November 30, 2010

How Telerik Shot Their Customers

At work, we've been using Sitefinity for two years now. During that time, it has evolved from an unstable mishmash of components to a software package that many feel is enterprise ready at a price-point that was lowest in their competitive set ($899) and a great development story.

Last month, they announced their new pricing model, and there has been a bit of an uproar. We've had multiple conversations and phone calls with Telerik with no success trying to show them how they've essentially shot their customers in the face with this move. They announced their pricing structure change with less than 60 days notice, hardly enough time for any business to make a shift in their budget. They're supporting 3.x until 2013, but it's a dead-end development environment since 4.x is where they'll be focusing all of their energy. But the biggest reason that this is a horrible story for all involved is they have screwed users who need to convert from one edition to another in the interest of keeping things simple for themselves.

They have several differentiating features, and rather than make them key-unlocks for features or allow CAL's to extend concurrent users (more on this shortly), they decided to bundle everything into five versions. If you have any single data point that exceeds your version at any point, you have no choice but to upgrade, and those upgrade costs aren't pretty.

You're a small business user, and you need a second concurrent user or a fifty-first page? Depending on when you need that page or user, you'll be paying anywhere from $1,499 to $1,899 for that one piece of content. Standard edition and need a sixth editor or load balancing? Cough up $5,999 to $7,599. Professional edition and need an eleventh editor? $11,999 to $18,399 or screw you.

It does get worse. Industry best practices tell people to go for a single sign-on model when dealing with systems. Rather than go for the standard "named user" CAL model, they've gone with "concurrent users," and their definition is that even if you aren't editing the site, if you would normally have back-end permissions, you count against that concurrent user count even if you sign into the site. The new licensing model is forcing Telerik to tell people to go against industry best practices.

The Telerik CEO Complaint Thread on this is ~620k at the moment. I only see it growing, unfortunately. Telerik took all of the community goodwill that it had, and rather than gradually grow the price over time as their feature set grew and grandfather their supporters, they stomped on the community that got them to where they are in hopes of playing with the big leagues.

The really sad thing is that they are already doing key unlocks. If you compare a Small Business version of Sitefinity 4.0 RC with an Enterprise version of Sitefinity 4.0 RC, guess what's different? The license file and a single .config file in the /sitefinity/configuration folder, and that second file is just metadata for their project manager. Their decision to restrict licensing in this manner shows that they have absolutely no regard for actual usage patterns. They could easily add in extra CAL support in their current architecture, but they choose not to, not because of their users, but because of their preferences. They could easily make load balance support, localization, workflow, etc., feature unlocks, but choose not to. They're quite vocal that they chose this route because they wanted to keep things simple for them. That's not a business plan. That's arrogance before the fall.

Best of luck to them. They'll need it.

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