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Late renewal fee

Late renewal fee

Late renewal fee

(OP)
Hi,

Today our VAR intoduced, as he told us, new SolidWorks Late renewal fee policy: the longer You are not on subscription, the bigger late renewal fee (a penalty?) You will have to pay when You want to be on subscription again.
1)Is it everywhere or just here in Latvia?
2)Is it correct to demand money from customer just because he had not used Your services for some period of time?

I hope it is allowed to ask such questions here...

Best regards,

Antons Kuzmins
CAD administrator
Sidrabe Inc.
Latvia

 

RE: Late renewal fee

I'm not certain about that being the same here in the USA, but I remember my previous VAR mentioning something like this several years ago.

Perhaps the thing to weigh is whether you need the subscription service--software upgrades and support--to the degree that you must pay for them in maintenance contracts.  Weigh that with the actual costs of allowing maintenance to lapse for a while.

For example, here the lapse fee used to be ~$500.  So you could drop your maintenance after each contract for, say, six months.  Since maintenance costs tend to be near ~$1,500/year, that saves you ~$250 each contract renewal, and you're typically not falling too far behind with such a method.  Maybe this strategy is what SolidWorks is attempting to avoid by increasing their "reinstatement fee".

As to whether charging a customer for reinstating lapsed maintenance--no, I think that's a cheesy way to run a business.

 

Jeff Mowry
www.industrialdesignhaus.com
What did you dream?  It's all right--we told you what to dream.
    --Pink Floyd, Welcome to the Machine

RE: Late renewal fee

Paul Salvador mentioned this a couple months back on the comp CAD forum.  According to his info the new penatly fee for not renewing subscription is pretty harsh.  It's actually cheaper to purchase a brand new license then let your subscription lapse for 3 years and renew it, or something like that.  Seems unreasonable to me.   

Rob Rodriguez CSWP
www.axiscadsolutions.com
www.robrodriguez.com
http://designsmarter.typepad.com/rob_rodriguez/
Eastern Region SWUGN Representative www.swugn.org  www.nvtswug.com
SW 2007 SP 2.0
 

RE: Late renewal fee

Oh, brilliant.  Great timing.  Score another one for AutoDesk.

 

Jeff Mowry
www.industrialdesignhaus.com
What did you dream?  It's all right--we told you what to dream.
    --Pink Floyd, Welcome to the Machine

RE: Late renewal fee

FYI,

I am still using 2005 and this copy has never been on maintainance.  About a year ago I asked the local VAR for a quote to get on maintainance.  At that time, I was told there was no reinstatement fee because I never was on maintainance, only the regular maintainance fee.  About three weeks ago I got another quote which now included a $500 "late initial subscription fee" in addition to the regular maintainance fee.  For me it appears to be cheaper to get on maintainance than to buy a new license.

Timelord

RE: Late renewal fee

That's what the VARs told me before as well.  Perhaps they've changed their policy without letting you know?  If you ask very nicely maybe they'll drop the fee (I've seen that happen with clients).  Or maybe they're PTC in SW clothing...

 

Jeff Mowry
www.industrialdesignhaus.com
What did you dream?  It's all right--we told you what to dream.
    --Pink Floyd, Welcome to the Machine

RE: Late renewal fee

Just curious...what's stopping you from buying a "personal" license or a license for a phantom company in order to avoid a "late initial renewal fee"?  Might be a little devious, but then I like to stick it to The Man when I can.

Dan

www.eltronresearch.com

RE: Late renewal fee

(OP)
Thank You all for interesting answers.

Yes, previously, it was something about 500EUR (at least here in Latvia) for Late renewal fee without taking into account, how long You have not been on subscription. Now our VAR is telling: for EACH year You are not on subscription, Late Renewal fee is getting bigger and bigger...
In my opinion, it is like You go to dentist with toothache, and he tells You: you have not been here for 2 years, first pay for not going to me regularly, and only then I will take a look at Your teeth...
Like a fine for NOT using their service. Not pretty at all.

Antons

www.sidrabe.com

RE: Late renewal fee

(OP)
Dan,

Latvia is a small country, and it is hard to make a deal with some phantom company without VAR knowing what is going on. And as far as I know, it is not allowed to resell SW if you are not an official VAR.

Antons  

RE: Late renewal fee

(OP)
Jeff,

When Late renewal fee was only 500EUR, it was a normal practice also here in Latvia to make a discount for it, but it seems that this is no longer the case.

Antons

RE: Late renewal fee

This is just a trend in how SW is starting to treat the user base. I hate the new licensing process and it is a real pain in the azz transferring and problems that happen when you do it. On top of that, what happens in a couple years and they quit supporting license transfers if you are not on maintenance and then you need to transfer to a new computer. I have always thought their should be two types of maintenance for SW , one for if you want the updates and a second for support from the VAR. I hardly ever needed VAR support so I hated paying for it.  

RE: Late renewal fee

(OP)
Hi again everyone,

Some more info from our VAR: from now on it will be impossible to upgrade to new version without taking subscription service (is it everywhere or only in Latvia?). So the longer You are not on subscription, the less motivation (regarding money: penalty is getting bigger and bigger) to upgrade to new version, eventually less motivation to work with SolidWorks at all.
IMO, in the end they will lose a lot of clients that way.

Best regards,

Antons

RE: Late renewal fee

Here is a copy of Paul's post from comp.cad that outlines the new fees.

At $2500 for reinstatement after a 3 year lapse plus the  $1200 maintenance fee you're only a couple hundred short of just buying a new seat license.

Paul,
After July 16th SolidWorks will increase the fee to renew an expired SolidWorks/Cosmos to $850.00 per year. This fee will increase an additional $850.00 per year thereafter.

Example:
Seat expired 90 days to 1 year - $850.00 plus Annual Maintenance

Seats expired 366 days to 2 years – 1700.00 plus Annual Maintenance

Seats expired 2 years to 3 years - $2500.00 plus Annual Maintenance

GoEngineer did not want any of our customers to miss the opportunity to reinstate any expired SolidWorks/Cosmos asset at the existing rate. Reinstating your expired SolidWorks/Cosmos assets between now and July 16th 2008 can be done at the existing rate of $500.00 per seat plus Annual Maintenance.

Please contact your Customer Service Representative.

Customer Service Representative
GoEngineer


 

Rob Rodriguez CSWP
www.axiscadsolutions.com
www.robrodriguez.com
http://designsmarter.typepad.com/rob_rodriguez/
Eastern Region SWUGN Representative www.swugn.org  www.nvtswug.com
SW 2007 SP 2.0
 

RE: Late renewal fee

It seems that Solidworks is becoming more like Autodesk every day and that is not a good thing.  

RE: Late renewal fee

"The question is, why should anyone pay for services they didn't get.  Does SW magically go back in time to offer support to the client retroactively?  :) "


I agree with this theory, but if you carry it through then why should anyone get upgrades they didn't pay for?  So if you skip two years of maintenance and want to get back on should you get the latest version without an extra fee?  I think not b/c you never paid for the previous two.

Cole M
CSWP, CSWST, CSWI, CPDM
HP XW4300, 3.4g proc, 2.5g RAM, ATI Fire GL 3100
Dell M90, Core 2 Duo, 2g RAM, Nvidia Quadra FX2500M
Equus (custom), P4, 3.4g proc, 3g RAM, Nvidia Quadro FX3400

RE: Late renewal fee

That would expose the ruse that tech support and software upgrades cannot be separated.  Apparently they can, and they've now been priced.  $850 per upgrade per year, the remainder for tech support.  Should I be optimistic in believing I can purchase only the software upgrades and not the support?  (Probably not.)

This brings up a problematic business model--that of the direct utility of the VARS--and I think this is why we'll see friction with SW in making this idea (software-only, service a la carte) available.  How would their VARs stay in business?  They might lose 30% of their revenue right off the top--a tough hit.

 

Jeff Mowry
www.industrialdesignhaus.com
What did you dream?  It's all right--we told you what to dream.
    --Pink Floyd, Welcome to the Machine

RE: Late renewal fee

I have issues with the benefit of version after version. The fact is that SW is a pretty mature product at this time. All they are adding here and there are tweaks. The fact is if it wasnt for customers using a later, version most of us would be happy with the version we already have. The version incompatibility is the only reason most people stay up to date.  

RE: Late renewal fee

Our subscription ended 5/31, and the var just called and said they'll charge us $50 more per seat ($100 total for us,) if we don't renew today.

Wow! They really know how to put the pressure on.

We haven't paid for var help since 2000, just the upgrade package so we can stay current with our customers. The people at the resellers have all been nice, knowledgeable and helpful, and they offer fun informative monthly get-together training sessions, but the software is pretty simple and there is plenty of help here and in other forums.

I've liked the new features in each release, and really start appreciating service packs at about 3.1. Other than that fun, most of what we do could be done in SW2003 or earlier, whenever they did the major update to the sheet metal functions.

Diego

 

RE: Late renewal fee

That's what I'm starting to see, along with Rocko's comments about the software maturing now.  Makes each version less important, since the "improvements" along the way are usually reserved for UI tweaks or small feature additions to reduce the long-hand way of doing things.  Great points!

 

Jeff Mowry
www.industrialdesignhaus.com
What did you dream?  It's all right--we told you what to dream.
    --Pink Floyd, Welcome to the Machine

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