Cloud Computing Contract Periods – One Month Contract Period

Your Office Anywhere hosting contracts just one month!

Forbes on their blog web site here https://www.forbes.com/sites/joemckendrick/2013/01/14/9-questions-to-ask-before-signing-a-cloud-computing-contract/ state that “Vendor lock-in typically results in long-term initial contracts, the authors say.

“Some providers wanted early termination fees (which may be ‘huge’) if users terminated a fixed-term contract earlier for convenience, as recovery of fixed set-up costs were designed to be spread over the term.” Often, contracts require “notice of non-renewal within a set period before expiry,” causing users to miss the window to exit the arrangement, and a minimum of one or two years for the contract”

The reason for this is that the vendors don’t want to lose customers because of issues with the solution they are providing, so that the customer has to put up with the issues for the duration of the contract or negotiate their way out.  Most if not all companies tie customers into a minimum of a 12 month contract, which is more than a “punt” for the customer who may not know the hosting company very well, if at all.   What if their business model changes for example, or the solution doesn’t actually give them what they want, they are tied into a contract that isn’t actively helping their business.

Your Office Anywhere is different and the contract period is designed to be as flexible as the solution itself. The contract is effectively a month by month contract. How this works we describe below:-

  • Customer signs the SLA, T&C and Quote
  • In most cases no advanced payment is required
  • A build process is started by the sales team to the build team (maximum 5 days as each server is unique to each customer)
  • The server is provisioned and the customer starts using it
  • At the end of the month the server “goes live” an invoice is raised.   The invoice covers the month the server goes “live”, PLUS an advance rental for the following month.
  • At any point during the advance rental period, the customer can remove/disable users and if there are no users on the system at the end of this month NO invoice will be raised to the customer  so effectively users can immediately stop using the system at any point
  • Also the system will pick up additional users/removed users on the system and any applications made available to individual users/groups of users, so there is complete flexibility in terms of the customers’ requirements
  • Example – customer requests a build on the 7th May which is delivered on the 12th May, Invoice raised for users on the system on 31st May and an advance rental for June for the same amount. Customer pays by direct debit on or around the 11th June. At any point during the month of June all users can be disabled/deleted and no invoice will be raised if there are no active accounts at the end of June.

Why do we do this? We do this because we are SO confident in the solution and support we provide to our end users and the performance of the systems we deliver. We don’t want disgruntled users on our system who are not happy with the solution we offer so we work with them to find a solution and in the rare instances it doesn’t meet their requirements they can just close down the system with minimal outlay. In 99% of cases, customers actually add more applications and users to the system on a month by month basis.

At the time of writing this article we have in excess of 2500 remote desktop users (users connecting remotely to their own server) and more than 375 servers. We are currently in the top 5 of Microsoft Remote Desktop license providers in the UK.

Article by Michael Carter – Director at Cardium Outsourcing Ltd – Your Office Anywhere

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Categories: Contract Periods, General, Hosted Applications

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