The Client
One of the largest providers of life insurance in America.
Challenge
The client uses CA software to maintain security, reduce risk and improve compliance in their mainframe environment. As part of the client’s projected needs in this area, CA prepared an unsolicited proposal for a large quantity of licenses with an attractive volume discount based on the client acquiring and paying for all of the software today. This initial proposal was rejected by the customer’s finance department due to insufficient operating budget available to support the upfront transaction. A subsequent financing proposal (3 equal annual payments at 0%) was also rejected as this did not solve the financial impact of depreciation of the licenses to their operating budget. At this point the deal stalled and it did not appear that the client or CA would be able to complete the transaction.
Solution
Central was brought in to help re-structure the proposal to allow the customer to move forward with the deal. Central structured the transaction using SoftwareCENTRAL, in a way that allowed the client to commit to purchasing all of the proposed software licenses immediately, but take delivery of the licenses over the next 3 years as they were needed. By transferring the licenses over time, Central was able to match the amortization and maintenance costs against the client’s available operating budget which allowed them to commit to the larger purchase today.
Benefits
Using SoftwareCENTRAL, the client was able to take advantage of attractive pricing on the larger quantity of software licenses today without the negative impact to their current and future operating budgets. This resulted in a 59% first year OpEx reduction.
