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Maintenance and Support Agreements

Checklist

Fee Predictability

□ Price locked for a fixed term

□ After rate of price increases capped at CPI

Term

□ Minimum period of support

Termination and Resumption of Support

□ Ability to resume support after earlier expiration or termination specifications

□ Support obligations tied to “specifications” rather than “documentation”

Availability

□ Support available 24/7 if needed

Problem Escalation

□ Support escalation matrix

Service Levels

□ Escalation matrix response time service level

□ Service credits for service level failures

Limitations of Liability

Overview

Paid maintenance and support services provide protection following the warranty period. “Support” includes technical support services such as documentation, telephone help desk support, on-site support, and error correction/bug fixes when the software or service doesn’t work in accordance with the specifications. “Maintenance” would include the vendor’s obligations with respect to keeping the software or service current via updates, upgrades, enhancements, new releases, and the like. Hie following are some key considerations for any maintenance and support agreement.

In general, the vast majority of support and maintenance terms are written using aspirational language (e.g., “response time goal,” “targeted resolution time”), as opposed to firm contractual commitments to resolve issues within defined periods of time. As such, the support and maintenance terms are no substitute for well-drafted acceptance and warranty provisions.

Scope of Support and Maintenance

■ It is important that any agreement clearly describes the support that will be provided by identifying what software and services will be supported and the amount and type of support that will be provided. Before an agreement has been signed, companies should also inquire as to which support services are not included and will only be provided for an additional fee, so that such information can be factored into the negotiation process. Although vendors often argue that all of their clients receive the same maintenance and support, companies should not be afraid to insist on the level of support that is necessary to support their business needs during negotiations.

■ Requirements should be specified in detail for when and how updates can occur to avoid interference with the company’s use of the software or service.

■ Vendors should provide detailed documentation and make training available to customer’s personnel who will interact with the support software or service.

■ It has become common for vendors to limit the amount or type of support services included without additional charge. These arrangements can introduce significant uncertainty for companies regarding what fees they will be charged in the event of a problem with the software or service. This uncertainty can create a reluctance to utilize support services, which exacerbates the problem with the software or services and delays its resolution. The company should seek to reach an arrangement with the vendor where all support activities are included in a flat fee. While vendors typically resist requests for such “all included” provisions, this approach is often worth the extra effort during negotiations, especially for business-critical software or services where going without support and maintenance services is not a viable option.

■ If a vendor rejects an “all included” approach, companies must be certain that they understand the range of possible additional charges they may face over the life of the agreement so that they can factor those additional support costs into their vendor selection process. These arrangements are a lucrative source of revenue for vendors. By enabling them to charge for minimal support, and then charging extra for new releases, fixes to their defective product necessary technical support, reasonable response times, and on-site support to fix their defective products, vendors can deflate upfront costs in a way that makes it difficult to make comparisons with other vendors. Before entering into an agreement, a company should require the vendor to provide a detailed listing of all support services that are not included into the pricing structure.

■ However, most vendors will generally reject company requests to rewrite or expand the company’s definitions of bug fixes and updates, so they can avoid giving new versions or expanded functionality, and thus require additional fees.

 
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