Disruption comes in threes: ITAM Insights Report 2023

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Disruption comes in threes: ITAM Insights Report 2023

Double-digit software price rises, “license gouging” and vendor M&A activity creates uncertainty for CIOs and ITAM in 2023

Rich’s keynote at Wisdom EMEA 2023 this morning focused on the “Stories that shook the ITAM world.” To complement the session, and to provide a resource for those who weren’t able to attend the event, we have launched our first annual ITAM Insights report, a collation of the most notable ITAM events from the last 12 months. The result? A 23-page analysis of the changing cost of software, hardware and cloud, as viewed by those charged with managing it – you, the ITAM professional.

By collating all of these events in one place and providing analysis of their broader business impact, our ambition is for this report to be an invaluable resource to help you influence your stakeholders, updated annually. This is something you can take to other IT professionals, C-level executives, and any other stakeholders in your organisation to help you in your goals to manage IT assets, maximize ROI and minimise disruption to the business.

Click here to download the ITAM Insights 2023 report

Commenting on the findings of the report, Rich said, “Businesses rely on predictability and certainty to plan for the future, particularly when it comes to their costs. But the last 12 months have been anything but certain. Even if you discount the political events, the amount of change within the IT industry itself is enough to raise eyebrows in the boardroom. When you’re facing – at best – double-digit prices rises now and potentially significantly more in the near-future due to seismic changes in the licensing terms of core business software like IBM and Oracle, this is no longer just something for IT Asset Managers to worry about. This is a board level concern.”

“The “ITAM Insights 2023” report presents a comprehensive analysis of the key industry events that are expected to shape the IT landscape throughout the year, and is essential reading for anyone who needs to understand the main changes coming their way – from day to day through to long-term strategy.”

The report examines the three main changes to IT management in the last twelve months, namely double-digit software price rises, significant changes to software licensing contracts among tier 1 software vendors (i.e. “license gouging”), and a wealth of Mergers & Acquisitions among software publishers. The report examines, among others, the following developments:

Global price rises

• IBM global price increases for all non-SaaS products of around 24% in most regions including GBP, EUR, Japanese Yen etc. (SaaS products received their own, albeit lower price increases)
• Microsoft “price harmonization” saw most prices rise in double digits (e.g. GBP: +9%, EUR: +11%, Danish Krone: +11%, Norwegian Krona: +11%, Swedish Krone: +15%
• Oracle support costs up 8% in US and APAC

Contract & Licensing changes

• IBM Passport Advantage self-reporting requirements: Customers now required to measure their own consumption of IBM licenses and report to IBM on their request within 30 days
• Oracle Java switches to an all-encompassing “employee” licensing, whereby an employee includes full-time employees, part-time employees and temporary employees (i.e. contractors, outsourcers, consultants etc.). Some customers are reporting this change alone could see costs increase by up to 10x

Mergers & Acquisitions

• TIBCO + Citrix merger: February 2022 saw the acquisition of Citrix for $16.5 billion by “Vista Equity Partners” and “Evergreen Coast Capital”: Mergers & acquisitions involving software companies often leads to an increase in compliance audits, thus there is now an increased risk of software licensing audits focusing on Citrix software.
• OpenText acquires Micro Focus: Both organisations are well known for their difficult and aggressive audit tactics, and it is our view that customers should be prepared for new compliance checks and audits within the next 12 months.
• Broadcom looks to acquire VMware for $61 billion: In addition to the expectation of price rises for some VMware products, it is likely that Broadcom will look to divest many of the less profitable parts of the VMware portfolio, meaning uncertainty for customers using those product lines.

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