Why do you pay for PLC programming software?

S

ScienceOfficer

Jiri---

The annual support renewal rate is shockingly low, but the demand for support is constant. The upfront fee guarantees revenue to support the development and delivery of the software. The profit my boss makes pays for me, and the initial handholding every new client needs.

Yes, if everyone paid their annual fees (as is common in the HVAC business, for example), everything would be clear about the business. When my client lets support lapse, I still find a way to help, as long as it makes business sense. My 28 year old installation, mentioned in my previous post, has bought little PLC stuff during my tenure--- but my boss and salesman get $100K/year in MRO business from the account, which is enough to justify my attention.

I reject the use of programming software as a loss leader. The software has value, its support has costs, and all of that must be paid for, somehow. Cheap software, in my experience, is worth the price. The payment has to be made somewhere. (And everything can be negotiated!)

An additional note: Our bestselling PLC programming and documentation software package costs $1100. If a one-time expense of $1100 is a problem for a plant, I can't imagine why I would want to call on it. Automation is supposed to be part of a profitable plant operation. $1100 is the cost of a small downtime or a minor mechanical breakage. If a one-time $1100 expense is a problem, the plant is undercapitalized, mismanaged, or failing, and not an attractive client.

Hope this helps!

Larry Lawver Rexel / Central Florida
 
C
And if $1100.00 for software to _start_ working and buying the really expensive stuff isn't questioned, the plant is mismanaged. Then there's the continuation costs, and so on. This never seems to get looked at and these gotchas come as unpleasant surprises. My point is that the cost of proprietary systems is high, complex, and nebulous but is always regarded simplistically. If a shop commits to a given product line, the $1100.00 is diddly for the vendor as well. Heck, that's the cost of one $5.00 serial card with a "special" connector or a couple of "special" cables. I would think the business and goodwill generated by giving away the razor would be worth it considering the margin on the blades. Especially since the razor is useless without the blades and no other blades will work. And having your razor greatly increases the probability that someone is gonna want your blades. Raising the threshold for entry just doesn't seem to make sense. For an inhouse shop your argument may hold, but for a small independent shop, $1100.00 for something that might only be used for one project is kinda steep. I have personally seen this up front cost kill projects, so someone cares about the $1100.00. But then, it does provide an opportunity for folks to do it differently. With less arrogance.

Regards

cww
 
Jiri Baum:
> > Of course, the question is whether it wouldn't be better to make the
> > 28-year thing explicit, as a support contract. The software itself
> > would then be correspondingly cheaper, or even more so if you
> > consider it a loss-leader.

> > Attempting to finance an ongoing thing from a once-off payment is a
> > always going to be a problem.

Larry Lawver:
> The annual support renewal rate is shockingly low, but the demand for
> support is constant.

That's a problem, of course.

> The upfront fee guarantees revenue to support the development and
> delivery of the software. The profit my boss makes pays for me, and
> the initial handholding every new client needs.

I've no problem with the initial stuff; it's the ongoing thing that bothers me, because it has a vaguely similar sense to pyramid schemes.

> Yes, if everyone paid their annual fees (as is common in the HVAC
> business, for example), everything would be clear about the business.

Yes, that would be the best.

> When my client lets support lapse, I still find a way to help, as long
> as it makes business sense. My 28 year old installation, mentioned in
> my previous post, has bought little PLC stuff during my tenure--- but
> my boss and salesman get $100K/year in MRO business from the account,
> which is enough to justify my attention.

That makes sense - if the client is a current client, still buying stuff, then the support can be financed from the new stuff they're buying, even if it's a different line.

> I reject the use of programming software as a loss leader.

Sorry, that was a bit of agitation for open-source :)

The argument still stands if you delete that clause from my post.

> An additional note: Our bestselling PLC programming and documentation
> software package costs $1100. If a one-time expense of $1100 is a
> problem for a plant, I can't imagine why I would want to call on it.

Certainly. It's just that if someone buys a $1100 package off you, how are you going to allocate that to the next 30 years?

More importantly, how will the clients know that you're allocating it to the next 30 years? If your competitor decides to skimp and only go for
25 years, they're going to beat you on price, and nobody will know until a quarter of a century down the track.

Jiri
--
Jiri Baum <jiri(AT)baum.com.au> http://www.csse.monash.edu.au/~jirib
MAT LinuxPLC project --- http://mat.sf.net --- Machine Automation Tools
 
I recently wrote a PO for over $700 to maintain support for our RSLogix500 and RSLogix5 software. The problem I have is that AB PLCs have been made the standard at the plant I work at, so this is what I am stuck with. As long as there is such a large base of AB PLCs that are installed out there, it will be difficult for the situation to change.

I just got a quote for a SLC5/05 processor. The $2300 price tag made my jaw drop........
 
Valid reasons are:

1) Economies of scale. Microsoft sell licenses in there millions, automation companies sell licenses in thousands, or less.
2) How is support payed for? You either charge a subscribtion or charge for all technical support calls, or do both. No charge, no support.
3) Software development costs are as high, if not higher than hardware development costs, yet the cost of hardware in real terms has reduced. Economies of scale apply here also. How many PC's are sold compared to the number of PLC's?
 
Based on your comments about the cost of AB's software, it apears to me that you have alot to learn. RSLogix 500 is very easy to use and has great features. Maybe you need to read the manual or attend a training class. to help you with the cost issue, You may ask you local AB distibutor for a quote on a MicroLogix 1000 Starter Kit. it should sell for about $360 and includes a copy of RSLogix 500 Starter, a MicroLogix controller, serial cable, input simulator, and manuals. With this kit you are getting the software for free. So, now that cost is not the problem, what else are you going to complain about.
 
Im sorry but supply and demand is one thing highway robbery is another. Although I agree selling millions of copies of windows tends to knock down the price, lets be realistic here we're dealing with a data file editor and a comm app. not an operating system. Let not forget also that new versions are rarely a clean sheet of paper they are additions and revisons. Why is AB forcing you to pay out your nose (for buggy software) in order to take adavantage of firmware upgrades? If this software such a burden for them to develop why arent PLC programming/communications standards made open by the manufactures for third party software houses to write for?

Sorry automation companies(besides Ge-Fanuc and some Schneider products), are making us pay for their inefficencies we cant quote our customer any price we want and neither can they.

Im
 
B

Bouchard, James

For the same reasons we pay for software tools and support to Microsoft and other vendors. We are constantly changing and developing programs on a variety of PLC's, Motion controllers etc. If you have a problem and do not have a support contract, then you do not get help, bug fixes upgrades etc. It would be nice to get it free but that is not the case with many suppliers. Replacing existing hardware and software with that of manufacturers that do not charge for their software would cost more than the fees we would save. And I am not even sure that it would be possible. If you want to have the latest and most capable software and hardware then you need
support. If you want to work with previous generation ones then you can probably get away with little support.

James Bouchard
 
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Donald Pittendrigh

Hi All

This issue comes up all the time, the answer is simple, do you think the software package, documentation, R&D on the software as well as the manuals even in electronic form are possible to make for free. Do you have some vision of an army of developers and translators not to mention publishers distributors etc. etc. all lining up for the greater cause of industrial automation...... FOR FREE????

If you know of a place where this Utopia exists, please let me know, I want to be there too.

Regards Donald P
 
Let us just compare a PLC with a PC. If you would have to pay for your hardware and then for your operating-system seperatly you won't be happy, because the prices for PC's would go into the 4ks.

Nobody is expecting to get hardware without the software for the price you have to pay for right now.
On the other side well established software firms will give you updates for bugs w/o any fees or just with a small admin. fee.

The behaviour of the PLC manufacturer is not to accept.

What would people say if the buy a new computer and the operating system is going to fail from time to time and they would just get the answer buy a new one???????
 
Free is not always better. Software that is sold is sold at a price to maintain the company and future developements. I do not mind paying a premium for the hardware or software if it functions as I was told it would. One thing we all have in common is money. If I dont make any, Im gone, if they dont make any, theyre gone. As far as free, how many of you that want free give away your products or services?
 
J
Free is not reality, you always pay in the long run. We sell very cost effective (better than saying cheap) PLC programming software for the Siemens S5 and S7 plc's with up-to-date English documentation. I maintain records of users, their product serial #'s, their PIN #'s, the version of software they are using, and provide technical assistance if needed. Any questions visit www.ttintl.com or e-mail me at [email protected].
 
S

Spanish Bandolero

Hi,

- New hardware features usually needs new software, and I think that point is easy to understand. moreover, PLCs like CLX offer amazing possibilities with newest software that you can use with 'OLD' hardware just updating its firmware, obviously you make the decision and you decide if you need/want these new features or you prefer to stay with the performance you bought some years ago.

- Why should I pay for NEW software? usually you don't have to pay the WHOLE new software, PLC companies offer you software support plans that at a lower cost maintains your software updating you with the latest versions. Once again you have the decision of taking profit of these newer versions or staying with your initial investment.

- Why use Logix (Windows based software) instead of APS (MS-DOS based software)?

1) Try Logix, you'll FEEL the diference...
2) Will Microsoft O.S. keep on supporting MS-DOS based programs in the future? will computer manufacturers keep on producing compatible hardware with MS-DOS (note that most of the newest laptops have completely replaced RS-232 serial ports with USB ports)... so will your computer last forever?

- Why pay for newest software? why we pay for newest PLCs? why did we put the first PLC in our plant? I think the answer is our competitors are producing better and faster, 'cause they invest, otherwise we would keep on working with rely logics.
 
You have to include the cost of the software into the project. Unfortunately there is no direct way around this.

But remember there are indirect ways to handle this so it works out for everyone involved. Negotiation. My company pays for very little of it’s required programming software. Usually the sales person has very little leeway to negotiate for hardware but they can fudge the price of the software without getting approval from higher up’s .

I know every one can not promise huge hardware purchases to their sales person on every purchase but you can look ahead to your needs for the next 1 to 3 years and use that as a negotiation tool. We make about 40 purchases a year from GE-Fanuc ranging from 20 to 60 thousand dollars each. With this level of purchases we get most of our software free.

5 years a go I did a 50 million dollar purchase from A-B. Part of the deal was that all required software would be free for development and the customer would purchase their own licenses after the plant was up and running. The reps from A-B basically gave us their entire RS suite and the key generator they used to make key disks under the stipulation that everything would be destroyed upon completion of the project. This worked out for everyone involved. We had close to 40 seats of the entire RS suit set up for the plant start up. Not counting the hardware for the programming seats, each seat was worth about 15 thousand dollars. I was un willing to purchase these seats and basically put it that way to A-B.
 
G

George Barraclough

I don't think we should pay for software after the prices we pay for hardware it should all be include in the price. If like me you use several diffrent PLC's like AB Rslogix, Modicon Proworx32, Mitsubishi Gppwin (now called GX Developer), it can get very expensive. The hardware is useless without a means of peogramming it so it should be free issue.

PS if you think RSlogix is bad you should try some of the others, most I have found are still using Dos or a windows version of the old dos program.
 
Your atitude towards a potential customer is apalling. I wonder if your tech support staff will treat me like that. The attitude that a customer should "get with the program" is not a good business strategy. This goes right along with gouging your customers by charging outrageous prices for software that could hardly be considered a high quality piece of programming.
I am just learning to program PLCs and I have never used your software or hardware, and your attitude has guaranteed that neither I nor any of my professional contacts buy your products. To stress this point, I am friends with the part owner of a large automation company here in PA. He is the reason I am learning PLC and motion control. His company has built projects for companies all over the united states.
 
M

Martin Fabian

The same problem pops up in other SW-areas. Joel Spolsky on joelonsoftware.com has a lot to say on this. For instance:
"All else being equal, demand for a product increases when the prices of its complements decrease." He makes a strong argument for this on http://www.joelonsoftware.com/articles/StrategyLetterV.html ending up with "Smart companies try to commoditize their products' complements." So, PLC manufacturers have to decide what are their products and what are the complements. As we can see from this current dicussion, PLC manufacturers and users do not agree. We users view the HW as the product and the programming environment as the complement. Manufacturers seem to be looking at things the other way aoround.

Other input into this, concerning getting users to switch brands. "The best way to eliminate people's objections to switching to your product is to make it easy to switch back. Nobody wants to switch to a product that is going to eliminate their freedom in the future." See http://www.joelonsoftware.com/articles/fog0000000052.html
 
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