1 2 3 Previous Next 61 Replies Latest reply on Mar 3, 2016 3:13 PM by beverly

    Annual license or perpetual license?

    douglerner

      For our use, I think each person will need a copy of FileMaker Pro 14:

       

       

      http://store.filemaker.com/US/ENG/RTL/product/purchase/


       

      We don’t need the “advanced” version because we are just using this as end clients and somebody else is doing our development.


       

      The cost is $329 per copy for a perpetual license. But there is also this option which might be more attractive:


       

      http://store.filemaker.com/US/ENG/LIC/


       

      As you can see there, you can purchase annual licenses, which are just $9/month per license. But it seems they need to be purchased annually, which means it would be $108 per license per year. So it would take 3 years to match the cost of the perpetual license.

       


      Since FileMaker aggressively upgrades every year it seem the annual license might be the best way to go.


      What do others think?


      Thanks,


      doug

        • 1. Re: Annual license or perpetual license?
          keywords

          I don't know what you mean by "aggressively upgrades", but I agree that annual licensing is cost effective if you intend to keep your software up to date. It enables you to upgrade immediately without additional cost whenever a new version is released. Historically, I think it is more like 18 months between version upgrades, but that is still well under 3 years.

          • 2. Re: Annual license or perpetual license?
            Extensitech

            I'll readily admit that I was originally skeptical of annual licensing. I just wanted to "buy it and be done with it".

             

            I've come around, though, and now we push the AVLA option for our clients. Using your three-year example, where would you be in year four with software you own outright? Even if you allow that some solutions don't need new features (working just fine, thank you very much)... sooner or later, you're going to want a new feature. Now you're making the purchase again, and spending as much if not more to upgrade.

             

            On the flip side, we've had clients that had a significant drop-off in number of users, or a few that got bought out by other companies who had their own software, so they (sadly) had to part with FM. Those clients saved money by paying a fraction of what they would've paid for software that they ended up not needing.

             

            To really make a perpetual license pay, you need to stay in your original version, and ignore features from later FM versions and all your developer can do with them. You also have to potentially give up support for your version, from FM and/or your developer. I've had a couple clients who did that, because frankly their original solution worked fine in the original version.

             

            When they did come back and need changes, though, it was terribly difficult. Either we ended up doing work in a legacy version (which slowed us down and made us more expensive) or they upgraded three or four versions at once and basically blew their users' minds.

             

            So, IMHO, annual licenses all the way.

             

            Chris Cain

            Extensitech

            • 3. Re: Annual license or perpetual license?
              Mike_Mitchell

              keywords wrote:

               

              Historically, I think it is more like 18 months between version upgrades, but that is still well under 3 years.

               

              History's about to change ...  

              • 4. Re: Annual license or perpetual license?
                Mike_Mitchell

                Extensitech wrote:

                 

                To really make a perpetual license pay, you need to stay in your original version, and ignore features from later FM versions and all your developer can do with them.

                 

                The exception being if you're a developer doing work for a broader base of clients. As you mentioned, you might find yourself in a situation where you have to deal with an older version, so backward compatibility becomes important.

                 

                But for most cases, the AVLA is a good deal.

                • 5. Re: Annual license or perpetual license?
                  davidhead

                  Extensitech wrote:

                   

                  I've come around, though, and now we push the AVLA option for our clients. Using your three-year example, where would you be in year four with software you own outright? Even if you allow that some solutions don't need new features (working just fine, thank you very much)... sooner or later, you're going to want a new feature. Now you're making the purchase again, and spending as much if not more to upgrade.

                   

                   

                  The other thing to bear in mind is that perpetual licenses include the first year maintenance free. If you choose not renew after the first year, you drop off any eligibility for upgrades.

                   

                  So let's say a customer buys v14 licenses for $3000 and choose not to renew maintenance. They will probably get the next version within a 12 month release cycle. But say after three years they want the current version, they would need to repurchase at the original price.

                   

                  After three years on AVLA they have paid $3000, and they are on the current version.

                  • 6. Re: Annual license or perpetual license?
                    BeatriceBeaubien

                    Hi Doug,

                     

                    There seems to be misapprehension that VLA's mean getting stuck on the version you originally purchased. However purchasing a VLA would normally mean you also consistently buy into yearly maintenance, which gives you the privilege of deciding which version you deliver to your users, including the most recent version. Thus over a short number of years, VLA's are more cost effective than AVLA's and offer more choice in supporting your users.

                     

                    The factors in deciding between AVLA and VLA are also contingent on the following, albeit from my perspective in a large organisation where the enterprise has been using FileMaker for many years:

                    • Will the organisation purchasing the AVLA understand what is involved when they undertake to uninstall all FileMaker applications if they don't renew? AVLA is a yearly contract between the organisation and FMI and stipulates the licenses are only valid if the contract is current. Conversely, VLA gives you the right to keep using the software even if you cease paying the maintenance. If the organisation has a large installed base for an AVLA, this requires before they enter into the contract, they also understand this operational consideration.

                    • If the organisation entertains the possibility they will be using FileMaker over a period of years, it is more economical to purchase the VLA as mentioned above.

                    • There has been some discussion that AVLA subscribers are encouraged to keep current and upgrade. Again, in some organisations this is feasible, however in large installations it is less so.

                     

                    As purchasing a VLA without paying subsequent years' maintenance doesn't make economic sense, keeping software up-to-date is a wash between the two programs. VLA's permit you to have a more flexible choice if it is important to maintain older versions for some solutions.

                     

                    We will continue with our VLA maintenance, as when we do the comparison numbers every year it is more fiscally responsible for our enterprise.

                     

                     

                     

                    HTH

                     

                    Best wishes,

                     

                    Beatrice

                     

                     

                    On Mar 1, 2016, at 18:42, douglerner <noreply@filemaker.com> wrote

                     

                                              

                    Annual license or perpetual license?

                    created by douglerner in Discussions - View the full discussion

                     

                     

                    /snip

                     

                    The cost is $329 per copy for a perpetual license. But there is also this option which might be more attractive:

                     

                    /snip

                     

                    As you can see there, you can purchase annual licenses, which are just $9/month per license. But it seems they need to be purchased annually, which means it would be $108 per license per year. So it would take 3 years to match the cost of the perpetual license.

                     

                    >

                    • 7. Re: Annual license or perpetual license?
                      bigtom

                      After 3 years the cost of maintenance on a VLA is about half that of AVLA. If you intend to stay with FM for 5+years it is your best decision to use a VLA. You can decrease you number of VLA users at renewal as long as you are not under the minimum of 5 seats to have the VLA.

                       

                      If your operation revolves around concurrent connections this is a different story and you may want to look at an SLA if you are considering licensing 15-20+ concurrent connections on AVLA or VLA. I suppose a combination of 10 FMP and 10 connections might make the SLA/ASLA look like a better idea as well.

                      • 8. Re: Annual license or perpetual license?
                        douglerner

                        I am finding the comments here helpful and interesting. But I am acronym-challenged!

                         

                        What do the following mean?

                         

                        VLA

                        AVLA

                        SLA

                         

                        Thanks,

                         

                        doug

                        • 9. Re: Annual license or perpetual license?
                          MarcDolley

                          douglerner wrote:

                           

                          I am finding the comments here helpful and interesting. But I am acronym-challenged!

                           

                          What do the following mean?

                           

                          VLA

                          AVLA

                          SLA

                          If it begins with an A it's annual. If it doesn't, it's perpetual.

                           

                          AVLA/ASLA = Annual Volume/Site License Agreement

                          VLA/SLA - Volume/Site License Agreement

                           

                          All of our clients are now on AVLA. Partly because clients have a habit of just looking at the $'s and see better value in paying one third of the cost of a perpetual license, without actually factoring in that it's an annual cost rather than a one off. Go figure. Also, until recently here in Australia, it made better business sense. Perpetual licenses were considered an asset and were subject to depreciation. Annual licenses were classified as rental and could be written off immediately. A year or so back, the government extended the value which could be written off immediately and that meant that most VLA purchases fell within the limit.

                           

                          As a developer, we also prefer AVLA's because the renewal is processed by us and it gives us an opportunity to communicate with clients we may not have spoken to for a year. We've picked up quite a bit of work from AVLA renewals.

                          • 10. Re: Annual license or perpetual license?
                            bigtom

                            There are tax benefits for an annual license since it is a leased asset as MarcDolley described. You can generally write of the entire cost immediately. With perpetual/owned license you technically need to depreciate the asset over time, but if the renewal for maintenance is yearly and we start to see annual updates you might be able to depreciate the costs faster. Ask your tax account about it.

                             

                            Annual contracts are attractive to startups that need working capitol and might be looking for investments. They need to minimize expenses and maximize deductions to make the numbers look good. If FM is helping the business make money I would say the extra costs of the annual license over time would be marginal compared to the total profit gained from using FM. If using FM is increasing profit for you by $100,000/yr and your AVLA is $2,000/yr, it is not a large relative expense compared to the $1,000/yr for the VLA even though it is more.

                             

                            This is really a decision that needs to be evaluated per client for their goals and needs. Thankfully FM offers different licensing options.

                            • 11. Re: Annual license or perpetual license?
                              douglerner

                              I also saw some mention of a minimum of 5 seats. Is the annual licensing option available for less than 5 seats? Or is only a perpetual license possible in that case?

                               

                              doug

                              • 12. Re: Annual license or perpetual license?
                                bigtom

                                To get a VLA for FMP and FMPA you need a minimum of 5 seats. I am not sure if they will allow fewer than 5 seats if it is connected to a FMS VLA contract. There is a large lack of information from FM about licensing in general.

                                • 13. Re: Annual license or perpetual license?
                                  MarcDolley

                                  douglerner wrote:

                                   

                                  I also saw some mention of a minimum of 5 seats. Is the annual licensing option available for less than 5 seats? Or is only a perpetual license possible in that case?

                                   

                                  doug

                                   

                                  The entry point is one FM server and/or five FM Pro. If you're buying it through the online store, you can only go with those options.

                                  • 14. Re: Annual license or perpetual license?
                                    douglerner

                                    Hmmm...

                                     

                                    I haven't done the actual purchase, but at the online store it does let me put just 1 annual FM Pro license for $108 in the cart and proceed to the final step of checkout with no warnings that I need more licenses.

                                     

                                    doug

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