SAP to kill TomorrowNow

SAP kills TomorrowNow. It would have ideally sold the unit after the Oracle lawsuit, but the reality is that hanging sword made the sale to someone else a non-starter. Also many parts of SAP they have been ambivalent about TN because it opened them to the question "If TN is good for Oracle customers, why is it not good for SAP customers? Why don't you offer SAP customers something similar?"

So, what does it change? Not a whole bunch. Along with printer ink at $ 5,000+ a gallon, mobile overseas roaming at $ 3 a minute, outsourced storage at $ 3 a gb a month, software maintenance with its 95% gross margins is one of the most "empty calories" in tech spend.

One price does not fit all in any market category, but software vendors keep ignoring that truism for maintenance. 3rd party service like that offered by Rimini is attractive to mature customers who have little interest in future releases and want to pay less for current ones. Will always be a percentage of a vendor customer base, but if the software vendors do not offer them a choice, others will.

I have written before, just because you buy a Porsche you are not required to buy service at their dealers. If anything Consumer Reports has shown independent garages often offer better value and service. Rimini has shown it can deliver regulatory updates earlier than Oracle can. Customers should have the choice, not be intimidated into going back to the auto dealer.

So here's a note to Oracle. Gloat if you want. But these are YOUR customers who sent you a message. Customers you could have retained and kept happy with different service packages and price points. And TN or not, more of them will leave till you start listening to them.

And one to SAP. The question still remains. If TN was good for Oracle customers, when are you going to offer your own customers a similar package?

Update CIO Magazine perspective with comments from Bruce Richardson of AMR, Ray Wang of Forrester and me.