In today’s technologically advanced world, no industry can think of running their businesses without software. Whether the piece of software is customized, or open-source, it is a vital tool for all systems in an organization.
It is usually easy to understand why hardware is expensive, as it includes material costs, labour charges, and installation and maintenance charges. However, the same is not exactly justified when it comes to software. You might have, at some point, wondered why some software is so expensive when the cost of creating it is next to nothing.
Let us understand a little more about how the cost of creating software is accumulated.
How is the high cost of software justified?
Did you know that 'Unreal Engine' - a highly advanced real-time 3-D creation tool - is claimed to be the most expensive software? Source
It is not used by individuals, but rather by gaming companies, and costs over $750,000. This piece of software is complex and has advanced features. However, the question still arises - why is it so expensive?
Here are four major aspects that contribute to the high prices of software -
Software development is expensive
Contrary to popular belief, software is more expensive to produce than hardware. A major factor in that is the labor cost. While there are no material expenses in creating a piece of software for business, it actually takes software developers hours of hard work to develop a single program on the software.
The development cost is directly proportional to the skill of the workforce. Besides that, there is the added expense of housing thousands of developers in a workplace, and providing them with the required utilities and tools to maintain work efficiency. The software required for software development is also expensive. All these costs are included in the initial cost of purchasing the software.
Software is not a one-time-creation
Once a piece of software is released, the company’s responsibility does not end there. There are several support and maintenance tasks to be performed on the software, in response to the errors that may occur at any point of time. To provide this support, many software companies have opened 24*7 call-centers, in-person technicians, and even live chat rooms. These support services also add to the cost of software.
Software requires timely updates
Apart from maintenance and support, software needs to be updated regularly in order to keep up with new features. Version updates including security fixes, updated functions, and optimizations need to be sent out at periodic intervals to maintain the overall functionality of the software.
When you purchase a software license, the cost of updates is generally covered in the initial cost.
There is a hosting fee involved
Today, software companies are hosting their products over the cloud. These cloud-based software solutions take up a large number of resources that we aren’t even aware of. These resources include servers and cloud services.
Maintaining a website on the cloud, and allowing software downloads (including free downloads), can cost the company quite a lot. The expense of using these resources is significantly high, and can not be covered by the software-solution company alone. Hence, a fraction of these charges is also added to the preliminary price of purchase..
A cost-effective alternative - software rentals
There are several other factors, apart from the four mentioned above, that contribute towards the high cost of software. It is a known fact that purchasing IT equipment, or software for business, is a costly affair, and requires a significant amount of consideration. We can safely conclude that purchasing software for business use can turn out to be quite expensive. However, there is a cost-effective alternative.
You can always choose to rent software for the systems in your organization. Trusted, experienced, and authentic rental companies, like Rank Computers, provide genuine, licensed software rentals, and also offer maintenance and 24*7 support services - at a justified rate.
Software rentals not only allow easy scalability of your workplace, but also ensure that your expenditure is minimized significantly. Renting software for business is a great way to promote effective operations in your systems. Learn more about the advantages of software rentals.
