Sage 100cloud Migration Incentives Are Ending

Posted by B/P News & Notes on January 3, 2019 at 3:18 PM

Sage Incentives EndingSince the release of Sage 100cloud in 2016, Sage has been pushing hard for customers to migrate away from the perpetual license software model and to the subscription-based version of their software. The efforts encouraging customers to move to the subscription model have included some “carrot and stick” tactics:

  • Carrot – Parity Pricing for 100cloud Migrations: Customers who would pay more on a 100cloud plan than their perpetual plan are able to migrate to 100cloud at the perpetual rate at the time of renewal.
  • Carrot – $0 Migrations: Customers on perpetual plans outside of their renewal month can migrate now for no cost now and pay the new subscription price at their next renewal.
  • Stick – 20% Annual Increase on Perpetual Maintenance Renewals: Sage has indicated that customers who do not migrate to 100cloud can expect to see their annual maintenance prices increase 20% or more.

(See below for examples of promotion pricing.)

Sage has now announced the end of the “carrot” promotions & discounts, and we want to make sure you know your options.

As of April 1, 2019, customers on existing perpetual plans who decide to move to the subscription model will no longer receive discount incentives to migrate to a subscription. Those customers who remain on perpetual maintenance can expect to see increases of 20% or more annually. This means some customers who don’t take advantage of the migration promotions now may see significant increases in their annual fees.

Ultimately, the decision of whether or not to move to the subscription model will come down to what is best for your business in the long run. It is important to note that the products are essentially the same, which means that there is no need for re-training. Sage 100cloud is still deployed on premise or hosted. As with any subscription product, renewal of Sage 100cloud is automatic unless you cancel ahead of your renewal date.

The primary difference between perpetual and subscription-based versions is the difference between owning and renting the software. If you choose to cancel your Sage 100cloud subscription, Sage converts the product to a read-only version, locking out your ability to transact with the solution.

This sounds threatening, but when you stop for a moment and think about this situation, a few scenarios should help ease your mind. Normally, when a company decides to come off maintenance or stop paying a subscription, they have other plans in place, such as moving to a new solution. In that case, you’ll coordinate the date to stop payments against going live on your new solution. The same thing happens if a company is acquired and takes on a legacy system. The reality is that some type of plan will likely be in place at your organization that would prompt you to stop paying for your software, making this “read only” threat far less risky. Most importantly, your partner team at Bennett/Porter & Associates will always be available to help coordinate the transition to a new platform or preserve vital data, should you choose to cancel your Sage 100cloud subscription.

The positive news is that Sage is incenting you to migrate to the subscription version by bundling modules with Sage 100cloud as added features. These modules are not included in your perpetual Sage 100 version without purchasing them (Visual Integrator is the primary example, and you may already have purchased this module with your perpetual version). You can also upgrade to the SQL platform for no additional cost when you are on the 100cloud subscription version.

Additionally, Sage has collaborated with a number of extended solution providers to integrate limited versions of enhancements for the Sage 100cloud version only. These ISV extended enhancements will not be available to Sage 100 perpetual version users. One example is BeanWorks, which is Sage’s A/P automation system. Lastly, Sage 100cloud will provide better pricing year over year when compared to the perpetual version’s annual maintenance pricing. The catch? These extended solutions will come with an additional cost to fully utilize, so your company may not see value in the offering.

As a long-time user of Sage software, you have maintained your renewals over the years, and the decision to stop renewing likely won’t be made overnight. There is no requirement to install now or perform a forced upgrade if you do choose to migrate to Sage 100cloud (Sage 100cloud only comes in versions 2016, 2017, and 2018). You retain the right to determine when to upgrade to Sage 100cloud, even though you may subscribe now in order to receive the price discounts offered by Sage.

Bennett/Porter & Associates is committed to helping our clients succeed on their terms. We have struggled to see the benefits of 100cloud, and we share the concerns many of our clients have expressed regarding being forced into renting the software they already purchased and use without accessibility limitations. Nevertheless, with the 100cloud migration promotions coming to an end, and with Sage adding the new third-party integrations into Sage 100cloud not available to your existing perpetual license, we also know that the opportunity to slow the rate of increase year after year is also coming to an end. For specific information on your organization’s Sage 100cloud migration options, please contact us today.

 

**The following examples are for illustration purposes only. Please contact us for your specific pricing**

Example of the Parity Pricing Promotion: A customer with a perpetual maintenance renewal of $3,219.30 in January, February, or March 2019 could be looking at a 2020 perpetual renewal of $3,863.16 or more, or an option of migrating to subscription in 2020 for $3,780.00. But, if they take advantage of the current promotion, they can begin a Sage 100cloud subscription now for $3,219.30 and have a renewal in 2020 of $3,542.00

Example of the $0 Migration Promotion: A customer with a perpetual maintenance renewal in April 2019 or later who paid $3732.75 in 2018 could be looking at a 2019 perpetual renewal of $4,479.30, or an option of migrating to subscription in 2019 for $5,744.00. But, if they take advantage of the current promotion, they can begin a Sage 100cloud subscription by March 31, 2019 at no cost and pay $4,106.00 at their 2019 renewal date.

Topics: Sage Software, Sage 100Cloud