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Re: [LUG] Devon Finances: Guestimated cost of non opensource: £130,000 pa

 

Kevin Tunison wrote:
> On Thu, Jan 1, 2009 at 10:31 AM, Henry Bremridge
> <henry.bremridge@xxxxxxxxx> wrote:
>   
>> On the following assumptions:
>>
>> - No of users: 6782
>> - Cost of Microsoft Office per User per Year: £20 (or £60 every three years). 
>> This is a guess on the principle MS will heavily discount the cost of enterprises 
>> licenses to encourage use in public sector organisations.
>> - New computers purchased every 4 years (bit of a guess: I believe that most 
>> computers would be thrown away every 2-3 years, but all would have to be renewed 
>> at least every 4 years)
>> - Cost of Microsoft (as opposed to Linux) per PC: I am guessing £20. I am aware 
>> that retail OEM MS Operating systems go for about £50, but again I do not believe 
>> that large public sector organisations pay that
>> - Interest Rate (Borrowing cost). I am assuming 5%. (The lower the interest rate, 
>> the more the total cost of staying with MS. I do not know what the borrowing 
>> costs for Devon County Council are but I would be surprised if they could not 
>> borrow at less than 5%).
>> - The cost of switching Bristol's 6000 computers was a one time cost of £643,000
>>
>> Then the cost of not switching to Microsoft for 10 years is £1.3m or £130,000 per 
>> year, with a payback of period of the cost of switching of 5 years
>>
>> Summary of figures changing key variables
>>
>> Computers                               6782    6782    6782    6782    6782    
>> 6782
>> License Fee MS Office   10              20              50              10        
>>       20              50
>> Computer renewal rate   4               4               4               4         
>>       4               4
>> Cost of MS software             20              20              20              
>> 20              20              20
>> Investment Hurdle               10%             10%             10%             
>> 5%              5%              5%
>> Total Cost                              £0.6m   £1.0m   £2.3m   £0.8m   £1.3m   
>> £2.8m
>> Cost pa                                 £0.06m  £0.1m   £0.2m   £0.08m  £0.1m   
>> £0.3m
>>
>> Question
>>
>> a) Does anyone know for certain how often computers are changed in Devon. Is it 
>> every 3 years or 4. (If computers are changed every three years then the cost of 
>> staying with MS increases by about £100,000 pa)
>>
>> b) Does anyone have any realistic idea of how much enterprise software licenses 
>> cost. I am assuming that the MS charge £20 per user per year. That could be too 
>> high on the principal that MS might effectively give away the software to ensure 
>> that County Councils use MS and hence all users are encouraged to use MS.
>>
>>
>>
>> --
>> Henry
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>>
>>     
>
> If you are going to consider pushing this up for serious debate at the
> business level, there are some other factors to consider.  These are
> all things that Microsoft Licensing Sales Specialists are trained to
> handle, and will pound from the other side of the pulpit.
>
> 1) How MS products are deployed in the environment, is this automated or not
> 2) The man-hours involved in such a deployment
> 3) The cost of those man-hours
> 4) Amount of support calls and time regarding ms office
> 5) The cost of that support in man-hours and money
> 6) Any downgrade costs associated with licensing, as many
> organizations do pay this, suprisingly.  ie downgrade from Office 2007
> to 2003.
> 7) Existing Infrastructure tie-ins with outside vendors and office
> 8) The cost in time and money associated with removing those tie-ins
> and/or technical barriers to entry
> 9) Any other outstanding agreements that may either:
>      a) Force the purchase of Office licensing based on the licensing
> package the organization is subscribed to
>      b) Be a contract between the organization and license reseller
> (this is not Microsoft, ie Ramesys) preventing outside software from
> being installed
>      c) Be a support contract with an outside vendor that only allows
> support of 'approved' software packages
>
>
> With regards to your questions:
>
> -a) Does anyone know for certain how often computers are changed in
> Devon. Is it every 3 years or 4. (If computers are changed every three
> years then the cost of staying with MS increases by about £100,000 pa)
>
> a)  With volume licensing this point is moot.  The number of active
> machines are audited annually, and the license fees are adjusted
> accordingly.  In the MS Licensing realm, this is known as a true-up,
> so the client in year one may pay for 20 machines, a month later add
> 250 workstations, but not have to pay for 270 licenses until the next
> fiscal year.
>
> -b) Does anyone have any realistic idea of how much enterprise
> software licenses cost. I am assuming that the MS charge £20 per user
> per year. That could be too high on the principal that MS might
> effectively give away the software to ensure that County Councils use
> MS and hence all users are encouraged to use MS.
>   
You raise a good few points here,  I guess we really need to decide on

a) whom we are aiming at in the first instance.
b) whether we should start by concentrating on pushing for ISO 
standards, as in my signature. 
c) if we need to actually find out what the business community actually 
need first then see how we can offer services.  How would we do this
more important
d) who can actually offer the services, i.e installation, support etc 
etc so a business can call up and its a one stop shop for what they need.

Paul


-- 
Paul Sutton
www.zleap.net
Support Open file formats ISO 26300 odt
Next Linux User Group meet : Jan 3rd : 2pm,  Shoreline Cafe Paignton


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