requires getting a bigger
> box, so the
> hotel vendor shows up with its hand out looking for more $n+.
> Why?  No more
> rooms, no more guests, no more revenue, just a bigger capacity
> AS/400.  The
> financials outfit also demands more money because of the size of the box.
> It could run on a p10 alone or a p20 with hotel.  The hotel people can
> understand if you price per hotel room, build a new tower and the price of
> the hotel software goes up because you're doing twice as many rooms.  The
> tiering by processor level is just plain wrong, except for the OS.
>
> The software houses are too lazy to develop their own tiering
> model, so they
> ride on IBM's.  Suppose Code/400 was based on processor level.
> If I ran it
> on my 720 with 10 pgmrs I'd pay $X, but if I run it on my 830
> with the same
> 10 pgmrs it's $X+.  Still ten pgmrs.
>
> Each piece of software needs it's own tier basis.  Some by hotel
> room, some
> by number of accounts, some by number of seats, etc.  One size doesn't fit
> all, nor does one tier structure.
>
> -----Original Message-----
> From: Brad Stone [mailto:brad@bvstools.com]
> Sent: Tuesday, October 30, 2001 10:49 AM
> To: midrange-l@midrange.com
> Subject: Re: Tierred pricing (was Tiger tools...)
>
>
> On Tue, 30 Oct 2001 13:30:32 -0500
>  Douglas Handy <dhandy1@bellsouth.net> wrote:
> > Brad,
> >
> > >1.  Besides the fact that it's the "norm", what reasons
> > are
> > >given for the need to price software on a tierred level?
> >
> > To make it affordable to a wider range of customers.  If
> > priced uniformly, the
> > averaged cost would be cost prohibitive for the small
> > guy.
>
> Ah yes... but this could also be looked at as "To charge the
> guy with the bigger machine more money, becaues they must
> have more to spend."
>
> I expected the answer you gave.  :)  I don't buy it, though.
> It's the answer you would get from the seller, not the
> buyer.  Which leads to the fact that iSeries software is
> overpriced to begin with.
>
> >
> > >2.  Does the software for a larger machine require more
> > >coding, support etc. to make up for the difference?
> >
> > Depends on the product, but it is not unreasonable to
> > expect more support issues
> > with 1000 concurrent users than with 10.
>
> Yes, I can see this, but we're talking processor level, not
> users.  User based tierred pricing is the lesser of the two
> evils for the fact you pointed out, but it's not sold as
> such in the iSeries world.  It's based on processor level.
>
> >
> > >3.  What other industries tier their pricing for the
> > SAME
> > >product?  (ie gas costs the same for a ferrari and a
> > tempo).
> >
> > Try government taxation. :)  If the business makes more
> > money, Uncle Scam wants
> > a bigger share.  Same with King Louie.
>
> Well, I'll give you that one, but the goverment is screwed
> up more than IBM is.   :)
>
> >
> > BTW, gas *does* cost more for my Northstar engine than
> > for a Ford Tempo...
>
> Different octane is different product.  And you don't NEED
> 92 octane for your Northstar.  I doubt it's compression
> level requires it, no matter what your Caddi dealer told
> you.  :)
>
> Bradley V. Stone
> BVS.Tools
> www.bvstools.com
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