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What are the costs to use OpenERP?

By
gunnar
on 3/28/13, 5:07 AM 9,240 views

hi, this is a little rhetoric question to

  • a) confirm that for myself before we are getting really into it
  • b) to create an entry here that other people can find whether they have the same question

I will answer it myself below as far my understanding goes and hopefully somebody who knows this exactly can either correct me or confirm.

6

gunnar

--gunnar--
1153
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Germany
--gunnar--

born

gunnar
On 3/28/13, 5:24 AM

OpenERP is free software. Free as in freedom & free as in gratis

No matter how many users or databases you want to deploy are or what you want to manage with OpenERP you will not (and will never) have to pay license fees to anybody for the sheer usage of the software including all publicly available Modules.

If you need any kind of professional support (what most people & organization will need) or hosting services at any point you can find whomever is capable of providing such services and pay them for these services they provide to you.

Such a service provider could be:

  • OpenERP SA
  • any of their partners
  • any other company or person of your choice

So, the use of the software is free of charge at any time. Whatever you pay it will be a service provided for this Software. And if you need a service or not is up to your own choice.

OpenERP weighs in on this in "Open Source: Free as in Freedom, not free as in Free services" at http://v6.openerp.com/node/465

Bista Solutions US, Ray Carnes
on 3/28/13, 7:15 PM

Statement: It will cost you a minimum of $ 15.000 to start or you have to invest this same amount or more in yourself or you are already a developer yourself by profession. See further one of the other answers.

ton123
on 3/28/13, 7:55 PM

@ Ray "Open Source: Free as in Freedom, not free as in Free services" good point. Actually that doesn't contradict what I stated, nut it is good to stress on that

gunnar
on 3/29/13, 1:41 AM

@ton "...minimum of $ 15.000" not sure whether you can generalize such a number really. I guess it depends very much on your approach, how much functionality you will be using, how many people you need to get trained, etc., etc ...

gunnar
on 3/29/13, 1:44 AM

You have to take care not to create false expectations. It has to be clear that "implementing OpenERP will always costs you something." The great thing with our full open source licence is that you can choose between spending time or money. So, it's not gratis, from the company point of view.

Fabien Pinckaers (fp)
on 3/29/13, 3:16 AM

I would change your question or answer as it's wrong. "what's the cost of the licence? --> gratis but "what's the cost to use" --> not gratis because time is money for companies. It's like thinking that because you get the car for free, you use it for free. NO, you have to pay for the gasoil (maintenance), the insurance (bugfix guarantee, migration), learning to drive (partner services). If people think it's gratis, they may face a bad surprise one day or another. (it's like calling the insurance when you car is already broken --> this will costs you much more)

Fabien Pinckaers (fp)
on 3/29/13, 3:33 AM
3

ton123

--ton123--
1418
| 5 6 9
Lisse, Netherlands
--ton123--
End-User. Installed 6.1.1 on a DS412+, DS211+ and DS113J Synology NAS. Reference installation on Ubuntu 12.04/Samsung Notebook. 12-03-2013 In production for Suppliers and Customers, adresbook. 7 small companies. Testing accounting, document management, import and export. Too much showstoppers I haven't fixed at this moment. 06-05-2013 little progress. Migration to v7 impossible because of missing Dutch localisation modules. What I see working is nice, so further testing and asking. Start testing products and warehouse. Happy with this forum and the community.
ton123
On 3/28/13, 8:57 AM

Nucleas Research did a TCO Case Study for 2 ERP systems for a biotechnology firm with 2600 employees comparing:

They calculated: JD Edwards Enterprise One on annual cost per user $ 1,250 SAP on annual cost per user $ 5,313

Some of my own calculations on the report:

Because OpenERP doesn't have licence cost I recalculated the above cost without licence cost and only including cost for staff and consulting:

  • JD Edwards annual cost per user not including licence cost $ 871
  • SAP annual cost per user not including licence cost $ 2,845

Project cost made for implementation of the system:

  • JD Edwards $ 17,000 per user
  • SAP R3 $ 34,000 per user

My first four conclusion based on these simple figures:

  1. Cost for licencees are relative very small compared with huge implementation costs and TCO on a per annual basis.
  2. It is smart from OpenERP SA to invest in OpenERP as opensource software. They can earn much more money in other areas like consulting around OpenERP software.
  3. A decision maker must have primary focus on bringing down the cost for implementation.
  4. Open ERP can beat competition when they bring down the cost for implementation and take care the decisionmakers are aware of this.

http://www.oracle.com/us/corporate/analystreports/enterprise-application/nucleus-sap-jde-162226.pdf

what would you say being the best way to actually bring down implementation costs? Gather knowledge by yourself as much as you can, finding a service provider with competitive pricing, or ...? Probably SaaS would be one way because you don't need to invest in Hardware. But some people might feel more comfortable to having their most crucial data close to their physical company and not in an anonymous datacenter

gunnar
on 3/29/13, 1:56 AM

@gunnar It is all about priority on good decisions in implementation. Hardware, SaaS and Service Provider doesn't really make the difference.

ton123
on 4/2/13, 9:19 AM
1

michel Guénard

--michel Guénard--
1033
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VIROFLAY, France
--michel Guénard--

VP operations & finance Social entrepreneur Certified Public Accountant Past Chief internal auditor

michel Guénard
On 3/28/13, 5:58 AM

This is referring to what is called Total Cost of Ownership TCO. It applies to IT domain. A lot has been written; see for instance (http://www.business-case-analysis.com/total-cost-of-ownership.html)]

not 100% clear whether that is a confirmation, a correction or an amendment to my answer. I think an amendment

gunnar
on 3/28/13, 6:07 AM

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Asked: 3/28/13, 5:07 AM
Seen: 9240 times
Last updated: 5/21/15, 2:21 PM