Gartner’s research predicts that software licensing fees are set to fall in the next decade.
In a research note, Gartner VP William Snyder said: “Up until now the unique nature of the software market has meant that buyers had very little negotiating power after the initial purchase of a software license. We expect those dynamics to change considerably over the next five to 10 years giving CIOs and software procurement officers more bargaining power while potentially reducing software vendor profit margins.”
Several emerging trends, such as software-as-a-service, SOA (Service Oriented Architecture), and low-cost development are expected to stress traditional software margin structures.
Alternatives are emerging at a rapid pace, giving software buyers greater choice and hence additional bargaining powers.