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Message: Meaningful discussion

Meaningful discussion

posted on Jul 01, 2007 03:13PM

My conclusion form previous discussion: Most large companies can quickly approve an $XM expenditure (multi million $) if the cost of delay is likely to be multi millions more than X.  Thus, most companies are not delaying buying a license because of internal approval cycle times.

 

From my experience I would say TPL could reasonable give large companies 30 to 40 days notice that prices will rise by x%.

 

If you accept my 30 to 45 day estimate as reasonable then we should start seeing license buys in July, unless:

1)      Companies think that delaying is not necessarily unfavorable to them; they think the court case may still go either way.

2)      Companies think that delaying is not necessarily unfavorable to them; they think that the price of a license can’t change very much from what’s currently being asked of them or compared to the historical prices – a court might not support outrageous license price increases, if it came to a court case.

 

If TPL has already raised the prices, companies may have every reason to delay (increase exists now), if they think they’ll pay about the same price 6 months from now. So TPL might do well to notify companies of a time line ladder of price increases. But this seems complex to me.

 

In any case, I’m not sure I go along with the idea that TPL would delay selling licenses now with an expectation of higher prices later. In any business, lots of unfavorable things can happen later. And, I’ve said it before, a few big companies signing on now could cause an avalanche of buying, and in such an environment substantial price increases might seem natural.

 

Warning: the above is free opinion and worth every cent.

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