Re: PRESS: Informix in the News -- 11/25/96

First one key issue in the whole pricing philosphy of Informix. For corporate customers of Informix the situation is reasonably simple. They buy the engine from Informix and whatever datablades they might need possibly from third parties. They simply evaluate their ROI to make the buying desition. For independent software developers it's more complex. They sell an application to the end users. They have to buy an engine from Informix, possibly extra datablades from Informix or someone else. Their equation goes like this: Gross profit = Sales price - Db price - Datablade price There may easily be too little money to go arround to Informix for the Db price, the datablade developers and the ISV. This may easily diminish the market for datablade developers. The ISV's may not be able to get the profit they need. Informix suffers. Informix may win big by going for volume rather than high prices. There may be ways to do both as stated below: nnob@loc.gov (Nick Nobbe) wrote: :> usergrp@informix.com (Christine Shannon) wrote: ::Informix plans to charge customers approximately $2,500 per ::user -- as much as $1,000 per user more than they now pay to use Informix's :On Wed, 4 Dec 1996, Nils Myklebust wrote: :> And there goes the universal availability and usefullness of this :> fantastic product. :> If Informix realy wanted to dominate the database market and become :> the one unchallenged leader they would charge less for their product. :> :> I can understand the temptation to charge a high price for this, but :> the great american tradition has been to earn money on volume. That :> may become hard at these prices. :> :> When we considder that virtually every user of databases need the :> functionallity of the Universal server, there is a huge volume market :> out there to be tapped. :> :> I hope Informix will think about this, but obviously whish them every :> luck whatever they do. : Nils et you al, : The stakes have gone up. Let me guess the reasons: : : 1. it's what the market will bear, based on comparisons with other : competing but inferior products. To join the game, you'll have : to ante up. To allways charge what the market will bear is one of the most dangerous policies there are. When the competitors do come out with competing products at substantially lower prices, the one that has charged high prices before may be feared for wanting to milk you. Lowering the prices at that time may be to late due to this fear. : 2. the captive audience/upgrade your software factor. Just to stay in : the game, you'll have to raise (to continue with the poker analogy). : Entre parentheses, Informix does offer good support for the full : product line, so you can stick with your Online 5.0, SE, etc. I don't understand the first part here. The problem with the last part is that I can't stick with Online 5.x, SE or even OnLine 7.x. They are better than the alternatives right now, but doesn't have that much of a lead. We (and everybody else - even those who haven't quite relised it yet) realy need a lot of new functionallity. I do not excpect Informix to put much new functionallity into their old products. No extended SPL, new datatypes or anything else realy significant. I even hope they will not as I believe they would then extend themselves too thinly in their developement resources. They need to use these resources extensively for other purposes. In a few years even the Universal Server will not be that special in the marketplace. : 3. the big player syndrome. All the value added features are especially : attractive to the major corporations. Wrong - it's at least as attractive to smaller players - of which there are very significant numbers. Granted it will take longer to develop this market. : It's not penny ante any more. : Why else were the first releases directed to the Sun and HP platforms : (or was it NT?) I agree with your assertion about volume versus high : cost, thought there could be a middle road like tiered pricing based : on number of users. Yes, yes, yes. There could be a middle road. Informix might take this and make the good things available and usefull for the entire marketpalace. The tiered pricing may also be based on CPU's or other diferentiating factors (like the OnLine Workgroup products versus the full onse). If they stick with the big customers only for too long they will be in trouble. : Though can't say that I blame Informix for targeting : their "special" clientele. Well, if this is in the very short run only, it's of course ok. This *is* the market that Informix will have to cover first to regain their costs (aquisitions and development) as fast as possible. They do however have to start thinking longer range very fast as well. : 4. no true substitutes on the market yet. The other players have been : caught by the latest Informix ambush. Some have just begun to think : about it; others have thought about it, but can't offer a competitive : substitute. At this point, it looks like Informix has taken the lead : in innovation. Will they win the ambush, and lose the war? Time will : tell. Sybase doesn't have anything, nor Microsoft - yet. I doubt the whole philosophy of Oracle, and how they intend to extend their database (with worts and bandaids according to Stonebreaker). But: have you checked out DB2 from IBM. The newest versions *may* actually be interesting. : : Yours, : Nick : ********************************* : Nick Nobbe, Library of Congress : NLS/BPH : mail: nnob@loc.gov : ********************************* Nils.Myklebust@idg.no NM Data AS, P.O.Box 9090 Gronland, N-0133 Oslo, Norway My opinions are those of my company The Informix FAQ is at http://www.iiug.org