Tuesday, January 19, 2010

Yearly Rant About Yearly Upgrades

John Heckman publishes the Does It Compute? blog. A great resource, where he spends a good deal of time analyzing the most popular law firm software, including Amicus Attorney, PC Law, Time Matters, Worldox, etc. Today John had a great post exposing the exploitation that is the annual software update -- thoughts with which I entirely agree (Amicus it is one of the main reasona I left ya!). Here is what John has to say:
OK, so I sound off on this subject a lot more than once a year, but I couldn’t resist the title. I have often been asked why I am so adamantly opposed to yearly upgrades. There are two main reasons.

The first is a simple a priori: there is not a software company in existence, not even Microsoft, that has the resources to develop stable, worthwhile upgrades yearly. Microsoft, in fact, is notorious for buggy initial releases and new versions. In order to justify a new release, you need to offer “new” features. So existing bugs don’t get fixed and new bugs are introduced. Features that had previously been introduced are not fixed, rounded out or developed to their full potential – so you have an increasing number of half-baked features that were once “new.” To the extent that a firm holds fast to yearly releases, the quality of its software will get buggier and decline. LexisNexis encountered this problem and was forced to skip a year between versions 9 and 10 of Time Matters and then tout TM 10 as primarily a bug fix release (remember the disastrous service release of v. 9.3 which corrupted data in the database?).

This problem hit Gavel and Gown with particular acuity this year. Late in 2009, Compulaw, which makes court rules tracking software, made major changes to the underlying code of its software, with the result that it would no longer work with any existing version of Amicus. So willy nilly, G&G had to rewrite the integration. This obviously impacted seriously on the development of Amicus 2010. The rational thing to do would have been to delay the release of 2010 so that the Compulaw integration could have been fixed (there are a relatively small number of firms that use Compulaw, mainly in California, but those that do depend on it heavily) and other items scheduled for inclusion in 2010 finished. But no, the January 1 release date had to be maintained, so the final release was even more marginal than it otherwise would have been. Things that might otherwise have been fixed will probably now be put off until 2011, because with a yearly development schedule it is almost impossible to do anything but fix the most urgent bugs in between releases. For example, an improvement to the Custom Records function also introduced a new bug in that feature.

In a similar vein, although Time Matters 10 was promoted as a bug fix release, it did manage to break some of the integration with Worldox, even though no changes were supposed to be made to that integration.

The second main reason I object to annual releases is the one that has caused LexisNexis so much grief: clients deeply resent having to pay for “bug fix releases” every year. Annual releases are in effect an effort to “churn” the existing client base and extract more money from them without really offering very much that is worth it. Gavel and Gown would do well to draw the lessons from the public relations disaster Lexis has had with Time Matters and stop trying to imitate the policies that produced it.

Software companies try to disguise this issue by offering Annual Maintenance Plans (or “AMP’s” in Lexis-speak). This gives you the “new” version every year in exchange for a monthly fee. The argument is that then a firm is “always on the latest version” which makes life easier all around. Typically over a 3 year period these plans amount to a 15-20% premium over what a normal firm would spend by having just a tech support and upgrading when the cumulative incremental releases start to add up – about every 3 years or so. In fact, these annual plans are a half-way house on the path toward the Software as a Subscription (SaaS) model.

The fact is that most firms do not want to upgrade every year. The “if it ain’t broke, don’t fix it” mentality is firmly embedded in their consciousness and with good reason. So these plans come across simply as a way of squeezing more money out of clients in return for fixing bugs.

Typical yearly tech support is generally 20% of the purchase price of the product. The yearly maintenance plans tend to run closer to 40% of the purchase price of the product. There are still programs that offer tech support at a traditional rate AND include future upgrades in that support. Worldox and Tabs/Practice Master come to mind in that respect. But perhaps the most interesting example is (or was) PCLaw prior to its acquisition by LexisNexis. PCLaw offered all future upgrades with its reasonable yearly support plans (10-25% of purchase price depending on the number of licenses). AND tech support was a profit center for PCLaw. So all of Lexis’s subsequent increase in prices are either pure profit or represent a dramatic decrease in the efficiency of tech support.

In short, annual releases (1) will inevitably result in buggier software; and (2) are just a blatant attempt to extract more money from a given client base for very little in return.
Please click here for the original article.

Please be sure to visit www.hardinglaw.com, the website for the law firm of Harding & Associates, for more information on California family law.

1 comment:

Brett Owens said...

We've actually found it easier to include free updates and support with the initial purchase price of our product, Chrometa...and we're not broke yet :)

On the contrary, I think it's helped accelerate adoption for us. Though when you have an existing product and marketshare, perhaps the focus is more on extracting every last penny out of your existing user base.

In summary, completely agree that maintenance contracts are BS if value is not being added in return.

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