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What Is the ‘Software Tax’ and How Is It Affecting Budgets?
The survey found 95% of respondents paid for upgrades they expected to worsen outcomes, while senior engineers spent time on mandated changes.
- On Tuesday, a report by Origina revealed that large British companies spend 28% of their software budgets on vendor-driven upgrades, migrations, and licensing changes they would not have actively chosen.
- Origina CEO Tomas O'Leary noted that "saying yes is often a rational response" when the alternative is losing system support; 80% of companies fear leaving a major vendor would disrupt business operations.
- Senior engineering staff frequently divert time to vendor-mandated changes rather than innovation work, while 91% of companies retired fully functional hardware in the past three years to comply with support deadlines.
- Liberty Mutual CIO James McGlennon described these recurring costs as a "software tax," explaining that "every year it repeats is a year those people aren't working on the initiatives that actually differentiate the business."
- Nearly 82% of respondents support software support obligations similar to EU hardware repairability standards, signaling demand for legislation to protect enterprise customers from restrictive vendor mandates.
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Enterprise Software Costs Threaten AI Investment, Innovation as Firms Spend 28% of Budgets on Unwanted Changes: Report
Get latest articles and stories on Business at LatestLY. Large enterprises may face growing constraints on innovation and artificial intelligence (AI) investments as vendor-driven software upgrades, migrations and licensing changes consume an average of 28 per cent of their software budgets, according to a report by Origina published in collaboration with Thinkers50. Business News | Enterprise Software Costs Threaten AI Investment, Innovation as…
·Mumbai, India
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Total News Sources13
Leaning Left0Leaning Right3Center4Last UpdatedBias Distribution57% Center
Bias Distribution
- 57% of the sources are Center
57% Center
C 57%
R 43%
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