Broadcom Lowers the Boom on CA Technologies Users
CA customers have been on a rough ride since the company was acquired by Broadcom in 2018 for $18B. Until then, they were accustomed to 10% renewal price increases, but now, they’re getting bludgeoned with increases ranging from 100% to 450%.
To raise awareness of these pricing tactics and help deal leaders prepare themselves, ClearEdge created the following checklist.
Check CA Contract Language Now is the time to see if you have any renewal language in place that protects you in an upcoming renewal. Prior to the Broadcom acquisition, CA did allow renewal cap language in a contract which provided protections in out years of an agreement. Since the acquisition took place in mid-2018, many customers now approaching the end of a three-year term may still have renewal caps in their contracts. This is the best defense in mitigating any large increase.
Assess Feasibility of Switching from CA Technologies Broadcom has enforced a non-negotiation approach regarding CA renewals. Even if you have additional product demand for new CA products, we have seen no flexibility from sales reps to provide concessions on existing maintenance and support. Consequently, the only option to mitigate future renewal increases is to remove all CA product and switch to a competing vendor like IBM or BMC. Switching completely off CA may not be feasible for some customers, so organizations should assess now what options they have and how long it would take to realistically make a move. ClearEdge recommends starting 18+ months in advance to successfully plan for your CA renewal to determine which products can be removed or shifted to a competitive solution.
Plan for the Next Multi-Year Deal One-year deals are no longer being offered by CA/Broadcom. As a result, CA customers are being forced into multi-year agreements. In addition to high renewal price increases, customers must be prepared for these long-term commitments. If you cannot accelerate a plan to move off CA, we recommend you use your next term to prepare for a successful switch to another solution.
For assistance with your CA Technologies renewal, contact your ClearEdge representative to discuss a deal assessment.
Corinne Boyles is a Senior Analyst at ClearEdge Partners.