For use by the OE IT Design Team only Software licensing Main questions Now ­ What licenses are held at which level? How much do they cost? ­ How do these costs compare with those that might be obtained by aggressive contract negotiation, perhaps for a larger number of seats? Going forward ­ What are the Best Practices re: software acquisition, software distribution, and contract management? ­ Where are there economies of scale? ­ What are the barriers to purchasing through negotiated agreements? Are there incentives? ­ What are the options – on campus, at other UCs, in the “cloud”? Our current campus services ­ what we do now Customer value/software license products ­ Standard desktop software, e.g., Microsoft Office Suite, Adobe Creative Suite ­ Operating systems for individual machines and servers ­ Utilities ­ Security ­ Specialized software o Cross­discipline, e.g., statistical packages o Discipline/activity­specific, e.g., CAD­CAM, fundraising Cost/price factors included in the negotiation/calculation ­ Type of licenses o New (purchase) o Renewal (maintenance) ­ License term o Annual renewal September 1, 2010, v. 2.0 rm+dw Page 1 of 45 o “License term” then renewal o “Perpetual” so no renewal ­ Media o Delivered through the Internet (most; saves 9.75% sales tax) o If hosted on campus, server and associated costs o Some require receiving a CD, DVD, or flashdrive because of the file size or problems with different operating systems ­ The target user o Server o Single­seat = one machine o Person = one person w/five machines needs only one license o “Knowledge worker” FTE ­ Operating system ­ Version of software ­ Demand/volume ­ Transaction/key management/convenience/forecasting demand/pre­sales consulting add­on o In­house, perhaps 30% (IST draft, August 2010) o Outsourced . Rolled into cost to customer . Separate cost for the University ­ Key: estimating demand and then tracking purchases so that unused licenses can be “harvested.” Communication/promotion ­ Web­based o OCIO Strategic Technology Acquisition (STA), http://technology.berkeley.edu/cio/fptis/sta/ . Strategic Technology Toolkit, http://technology.berkeley.edu/cio/fptis/sta/toolkit/index.html o IST . Software Central, http://software­central.berkeley.edu/ . Technical Account Management (TAM) Services, http://ist.berkeley.edu/services/tam . Departmental On­site Computing Support (DOCS) explanation of MCCA, including comparison with Microsoft Select program, http://ist.berkeley.edu/files/DOCSMCCAInfo2010_0.xls, also see Appendix B on page 13 (two pages). o Cal Student Store Software Shop (run by JourneyEd) for steeply discounted single­copy licenses, http://www.bkstr.com/CategoryDisplay/10001­85252­ 10433­1?demoKey=d ­ Listserv­based o Annual (usually) call for projections/commitments on purchases . Both new and renewal (“maintenance”); see annual MCCA meeting announcement, http://ls.berkeley.edu/mail/micronet/2009/1728.html . Servers vs. group vs. individual September 1, 2010, v. 2.0 rm+dw Page 2 of 45 Convenience/place of distriBution ­ Examples of the method of distribution (who hosts the software for download or distributes the media – CD, DVD, or flashdrive) across different “agreement” categories Agreement UC+UC UCOP­negotiated jointly Campus­negotiated No Host, e.g., (=> three negoti­ agree­ server location campuses; => ated aka ment 2 or media $50k/year) “Campus “User” pays OCIO/IST pays Free/ pickup1 share” shareware Campus [Not . Mathematika (or . Symantec . Firefox (Web . Software currently download CD) EndPoint browser) Central3 used, . SPSS Protection . Thunderbird . Cal Student although . SAS (DVD or . Cisco VPN (Virtual (email client) Store there is flashdrive) Private Network) (journeyEd)4 consider­ . JMP . Hyperion plug­in able . CalAgenda for BAIRS Vendor interest.] . Matlab (Math­ [Vendor] works) Other . Microsoft Office Berkeley is moving . Software Suite (Microsoft toward using e­ House Consolidate Campus Academy to International Agreement – MCCA manage the (SHI) – “mehk­ah”) distribution of the . e­Academy Adobe five statistical Filemaker packages. Lotus 1 If server­hosted, CalNet authentication is used to verify campus eligibility status. 2 “User” could be a department, a lab, a group, a person with one computer, or a person with up to five computers, depending on the software involved. 3 Software Central @ Berkeley, see http://software­central.berkeley.edu. 4 The Cal Student Store, managed by Follett, works with journeyEd to deliver software at an educational discount. See http://www.journeyed.com/?ref=select. September 1, 2010, v. 2.0 rm+dw Page 3 of 45 Current environment – costs and revenues Keywords ­ Transition. ­ Little or no tracking of licenses: negotiated, ordered, “unharvested.” ­ Only optional tracking of products purchased, so little data available. Synopsis ­ The negotiation of both system­wide licenses (see Appendix A on page 12) is done through OCIO’s Strategic Technology Acquisition services. ­ The Scholars’ Workstation (TSW), under IST’s Client Services, used to manage both departmental purchases and individual purchases of software. o TSW used to negotiate for three of the main statistical packages (Matlab, Mathematica, and SPSS) and sell all five statistical packages (including SAS and JMP, which are negotiated at the UCOP level), but did not practice strategic acquisition – either forecasting demand with any accuracy or inventory control. TSW now been dismantled and the management of these statistical software packages has been moved to IST’s Client Services. o Departments purchase . Directly from a UC­specified clearinghouse, e.g., Software House International (SHI), (mostly) through a link on Software Central; . Directly from the vendor, (mostly) through a link on Software Central; . Or by reimbursing the employee who has made a purchase. ­ A closer look at four statistics packages to illustrate some of the complexities Software License # of users IST’s Cost : (Vendor) term (current Basis of cost for revenue Moving agreement) cost the forward license Mathe­ 11/1/08­ . Unlimited . Total . 2008: FY 11: Plan to charge matica 10/31/10 use site student $16,459 $10,785 30% over total (Wolfra license for HC = . 2009­ cost from m) single users 33,933; 2010: Wolfram for . # of pro­ technical $26,958 processing; ? cesses that student possible to solve run at one HC = deficit? time = 26 7,012. JMP 4/15/10– 110 users Depart­ . 2008­ . 2008­09: Plan to charge (SAS) 4/15/11 (estimate mental 09: $330 30% over total reported to estimates $1,900 . 2009­10: cost from SAS UCOP as part sent to . 2009­ $98 for processing of the UCOP 10: . 2010­11 contract $1,900 (as of process) . 2010­11 8/1): $955 (as of Current 8/1): price to user $2,142 is $39. September 1, 2010, v. 2.0 rm+dw Page 4 of 45 Software License # of users IST’s Cost : (Vendor) term (current Basis of cost for revenue Moving agreement) cost the forward license SAS 7/1/10­ . 275 Depart­ 2010­11: 2010­11 Plan to charge (SAS) 6/30/11 workstations mental . Servers price: NA 30% over total . 18 servers estimates $16,233 cost from SAS sent to . Worksta for processing UCOP tions: $9,954 SPSS 7/2/10­ 750 Perpetual . 2008­ . 2009­10: Better esti­ (SPSS) 7/1/11 maintenance license; 09: 41% of mates; bal­ licenses only pay $77,164 licenses ancing new and (single­seat) for annual . 2009­ bought not maintenance; @ three renewals 10: sold BUT students different aka $15,049 . 2010­11: can buy more levels each mainten­ . 2010­ $6,750 cheaply in the for Windows ance; 11: marketplace machines and depart­ $12,249 (four yrs UCB: Macs mental $350; outside estimates $100) The numBers ­ All software­related account codes for FY 2009­2010 for the entire campus: Total spend = $10,665,506. Account (code + description) OCIO and IST The rest of campus Actuals $ %-age Actuals $ %-age 54243 ­ Software => $5K <$10M 0 0% 145,349 2% 56020 ­ Software Licenses, Purchase 446,649 13% 3,168,138 43% 56021 ­ Software Licenses, Maintenance 2,764,703 83% 2,701,355 37% 56022 ­ Non­inv Software<$200 5,036 0% 339,102 5% 56023 ­ Software=>$200<$1,500 57,736 2% 321,191 4% 56024 ­ Software => $1,500 < $5K 41,003 1% 212,027 3% 56031­ Depreciation­Software < 10M 0 0% 463,218 6% TOTAL $3,315,127 100% $7,350,380 100% o How the account codes work . Purchasers may assign any account code they wish. It is not clear what is included in 56022 through 56024 – new licenses, renewals, media? o Two codes did not return any data for FY 2009­10 . 54242 – Software =>$10M . 56030 – Depreciation­Software =>$10M o Source: BAIRS Customer Report by Fund – 9 col for all software­related account codes for FY 2009­10, all months, all funds September 1, 2010, v. 2.0 rm+dw Page 5 of 45 ­ Vendors for all software purchases for FY 2009­10 Actuals $ %-age Vendor listed 8,778,380 82% Vendor not listed 1,887,127 18% TOTAL $10,665,506 100% ­ Individuals vs. "company" vendors for all software purchases for FY 2009­10 # of vendors Actuals $ Individuals 513 156,096 "Companies" 617 10,509,411 TOTAL 1,130 $10,665,506 ­ Another cost to consider: the cost of a purchasing transaction Using paper­based processes (CSU et al­used metric) $130 Using a bluCard (UCSD­used metric) $40 ­ Individuals as vendors – value of their software transactions in FY 2009­10 ­ Range $7.99 ­ $3,280 Assumption: one individual = one transaction ­ Mean $263 # of individuals 513 ­ Median $148 Cost/transaction $130 ­ Mode $99 Total cost of individual $66,690 transactions ­ “Companies” as vendors – value of their software transactions in FY 2009­10 ­ Range $3 ­ $923,073 ­ Mean $13,987 ­ Median $1,600 September 1, 2010, v. 2.0 rm+dw Page 6 of 45 ­ Top 20 “company” vendors in FY 2009­10 Note. For the complete list of “company” vendors, see Appendix E. Rank Vendor Total $ 1 SOFTWARE HOUSE INTERNATIONAL INC $923,073 2 ORACLE USA, INC.