Re: A possible non-foward looking statement that could take the placeof a roadmap

In article <463815a7@xxxxxxxxxxxxxxxxxxxxxx>, rot13.wjrfgre@xxxxxxxxx says...

Correct. The rules governing SA are straight forward. You buy SA for a
year at (for ease of computation) $1200. This is recognized monthly,
say $100/month.

I don't think it is quite that straightforward.

Every example I've seen (for some have now been sent my way - thx all) would
suggest that SA is a support contract, not a subscription.

In which case, revenue recognition gets messy since some portion of the
upgrade entitlement aspect of the support contract fee has to be deferred
until the upgrades that the customer expects to get are delivered.


CodeGear might like to CALL SA a subscription, but if it's all simply about
what you call something then SOX and SOP-97 can be made to go away with
judicious application of Roget's thesaurus - no need for expensive lawyers and
accountants.

:)

Since we're told that it's not that simple, then, well, it's not that simple.


So, if I have customer A who buys SA on January 1 for $1200 bucks and I
have customer B who just buys the license for $1200. An upgrade is
annouced at the end of Q1 for shipping at the end of Q3. For Customer
A, CG justs keeps on recognizing $100/month.

SA is not a subscription in any sense that I recognise. For one thing, it
includes support elements (incidents etc) and is only available as an "add-
on" to a license purchase, and makes specific reference to receiving
_upgrades_.

You cannot take out a subscription and receive a license that is valid for the
period of your subscription. You must purchase an open ended license (that
remains valid even after the SA term expires, which would not usually be the
case with a software subscription) and you buy SA specifically in order to
receive either upgrades, support incidents or both.

This creates the upgrade right.

It is upgrade right that causes revenue recognition problems with roadmaps.


So in fact, for all that CodeGear are protesting that SA is the answer to
everyone's problems, actually I think it's the CAUSE!


For Customer B, CG can
only recognize $480 until the upgrade ships at the end of Q3 at which
time the remaining $720 can be shown on the books and actually spent.

Not according to E&Y (in the article that Nick himself referred me to).

In that, Customer B has no upgrade right since the vendors history of charging
for upgrade licenses and not offering them as entitlement by right to
licensees of previous versions, acts to remove any doubt that there may be any
upgrade right.

But since it's about perceived upgrade right (vendor history is only a
contributing factor to the extent to which any expectation is created) even
this can be solidified by simply stating on any roadmap that products shown
will be available to licensees of existing products ONLY upon payment of the
upgrade fee that applies at the time of release of any NEW product.


Of course, I'm only going by the documents that CodeGear themselves appear to
be referring to......

:)
.

Relevant Pages

  • Re: No good SA downgrade option available
    ... It may be that things are a little confused between traditional license purchase and a true subscription model, and this has the bad effect of trying to enforce both - a contradiction. ... You simply do not get the benefit of SA and will have to pay full upgrade price for any future version. ...
    (borland.public.delphi.non-technical)
  • Re: Question About SA
    ... A new license purchase could have a longer intial subscription than someone ... Of course, for CodeGear, the issue will be the timing of revenue recognition. ... A new license or upgrade gets recognized immediately, ...
    (borland.public.delphi.non-technical)
  • Re: norton antivirus
    ... If you would read the license, you would see it was one license to one ... once the one year subscription ends you will ... > need to upgrade to the next version. ... you will have to reinstall the OS and start from ...
    (microsoft.public.windowsxp.general)
  • Re: SOP for salvaging OS (legal stuff) of dying machine
    ... Could be an generic OEM version. ... either be a full version or an upgrade version. ... OEM versions stick to the first host on which they are installed. ... The EULA just stipulates the OEM license ...
    (microsoft.public.windowsxp.general)
  • Re: why is CodeGear/Borland not selling old versions?
    ... "I have just purchased an upgrade license from Delphi 7 to BDS ...
    (borland.public.delphi.non-technical)