atcomsystems.ca/forum Forums VOIP Phones & IP PBX VoIP & Cloud Phones, Hosted PBX, General IP Phones Software Licensing Fees and VOIP Systems

Although you probably won't rep for a voip manufacturer long, consider offering apples to apples as best you can. You know 8 X 20 with cost of equipment, cost of lines vs ether, (Tricky, huh?) costs at end of 1st year, you then get to show them Licenses versus .........? Then show them how you transfer a call on each type of phone. Bring up external paging if applicable. Analog applications, fax, CCV, alarm(s). Don't forget to show the cost of NEW CAT5E/CAT6 network versus the already in place (or not) CAT3 or less cabling. Then show them the PSTN 'cloud' with dotted lines for voip, versus solid lines for POTS lines. If they ask why the dots, hesitate and then 'admit' that voip still has some issues that are VERY expensive to cure. "Your gonna lease the equivalent of 2 PRI's to get decent audio!" And the circuits are NOT 100% reliable. 99.5 maybe, but POTS are 99.99999999999 reliable and 'stuff' ALWAYS goes bad at the WORST possible time! It's going to take some serious training, and more thought for presentations, but, if you get it across, you'll NEVER lose that customer to voip, 'cause you ARE going to be there with voip when it is really what it's supposed to be! Hmmm, maybe I'll try selling strictly against voip and get out of the tech side! The emphezema has me pretty much helpless anyway! John C. (Not Garand)

Based on what i have read there is no annual fee, unless of course your confusing this with a maintenance contract. After i posted i contacted an IT manager of a call center, whom recently switched out their Alcatel units for Cisco call managers. He vehemently expressed that there is no annual license renewals.

My opinion is while i see how exeburant the cost can be (for device and added feature licensing)this is really no different than what i have experienced with Nortel as of late. The BCM and CallPilot voice mails are prime example of this, its all about licensing.

That's for Cisco as of late...we'll see where the 3rd party SIP licenses go. Ask a Televantage owner now. Or Altigen now or...I've found 7 other manufacturers and counting.

The other night on Chat I ask about Liscensing and the VOIP advocates on the board acted like there weren't any unless you chose them,Why would you sell a product that you could not use to it's fullest without these reacuring fees.

I found this in a search, basically some city budgeting their finances...

Director Rains reported that in 2001 the City of Casa Grande launched the Voice Over Internet Protocol (VOIP) telecommunications technology at the Police Department. This technology moved the traditional telephone equipment, better known as a PBX, to a computer based application that would operate over computer equipment, network and infrastructure. The application that was selected for this technology was Televantage. It was acquired through the Arizona distributor, MBT Inc. In 2004, the second phase of this project was completed when the City Hall system was moved to VOIP with the same products and equipment. The completed project allowed the organization to begin utilizing a 3-digit code for calling staff and other departments. Prior to this, a 7-digit number was required. There are numerous advantages that have been recognized with the new technology. The acquisition of the annual software subscription allows the organization to maintain the most recent upgrades that are available for the application.

Reading the last sentence, it seems clear that the renewals are nothing more than mere scare tactics about being "current"; not that the systems will shut down and cease to operate. Maintenance contracts.

Apparently Casa Grade never heard of Centrex.

Today I did my dog and pony show at a customer. This is the one I have been talking in the Installer area with the outgrown Partner.
I got the pleasure of coming in last because I'm the incumbent. Amazing. I didn't get to see the names of the bidders yet, but they propose to do a hosted solution. If you call from your desk to the desk next to you, you go to someplace in NY to set the path on the ethernet and come back to your neighbor. Sip city, I guess.

This is a 9 year old company. I took over about 5 years ago because I'm about 5 miles from their front door and the other vendor was 100 miles away. I have seen them grow from 4 lines and 18 phones to the present 6x40 and the VM to 40 mailboxes. (two building expansions).

So as I pitch my Panasonic TDA, I answered all their needs in terms of paging, AA with English and Japanese prompts, and timed forwarding to external cell phones, future growth to 160 ports, and a generous trade in of the Partner hardware, they keep asking "how much a month for maintenance and renewal?" "How much to port our lines to alternative carriers" Huh?
I give them a blank look. Gee, Mr. Customer. YOU OWN EVERYTHING! The lines are converted to PRI as part of the service, not VoIP, not hosted phones. You might be charged T&M for software upgrades and MAC work like you have in the past, but there are no other charges or fees.

Wish I could see the proposals...and I probably will get to do that in December or January :-)

Carl

It is like my father in-law, he use to think, if he did not pay through the nose for something was no good. I remember when times were tight the customer would keep getting the system repaired and keep the system for 10-15 years, now they have the CG employed and he says the system is no good after 5 years, the boss doesn't know what the CG is on about but rather than looking stupid he agree's.

We dont have great broad band here and no sip-cip lines yet, but computer companys are selling the systems saying future proof yourself with this product, but not telling them they will have to buy a shed full of licenses and hardware to upgrade?

Since I think gene is talking about what he asked me, I'll clarify a little for the avaya side.

I don't know details about any systems with recurring license costs so I'll speak what I know.

Licensing for certain features are nothing new in the telecom world. The majority of voicemail systems out there have had some sort of license on top of the initial hardware and/or software cost for a very long time.
Nortel uses license codes for things such as PRI, voicemail, etc.
Avaya Definity system has had licenses long before VOIP came along for several functions also.
The Avaya IP Office has a long list of licenses for things too. The licenses for the IP Office are NOT recurring and are not needed for normal telephone functions. If you have hardware for X amount of phones, then X amount of phones will all work the same. It doesn't matter if they are TDM based or IP based, no license required. The licenses are generally for advanced features that many users would not have a use for so why roll the cost of such features into the system for those who do not need it. Here is just a few options that require a license:
Mobile Twinning-seemlessly handle calls from either your extension or cell phone.
Phone Manager Pro-pc application to control phone and pop up external programs such as ACT.
Phone Manager Pro Softphone-VOIP phone on your computer.
SIP trunking- for those brave enough to try it. lol
Advanced Networking- hotdesk between multiple systems.
Voicemail Licenses....
Networked voicemail- integrate multiple voicemail systems
Text to Speech
3rd party database integration /IVR
VB scripting
contact store - call recording library
conferening center
extra ports - no additional hardware required.

and the list goes on. Many of these licenses also have a 45 day trial license to see if you actually need the feature offered and all of the licensed features are "buy it once".

From the Vertical side... if your system is licensed for an 8X24 and you need to add a station or trunk or optional module ALL licenses must be current at the supported level. There are fees for sets and trunks. There is a software subscription fee that also insures software assurance to keep your system up to date. Without software subscription you are not kept up to date unless it is done manually. Licenses are not issued to previous versions of software that have been end of lifed. Again this is not a maintenance contract. It is a digital key to the castle. No current license= no support or expansion.
Nortel PBXs have used ISM parameters in groups of 100 for TNs associated with their PBXs for years. They would even support up to up to 5 levels back of previous software. Even more than 5 levels back would still get tech support but no new bug fixes or patches would be supported.

The new IP mentality is software charges that never go away. Endless patches and upgrades that take much longer and are issued much more frequently that TDM hybrid systems. One dealer was complaining that the IP Office took around a hour and a half to patch and upgrade. Does the dealer take that charge in the shorts? Does the customer pay? I have several 300 phone plus MP5000s that are upgraded in 45 seconds.

We did have one customer that we did sub work for call one Monday morning and asked that we contact them via cell phone...they didn't renew their software licenses and their IP switch was dead. I'll see if I can get the manufacturer name from them.