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January 20, 2016

Pricing, Value, and Emulating Classics

Value-PriceEditor's Note: Yesterday we ran a story about the impact of proprietary software lock-in, as reported from a manager's office where HP 3000s still do their work. Amid that story was a quote about predaceous pricing (love that word), the act of outre increases to the cost of emulator MPE server solutions because of upgrade charges. It's blocked several adoptions of Charon HPA, even among managers who love the ideal of non-HP hardware that keeps MPE apps alive. Tim O'Neill wrote the following editorial, prompted by our article. Although companies do need to generate capital to keep supplying software, the matter of how much to charge for a shift to an emulator remains a flash point.

Editorial by Tim O'Neill

James Byrne brings up important point about proprietary software running proprietary hardware: it enabled predatory pricing, both by HP and by third parties.  

At this stage, it appears that Charon could be bought affordably, but the problem is the third parties' still seeing the opportunity to gouge existing customers.  

This is why businesses become former customers and change to shareware and open source operating systems and databases, e.g. Linux and open database systems like Postgres. There are still costs as a part of such a change. They might need to hire more in-house staff to do what HP and third parties used to do for that one huge cover-all price. It might not be wise to entrust critical applications to shareware, but are customers avoiding doing so?

So the huge predatory prices were not without value. This is not to say I defend them.

That said, it is still shameful that at this point, third parties are unwilling to honor their customers' long history of loyalty, by requiring emulator relicensing. These third parties should realize that they might realize longer-term benefit by keeping their customers, not driving them away.

It would be interesting to compute the price and valuation of HP stock since the point just before they announced the death of its MPE business, through the split in 2014. One might be able to say that the company's value has fallen without MPE. It may fall further when OpenVMS is eliminated and when HP-UX is not marketed, not enhanced, not written for any CPU other than HP's own Itanium, and not licensed at prices that are fair to customers.

05:15 PM in Homesteading, Newsmakers | Permalink

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