This message was posted on Thu, 26 May 1994 16:03:23 -0400 by Jim Conklin on behalf of Ken King, CREN's Executive Director. The message was sent to the LSTSRV-L list, a forum for the discussion of L-Soft products. Most of the people subscribing to this list are LISTSERV administrators, ie people in charge of making purchase recommendations for L-Soft products. This message was not an emotional, late-night reaction to some L-Soft announcement: no announcement had been posted on that day, nor is this message in reply to any recent discussion held on the LSTSRV-L list, and, above all, the message was posted by Jim Conklin on behalf of Ken King. This means at least two individuals were involved, and the resulting message is by no means a spur-of-the-moment incident. For better or for worse, it carries the full weight of the organization. The message is being quoted in its entirety, with interspersed comments. Because of the threat to the NJE network in point 4, I am copying this message to the NODMGT-L and TECHREP lists. > One of the goals of the CREN software acquisition effort is to >protect its members from the rampant greed of monopolists. For those >considering doing business with a company that operates in the style of >L-Soft, the following advice may be helpful. L-Soft does not intend to reply to such statements in kind. L-Soft's style, for better or for worse, is to answer deprecating statements with hard facts, products, and prices. Besides which, the fact that a respectable, non-profit organization of higher education is driven to such verbal extremes in the face of a company 1/10th of its size says a lot more about the state of affairs in CREN than I possibly could with 1000 lines of carefully laid prose. >1. Look at Schedule "C" of the CREN/L-Soft Agreement. That schedule >states the prices L-Soft was proposing to charge CREN members before the >Listproc acquisition was announced. At that point in time, the CREN >transition plan from NJE to IP was presumably hostage to an IP version >of LISTSERV. Schedule C is a price guarantee, not a price list. CREN demanded a 19-month guarantee on the maximal prices for certain L-Soft services as a pre-requisite for signing the CREN/L-Soft agreement. We provided that guarantee by documenting our list prices - the corporate ones, as some of CREN's members are for-profit organizations. CREN did not raise any objection as to the dollar amounts, in spite of the fact that these prices were higher than the package rates we had at that time. And it is only natural that CREN did not object, as the everyday laws of business dictate the use of package offers, introductory rates for new products, and other promotional offers which are obviously more advantageous than list prices. >2. Be wary of prices to be set later when they have "more experience". >For example, if a maintenance price is to be set later, and you're >committed at that time, you may be subject to the rules described in >item number 1. There is no need not worry about that. The maintenance prices for the unix version of LISTSERV will be announced and guaranteed for 12 months when the product is released, as we have now gathered the necessary information on the respective market shares of the various unixes, and procured development facilities for the most popular ones. Purchasing officers are not stupid, and ask such questions as a matter of routine. >3. Get a complete definition of what a perpetual license means that >distinguishes between a new release and a new product. For example, >remember LISTSERV VM-TCP/IP is a new product requiring a new license, >not an upgrade from LISTSERV VM-NJE. The said perpetual licenses were granted, free of charge, to 150-odd CREN members, in some cases as early as 1986 (note that these licenses were granted by Eric Thomas, not L-Soft international Inc.) For 7 years, the software remained available for free, and new versions were regularly issued at no charge. Last summer, Eric Thomas decided to found a company to offer a more professional (and entirely optional) service to the existing LISTSERV users, and to use the proceeds to develop major improvements, such as LISTSERV-TCP/IP and the VMS and unix versions of LISTSERV. These products are now being sold by L-Soft international Inc., and indeed they are not available as a free license upgrade. None of our customers so far appeared the least surprised when we informed them that there would be something to pay. CREN appears to be alone in the belief that LISTSERV-TCP/IP, developed at a significant manpower cost to L-Soft, should be a free upgrade to LISTSERV-NJE. Similarly, Anastasios Kotsikonas granted a number of free ListProc licenses over the past few years. In March, CREN purchased the rights to ListProc, and has since then been funding its continued development. CREN's public message, "Pricing of CREN's ListProcessor software", makes it clear that CREN intends to require new licenses for the use of this new version. That is, CREN decided to make ListProc version 7.0 a new product, and the users of version 6.0 will be required to obtain a new license. If this is appropriate behaviour for a non-profit networking organization, surely it must also be legitimate for a software vendor. >4. Remember that dropping CREN membership will result in your removal >from the BITNET routing tables. This statement is an excellent illustration of the risks CREN alluded to in its introduction. This threat is only effective because CREN holds, for the time being, a de facto monopoly on NJE connectivity in the US. If your business depends on NJE, you have no choice but to pay the price CREN sets, or be disconnected. Thankfully, L-Soft has developed, over the last few months, new products and services to provide a smooth, non-disruptive migration path from NJE to TCP/IP (and then from VM to either VMS or unix). Many former CREN members found it more advantageous to purchase a LISTSERV-TCP/IP license from L-Soft, at a one-time cost on the same order as their yearly CREN membership dues, than to continue their CREN membership. Undoubtedly, CREN's public statement will only serve to convince more CREN members of the merits of this course of action. There are, however, many L-Soft customers who still rely on NJE for their business, and for whom LISTSERV-TCP/IP is simply not an option. More importantly, a very large proportion of L-Soft's customers indicated that, while they could abandon NJE if it became really necessary, they would rather keep the service if at all possible. Many explained that, unfortunately, their management was no longer willing to pay CREN membership dues of up to $8000 yearly just for NJE. Because it is these customers' desire to continue with NJE and because NJE facilitates the use of certain LISTSERV functions, and in particular the file server functions, L-Soft would be very interested in providing affordable NJE access to these customers. L-Soft's estimate is that the actual per-node cost of managing the worldwide NJE network is on the order of $50-70/year (fifty to seventy dollars), including overhead. At these rates, L-Soft would be able to bundle free NJE access with each maintenance contract for LISTSERV-NJE. This in turn would make it a lot easier for many L-Soft customers to get management approval for the continued use of NJE, as they would no longer need to justify NJE access as a separate item. And, of course, L-Soft would agree in writing and in perpetuity to allow other companies to compete for the provision of NJE access. L-Soft does not see NJE as a revenue-generating venture, but as a useful side addition to L-Soft's offerings - one that would allow us to offer one-stop shopping to our "traditional" mainframe/NJE customers. This, unfortunately, is not possible today, because of CREN's monopoly. A monopoly that, judging from the statement quoted above, CREN is unlikely to open up before the July 1st deadline. >5. In the next few weeks there may be some CREN announcements that will >help you get an even better deal. Watch BITNEWS. In the next few days, L-Soft will (not "may") publish announcements that will provide an affordable alternative to current ListProc users who, not being CREN members, do not benefit from our "75% membership" package. This, along with CREN's price list for ListProc, which offers licenses to non-CREN members at a rate that is usually much lower than the corresponding yearly CREN membership dues, will indeed help the academic market get an "even better deal". Eric Thomas Manager of Design & Development L-Soft international, Inc.