Unitrends Five-Year Subscription Term and Pledge and Pledge Plus

Last week I posted  “No Limits Unitrends Cloud to Free Forever Infinite Hardware to New Appliances to New Features“, and after hearing from many of you, wanted to expand upon particular items mentioned in that post, starting with our  Five-Year Subscription Term, No Surprises on Support Costs.

We have added

• a 5-year subscription contract for support
• hardware services, and
• Unitrends Cloud

in response to customer demand.  This is in addition to its 1- and 3-year subscription contracts we have offered in the past and continue to offer.  Our 5-year subscription contract enables customers to lock-in their subscription pricing over a 5-year period for a discount – important across the board – and particularly important with our Pledge and Pledge Plus hardware refresh programs.

Obviously longer-term subscriptions allow customers to avoid subscription price increases over time and thus avoid any year-over-year price increases.  In addition, our 5-year terms include a special loyalty discount of 60% on one new appliance of equal or less capacity during the term; 3-year terms include a special loyalty discount of 40% on one new appliance of equal or less capacity during the term.

Beyond that, the question most typically asked is how Pledge, Pledge Plus, and subscription terms work together.  After all, terms are 1, 3, and 5 years – and yet Pledge and Pledge Plus entitle a customer to a new appliance after 4 years, so what’s going on here?  It’s pretty simple – here are some examples.

A customer with an appliance becomes eligible for a new appliance after four years – so let’s call it four years plus one day.  Obviously the customer has to have an active Pledge or Pledge Plus contract in order to receive her or his new appliance.  In the simplest case, that Pledge or Pledge Plus subscription term is for five years – so at four years and one day, a new appliance is shipped to the customer who requests it.  Because the customer elected for a five year term, the Pledge or Pledge Plus subscription cost for that fifth year is set in stone – it can’t change.

Let’s take the case where a customer elects to purchase a Pledge or Pledge Plus subscription in one year terms.  So the customer buys the first year, the second year, the third year, and the fourth year.  The pricing may or may not change during each one of those purchase periods.  After the fourth year (four years plus one day), the customer wishes to receive a new appliance.  Because they must be actively enrolled in the Pledge or Pledge Plus program, they must have purchased the fifth year of Pledge or Pledge Plus prior to that request.  Or to put this more clearly, a customer must have purchased their fifth year of Pledge or Pledge Plus immediately before requesting their new appliance.

When customers first see that they are entitled to new hardware after four years, and they see a five year subscription term, their immediate thoughts are sometimes around what occurs in the fifth year after they have received a new appliance: are they paying new support, Pledge, or Pledge Plus amounts based on the new appliance in that fifth year?  The answer is always “no” – because an active contract was required in the fifth year – which includes four years and one day all the way to four years and 364 days (365 days in the case of a leap year) – and thus that fifth year contract was based on the original appliance.  What’s the catch?  The catch is that pricing can, and often does, increase over time for programs such as this – which is why five year subscriptions are what I always recommend for customers who wish to have more predictable control of their spending.

Thanks for reading.  And as always, looking for feedback and discussion on this or other subjects.