Is it Worth It? What You’re Really Getting from an Extended Service Agreement

Extended service agreements from hardware and software vendors often times get a bad rap. End users may see them as unnecessary added costs to an already burgeoning IT budget. But, what are you actually getting if you renew coverage on your IT hardware? This depends largely on the vendor, the coverage options and the type of product. Here, we will delve into when renewing is worth it, when it’s not, and how to budget.

  • Read the fine print: Don’t get us wrong, current support on your hardware can mean free replacement parts and helpful remote support in diagnosing the issue with your machine. However, many times hardware vendors may quote “cheaper” extended coverage options that generate revenue but not a lot of value to the end user. For example, vendors like Dell may offer “basic” extended support options for hardware (in addition to other advanced options like “ProSupport”). It’s important to read your coverage options carefully: the fine print can often include items like, “no geographic guarantee” or “return to depot-mail in after phone based troubleshooting.” This can mean added time and energy spent on an issue that may not even be covered under the “basic” warranty.
  • Pay attention to support renewals for “mission critical” hardware: Your server, networking and backup equipment are integral to your daily operations. Renewing hardware coverage for your switches, servers and firewalls can mean the difference between a little and a lot of downtime. Tip: look for 24×7 vs. 8×5 support if you are largely dependent on your vendor for support and check if any type of onsite support is included.
  • Don’t forget software support: Often times, extended software support coverage groups maintenance, customer support and access to updates all together. For example, VMware software support renewals give you technical support as well as access to updates within their two tiers of software coverage: Basic and Production. The difference lies within the amount of support you need (weekday 8-5 or 24×7). In order to stay up to date with the latest versions, renewing is essential. Falling behind on this type of coverage can result in costly reinstatement fees that would be better to avoid.
  • Perpetual vs. non-perpetual licensing: When purchasing licensing up front, make sure that your service provider distinguishes whether your software costs are up-front or on an annual basis. For example, Backup Assist offers a perpetual license but also offers an annual/bi-annual software coverage option called “BackupCare” that guarantees you access to the latest versions. However, choosing not to renew BackupCare will not affect the functionality of Backup Assist. Other vendors like Barracuda have a non-perpetual licensing structure; for example, their “unlimited cloud storage” functionality of an onsite backup appliance requires a yearly renewal in order to continue to send data to the cloud. Knowing the difference between perpetual and non-perpetual licensing can allow you to more easily budget for yearly service agreement renewals.
  • What Techlocity Recommends You Renew: As stated in point #3, mission-critical applications and hardware are always important to keep current. We recommend that you keep up on the following extended service agreements:
    • Servers (recommend 24×7 coverage)
    • Switches/Firewalls
    • Backup Solution
    • Business-Critical Software

Techlocity reminds our managed services customers 30 days ahead of upcoming extended service warranty expirations. If you have questions on your warranties or would like a 365 day forecast of upcoming renewals, contact us at 317.288.5474.

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