Confessions of a TM Forum Live! Virgin

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James_B_Crawshaw 6/12/2017 | 5:10:19 PM

Re: Vendor selection Windstream shared their vendor selection criteria and weights in a presentation at TMF Live. Cost and terms was 15% of the total evaluation score. They described cost and terms as "Total cost of ownership including pricing, licensing and payment structures. The structure for agreements to perform services and pay for services rendered. Includes SLAs, KPIs, performance incentives and preferable terms and conditions."

So yes, payment structures is clearly an issue and operators understandably are reluctant to commit to volume based costs for software when they know there are no incremental costs to supply more instances of the same software – it is a 100% gross margin business. At the same time they don't want to pay a large up-front fee.

The middle ground is success-based pricing models for software where the operator pays something up front (to make it worth the vendor's time) with larger payments over time depending on how much the software is used.

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microcaptechinvestor 6/11/2017 | 2:00:24 AM

Vendor selection James, curious if the general theme for vendor selection was not only best-in-class tech, but also pricing based on functionality, not capacity. I'm an investor in this sector, and it appears like a big hang up is basically porting over technology and pricing models from legacy hardware approaches.

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