BI and analytics software packaging and pricing are a Wild West with few common practices among the vendors. Comparing and contrasting vendor prices and negotiating with vendors is challenging because

Few vendors publish list prices, so when a vendor tells you you are getting a certain discount you can’t really verify whether the discount numbers are valid or not.
Vendors base their prices on multiple variables such as:

  • Total number of users
  • Concurrent users
  • User types
  • Connectivity to certain types of data sources
  • Number of CPU cores or sockets
  • CPU clock speed
  • Amount of RAM
  • Server Operating System (OS)
  • Environments such as development, test, QA (quality assurance), UAT (user acceptance testing), production, and DR (disaster recovery)

So how do you know if you are getting a good deal? Here’s a best practice and a few price ranges you can use to get you started. First of all, at the end of the day, it’s the number of users and user types that are always a common denominator regardless of BI software platform or your particular implementation. Consider the following price ranges for specific user types:

  • Static report viewers - PDFs, etc - $0-$50 per seat
  • Interactive report viewing (sorting, filtering) $500-$1,000 per seat
  • Advanced interactive report viewing (pivoting, ranking, slicing/dicing) $1,000-$2,000 per seat
  • Power users, report authoring $2,000-$2,500 per seat
  • Data scientists, predictive/advanced analytics users $5,000-$10,000 per seat
  • Developers/Administrators $2,500-$5,000 per seat

Next, do some math to figure out a ball park number that fits your BI project particulars. Then start your negotiations based on the following discounts:

  • 10%-50% discount if your deal is in low 6 digits
  • 50-70% discount if your deal is in high 6 digits
  • 70+ discount if your deal is in 7 digits

Last, but not least, IMHO, BI vendors should not charge for more than a single environment, so dev/test/QA/DR should be included in all BI deals since that's part and parcel of how all enterprise software is deployed and used.
Looking forward to everyone's comments if the ranges you see here relate to your field experience with BI software prices.

Originally published by Forrester Research. Click here to read other comments posted.

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