"Often, companies don’t believe in using a product unless they have to pay for it, usually a lot."

by TrevorJ • 18 years ago

9 6 18 years ago

lnguyen• 18 years ago

For enterprises, the license cost of a product is a small part of the equation. Maintenance and support (billed annually) is really what they're interested in.

And don't forget that the more that someone's paid for something, the more willing they are to scream bloody murder until whatever issue (they think) they're having is fixed.

pchristensen• 18 years ago

Also, training users is expensive. Integrating with existing systems is expensive. The price of failure (in opportunity cost) is high enough that most big companies would rather pay 10x for something that WILL work than for something that might work.

LPTS• 18 years ago

In a similar vein, placebos work better when they are more expensive.

dazzawazza• 18 years ago

I've worked with this before. At a previous startup I was the only startup member that had deployed a significant web application. I had always used the FreeBSD platform. We deployed on Windows Server 2003 because despite my personal experience and the ability to pay for FreeBSD support the powers that be were nervous. At the end of the day 'you don't get fired for buying Microsoft' won the day.

As you can see, this wasn't a healthy startup environment to be in where fear wins over experience.

startingup• 18 years ago

This is not as irrational as it sounds. In our own personal lives, we make decisions like this. As an example, I haven't in recent memory visited a ultra-cheap ethnic restaurant (though I go to more expensive places), because I am worried about their health standards. I am using price as a signal of quality - which is reasonable in a perfectly competitive market, but alas, if a lot of people act like me, the "perfectly competitive market" assumption may not hold. In other words, this "price signals quality" thesis itself depends on people evaluating quality first, and then the market sorts itself out based on quality. But if people start acting en masse on the price-signals-quality assumption, it stops signaling quality.

So this is a perpetual tension (or a perpetual self-referential loop!) that means there are going to be overlooked bargains in the market. In case of restaurants, I am just not that motivated to find them.

I can imagine enterprises feeling that way about IT.

TrevorJ• 18 years ago

I think the biggest dichotomy in outlook occurs when you finally discover or stumble on a tool of great quality which is also either free, or a very good bargain. After that point it becomes worth it, on a personal level to invest time into finding more of those gems. You become a believer in what I like to call the "hidden gems" -a less obvious, and often more elegant solution to a problem. (Be it software, or a life choice, or anything.)

"Often, companies don’t believe in using a product unless they have to pay for it, usually a lot."

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