Hidden Software Costs and How to Avoid Them

The initial price of the software is typically pretty clear. However, people are often surprised when they run into hidden software costs down the road. When picking a software program ask about any future costs that may be involved. Here are two charges that are the most irritating to run into after you purchase and how to not be surprised by them.

1. Software Updates/Upgrades

Many software companies sell the software wholly for a stand-alone price. The buyer will then need to re-purchase every few years or purchase any major upgrades that are released. These updates are necessary so that the software will continue to work with all other new technology that is released each year. But when not expected, these charges can be surprising and discouraging.

The best way to avoid this is to purchase a software program that offers yearly maintenance or support contract that includes all updates. These contracts are generally cheaper than re-purchasing the software every few years. This allows you to more easily see what the ongoing costs are going to be and budget accordingly.

Expired Support Contracts

The oil & gas industry is always changing and updates are regularly needed for newer operating systems, 1099s, regulation changes, and various other reasons. To save money, some clients will try to skip out of a year of support.

The intention is to save money this year, and then renew later if needed, or to simply skip out of paying support for a few years. This typically doesn’t work very well as most software companies require that you purchase past updates as well.

When a support contract is used for updates, then a fee is typically charged to be reinstated to support. The result is that the savings weren’t very much and typically not worth the hassle.

Software is typically only supported for a set number of years and if you skip out on support for the duration of that period, then you may find yourself in a spot where you have to re-purchase the software because support is no longer available for your version.

To avoid the costs associated with re-establishing a support contract it is best to simply maintain your relationship with the software provider by staying current on support. This is typically the cheapest way to maintain long term use of a software program.

What other hidden software costs have you run into?

Phil Sherwood

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