Late to the party? The rise and rise of third-party support

Against the backdrop of the pandemic, while many industries struggled and the UK economy suffered its biggest slump on record, the third-party support market was staging a quiet revolution. At Spinnaker Support, which provides services for Oracle and SAP users, sales and headcount have doubled over the past year and customers are choosing to move away from vendor support on a daily basis. So why is this? Martin Biggs gives his perspective.
Against the backdrop of the pandemic, while many industries struggled and the UK economy suffered its biggest slump on record, the third-party support market was staging a quiet revolution. At Spinnaker Support, which provides services for Oracle and SAP users, sales and headcount have doubled over the past year and customers are choosing to move away from vendor support on a daily basis. So why is this? Martin Biggs gives his perspective.

As the Vice President and General Manager for Spinnaker Support in EMEA, I’m clearly not a neutral observer in the third-party software support debate! However, having been immersed in the industry for several years, I do believe I can provide real insight into what lies behind the recent shift in the market.

Independent evidence of the growth of third-party software support isn’t hard to find – research from Gartner suggests that the market will have tripled by 2023. This is backed up by regular reports of high-profile customers choosing to move away from vendor support, including high-street banks, major government departments, manufacturing organisations, retailers, telecoms and transport providers.

So why is third-party software support such a growing tech trend?

Scope for growth

It is important to acknowledge that a contributory factor to the rapid growth of third-party support is that it currently holds such a small market share. In the region I oversee – Europe, the Middle East and Africa (EMEA) – the vast majority of database users still pay their software provider for support services. Often, these organisations simply don’t know that third-party support is an option.

For many years, vendor support was the only viable alternative, and some customers still like the security of knowing the company that produced their software has their back. For a maintenance fee, they have the reassurance that they will be provided with bug fixes, patches and updates. They believe they will have access to expert advice from the software’s source.

This is entirely understandable – many of us have a natural tendency to play it safe and stick with what we know. There’s no doubt that software companies have capitalised on this over the years, encouraging customers to believe there is no secure alternative to their own support services. Vendor lock-in – through the migration of systems to a provider’s ecosystem and the tightening of contract terms – can make moving on logistically challenging, as well as nerve-wracking.

This all adds up to a good case for inertia! So what is it about third-party support that is finally prompting organisations around the world to cut the vendor apron strings?

Savings and service

The two most obvious advantages to third-party software support are reduced cost and improved service.

By making the move from vendor support, customers can save over 60% on their annual maintenance fees. This year alone, our newest customers have collectively saved tens of millions of pounds in annual maintenance costs. Saving money on a recurring cost like this provides a welcome boost to reserves, freeing up funds for transformation projects and investment in people.

It is important to emphasise that these cost savings are not at the expense of service. Because third-party support providers are solely focused on support, maintenance fees are reinvested in improving service quality, rather than developing new products. As a result, we have the resources to provide customers with their own dedicated team of engineers, many of whom have moved across from Oracle or SAP. They’re expert, get to know customers and their technology stack, and are on hand to solve problems with tailored solutions. There’s a reason that Spinnaker Support’s customer rating on the independent Gartner Peer Insights site stands at 4.9 out of 5!

System security

Less obvious is the impact of moving to third-party support on system security. This is often the stumbling block for potential customers – they feel it’s simply too risky to put the security of their system in the hands of anyone but the software provider.

The reality is that with third-party support, system security is not only assured, but even improved. Security solutions from the provider – such as Oracle’s patches and SAP’s bug fixes – are one-size-fits-all or only apply to core functionality. By contrast, third-party support providers offer solutions and fixes that are tailored specifically to an individual customer’s software and the challenges they want to overcome. For example, for Oracle customers, our engineers target specific security vulnerabilities that impact them, whereas Oracle’s own patches attempt to address multiple, often irrelevant, issues at the same time. For SAP, we provide fixes for customisations and interfaces, as well as the core.

Vendor lock-in

Last, and probably most interestingly in my view, are the benefits to be gained from escaping vendor lock-in. For a growing number of our customers, this is the make-or-break factor that finally convinces them to move away from their software provider’s support services.

The ever-tightening grip of software vendors, in particular through the creation of ‘walled garden’ environments that tie customers into a range of products and services, is a major concern. There’s a constant push towards the next big innovation – an upgrade, a new platform, a Cloud-based solution… After all, it’s by selling new products that software companies maintain their revenue streams and profitability.

In reality, these innovations are often solving problems that will not be an issue for most customers until the next decade! Yet businesses still feel under pressure to upgrade, even if they are running perfectly well on existing technology. As many have found, this can prove dangerous and expensive in terms of disruption, risk and cost. If existing solutions work, are secure and familiar, it is pointless to upgrade for upgrade’s sake.

This is where third-party support providers come in. By breaking away from the big software players, organisations are able to retain their existing solutions, knowing that these will always be fully supported. They are then free to shop around for ways to supplement these, for example in the open-source market.

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In keeping with the current zeitgeist of the right to repair and preventing planned obsolescence, third-party software support certainly feels like the solution for our times.

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Amber Donovan-Stevens

Amber is a Content Editor at Top Business Tech

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