Why can't Sugar create a monthly plan?

[bribiz]

Can someone please explain to me why SugarCRM doesn't create a better bridge from open source to SugarPro? I think there are many small businesses using the open source version but can't upgrade to SugarPRO because of a policy decision that I believe is actually hurting SugarCRM's potential.

The policy decision to require purchasing 5 seats for $1800 upfront creates the following problems:
1) Disgruntled community. Small teams want the pro features and feel alienated by the policy. I believe more people would go PRO on a monthly option instead of just annual.
2) People need pro features to really be effective and this will cause people to keep looking at alternatives. vTiger, SalesForce and many others.
3) Bad PR. I researched the benefits of 6.0 and I read a couple articles and forum posts that seemed to indicate Sugar was changing their open source mindset.
This article led me to believe Sugar was withholding more key features from the Open Source version:

SugarCRM has said on its forum that the new SugarCRM 6 theme will only be available in the Professional and Enterprise editions of the product, not in the free Community Edition. It appear that SugarCRM is not releasing the source code for these changes, leading some to question the company's commitment to the open-source community. SugarCRM has been criticized in the past for abusing the term "open-source.

This forum post seemed to also indicate sugar community edition users think all the new stuff was really built into pro and open source was being almost abandoned in the future. Below is a couple selected quotes:
http://www.sugarcrm.com/forums/showthread.php?t=62699

There are no advantages to upgrade 5.0.0b to 6.0.0 - not really.
Sorry sugar folks...

There are a lot of advantages to upgrade from 5.0.0b to 5.5.4,
better performance, better handling of the studio, betterm handling of mass updates, better email handling, less bugs,...

What message is Sugar sending to the "community" with 6.0? These are intelligent people and it seems to me that they would not put out an upgrade with fewer "features" than the previous version for no reason at all. There must be a message in this somewhere!

Seems to me that they are signaling the end of the CE and that they are moving away from the open source model. I don't know what else to think based upon what you have posted.

I would buy a single-seat license if the yearly fee were reasonable, but at $350 USD with a 5 seat minimum, there is no way I can justify that for a one or two-person office.

I think that a lot of people may start looking at vtiger or some other alternative unless Sugar either 'upgrades' 6.0 or offers us a cost-effective way to buy Pro.

Luckily I read page 2 of the forum post that lead to a blog post that stated there were real benefits in 6.0 CE and Sugar is getting more serious about their commitment to open source. It also turns out that the theme confusion mentioned in the article was a technical reason and not a business model issue relating to why there's just one theme right now for open source.

I also learned that SugarCRM is really committed to open source. See this blog post here:
http://developers.sugarcrm.com/wordpress/2010/07/21/oscon-2010-and-open-source-tools/

They led a couple sessions at OSCON, opened up new tools, making source code available by SVN and much more indicate a lasting commitment to open source. I was very glad to find this information because I was really starting to give up on staying committed to Sugar long-term.

Why does sugar have this $1800 minimum purchase policy? Why does it have to be a single payment?
My guess is 2 basic reasons:
1) Support issues. I understand that with SugarPRO clients expect more support since that is part of the expectation. However, since client like me have been using the open source version, I don't need the support.
2) Billing issues. Many companies have adopted a monthly lease license. If you don't pay it, the software quits working. See kayako.com and whmcs.com as examples. Without the monthly lease, these platforms would not be so successful.

My proposed solution:
1) Sell a small team version that does not include support or limits the support. Salesforce has a 5-seat version for $125/month with far less features than SugarPro. They've also reduced their support. Personally, I would be willing to pay extra for support incidents if I was using a monthly leased license.

2) Encrypt the pro code. If Sugar is worried about the pro code getting out then encrypt it for the monthly lease clients. I know of other companies that do this. If I get the monthly leased license, I don't get the full source code.

3) Get a billing system that will turn off the license if I stop paying. Let's be real though. Sugar will run my business just like my billing software and my support software. I can't live without it. I have to pay the bill or I lose access to my data and I can't function.

How this will improve SugarCRM?
1) It will increase the adoption rate of SugarCRM. Free is good but only when it does everything you want. If it doesn't do the job you'll look for another solution.

2) More modules and less abandoned modules. Open source projects like Drupal and Wordpress have thousands of modules because of the large communities. Salesforce and Apple enjoy lots of apps because of commercialization of an app marketplace. People create modules, plugins and apps out of personal need or profits.

However, the number of modules/plugins/apps is in direct proportion to the number of users. I believe Sugar loses developers because there's a missing link between open source and SugarPRO.

For me I'm at a real decision point. I've been getting ready to launch a new product for the past 18 months. I'm now getting ready to roll it out and I will need a good CRM solution. I will need to go from a couple users to dozens and then hundreds.

However, the open source version lacks some key features I want. I'm going to download and test Sugar 6. I hope it turns out version 6 is a step forward and not backwards. I also hope Sugar creates a new bridge that enables small teams to get the Pro features on reasonable terms.

I'm going to need mail merge, reporting and a few other features in pro before I grow my team to dozens of users. I might be willing to commit to $150 a month and grow with Sugar. But $1800 immediately is quite a gap. As I grow, it's easier for me to add more reps if I can do it monthly. To add 10 more reps I need to pay $3600 before they even start. If there were a monthly option, I could add 10 reps for just an extra $300. Of course I have to keep paying it each month but the shareholders at Sugar would like to keep getting $300 from each month rather than nothing at all.

Salesforce has a reasonable options for small teams to get started. Once you start, it's hard to quit and switch. Why can't Sugar charge a monthly fee as I suggest and let clients grow their business with more powerful pro features?

[Angel]

Can someone please explain to me why SugarCRM doesn't create a better bridge from open source to SugarPro? I think there are many small businesses using the open source version but can't upgrade to SugarPRO because of a policy decision that I believe is actually hurting SugarCRM's potential.

The policy decision to require purchasing 5 seats for $1800 upfront creates the following problems:
1) Disgruntled community. Small teams want the pro features and feel alienated by the policy. I believe more people would go PRO on a monthly option instead of just annual.
2) People need pro features to really be effective and this will cause people to keep looking at alternatives. vTiger, SalesForce and many others.

Agree, to an extent. It is possible to get smaller user counts through a partner and there are many people successfully using CE as-is or in combination with community contributed enhancements or third party solutions. In the case of the latter, that combination is usually cheaper than even the cost of 1 Pro license.

3) Bad PR. I researched the benefits of 6.0 and I read a couple articles and forum posts that seemed to indicate Sugar was changing their open source mindset.
This article led me to believe Sugar was withholding more key features from the Open Source version:

The message being implied in these articles couldn't be any further from the truth. The facts are that Sugar has always offered 2 "paid for" versions of its product (Pro and Enterprise) and they both have always had more features than the Community Edition. This is true with 6.0 as well, hence, I have no idea what people are talking about when they try to insinuate that this is somehow news or that Sugar has changed its strategy in some way.

If anything, all this tells me is that the people writing those articles haven't taken the time to investigate the subject matter thoroughly. What if I find really ironic is that many of those articles focus heavily on how Sugar's strategy isn't "open source friendly," yet many of them conveniently forget to mention that the 6.0 version of CE adopted the AGPL license, which is even more open source friendly than the one being used by prior versions. If anything, I could more easily make the argument that Sugar is more directly aligning itself with the FSF people than I could that they are not.

Now, all that being said, I do fault Sugar for not more clearly stating their definition of "open source." Not long ago we had a discussion on this very point and I've also previously made it a personal matter to point this out. In my opinion, the definition is "the source is available to everyone," because it is. The problem introduced by not defining it is that people are left to their own resources to interpret what it is that Sugar means when they use the term. Of course, not everyone will agree. This whole "issue" is a great example of it.

Why does sugar have this $1800 minimum purchase policy? Why does it have to be a single payment?
My guess is 2 basic reasons:
1) Support issues. I understand that with SugarPRO clients expect more support since that is part of the expectation. However, since client like me have been using the open source version, I don't need the support.
2) Billing issues. Many companies have adopted a monthly lease license. If you don't pay it, the software quits working. See kayako.com and whmcs.com as examples. Without the monthly lease, these platforms would not be so successful.

I concur with #1. There is a cost to Sugar to be able to provide that service and while some portion of the user base may feel they'd be fine without support, I think it would cause another PR situation not unlike this "issue" with its "openness" in regards to 6.0. I can already see the headlines of articles lambasting Sugar for offering a paid for product without any support.

Competitors would have a field day with all the confusion that would cause although the truth would be that it is a customer option and not a general policy per se, much like the issue with CE vs PRO/ENT.

How this will improve SugarCRM?
1) It will increase the adoption rate of SugarCRM. Free is good but only when it does everything you want. If it doesn't do the job you'll look for another solution.

2) More modules and less abandoned modules. Open source projects like Drupal and Wordpress have thousands of modules because of the large communities. Salesforce and Apple enjoy lots of apps because of commercialization of an app marketplace. People create modules, plugins and apps out of personal need or profits.

However, the number of modules/plugins/apps is in direct proportion to the number of users. I believe Sugar loses developers because there's a missing link between open source and SugarPRO.

Regarding #1, I understand the point, but I have a hard time understanding why it is that people think it is OK for them to receive a free tool that helps them make money, but it is not OK for the manufacturer of that same tool to in turn make money.

Not a personal thing, but that attitude of entitlement bothers me. I see no reason why Sugar should be required to provide everything for free and in turn limit their own earning power.

If we were to talk to an attorney and suggest to them that all of their work should be pro-bono, we'd likely be laughed at.

Anyway, as for #2, fellow community member Roblaus had suggested a similar marketplace idea, which I also like. However, due to the open source licenses Sugar has adopted (partly in response to pressure from open source purists), the environment that has been created is one that isn't conducive to that type of development. Again, I am referring to the AGPL and GPL.

I won't get into it again, as we (community) had a long discussion on this already, but check out this thread if you are interested in hearing the differing opinions on that matter: http://www.sugarcrm.com/forums/showthread.php?t=27882

[bribiz]

I installed version 6 and now I know why people feel like it's a downgrade. I too will have to stick with 5.5 for now. It's too bad because I wanted the new pop-up support and list targeting features as well as a better UI.

I won't get into it again, as we (community) had a long discussion on this already, but check out this thread if you are interested in hearing the differing opinions on that matter: http://www.sugarcrm.com/forums/showthread.php?t=27882
Yesterday 09:19 PM

Thanks for the link to AGPL thread. I'm a fan of open source and I have no problems with paying for software as open source doesn't = free like some people think. I'm actually more concerned about projects that don't find some form of commercialization.

I've always liked Sugar's forward thinking trying to strike the right balance. However, I'm concerned there's a growing gap between free and paid that will cause less people to use Sugar in the future. The evidence is there with the reaction I'm seeing to 6.0 and now experienced myself.

I'm fine with Pro always having extra features. I want to pay for them too. Just make it easier for the masses to go from free to paid so people don't skip the free version because it's deemed inferior. Perhaps it's just the interface in version 6 but it seems to be a downgrade and has people confused about the future.

[Angel]

I've always liked Sugar's forward thinking trying to strike the right balance. However, I'm concerned there's a growing gap between free and paid that will cause less people to use Sugar in the future. The evidence is there with the reaction I'm seeing to 6.0 and now experienced myself.

Personally, I think adopting GPL and now AGPL is much more harmful. Within some months, all the noise over the UI not being in CE will die down. More so if someone in the community makes a similar UI available for CE. Roblaus is already working on this.

Point being, in the grand scheme of things, these are minor issues and in the end, they can be resolved. The GPL/AGPL issue isn't. Its reach is far deeper and frankly, poses many more issues and like I said before, part of the reason why it is that way is to appease open source purists.

Whlie I am a fan of open source and have advocated its use for many years, sometimes this narrow minded view some of those purists share causes much bigger problems. I've seen at least 3 different attempts at open source CRM packages over the last 10 years. They all failed because they were more focused on being open than on being a CRM solution.

I give Sugar a lot of credit for recognizing that delicate balance and succeeding.