Why RBackup Online Backup Software is a Really Good Bargain.

If you go to the RBS website and look up prices you will find that a 100-License version of RBackup costs $2150 (as of November 2010.) That’s $21.50 per license. Maybe that sounds expensive at first glance, but it’s really a bargain. Here’s why.

 

 

What’s a License?

Installing the RBackup Client on a Windows Server uses four Licenses. Installing on a Workstation uses two Licenses. A personal computer uses one License. Permanent Licenses last forever, can be re-used, and never have to be renewed. Monthly Licenses (for our Subscription License Models) must be replenished.

You can read a full explanation of how Licenses work here.

Studies by Carbonite show that the average Online Backup customer stays with the same Service Provider for an average of 42 months. My own experience shows that this estimate is low, but of course I’ve been in this business for two decades longer than Carbonite.

So, if you amortize the cost of the software over the average life of each end user, you get to the real cost of the software. In the case of Windows Servers, you are paying $86 for the software (4 Licenses at $21.50 each). Over the life of the end user, this works out to a software cost of just barely over $2/month. That’s really cheap.

You are going to charge at least $39/month, aren’t you? Most Service Providers in my network charge at least $89/month for a Server in their least expensive plan. Two dollars a month for software cost is VERY affordable for the software your entire business is based on. Right?

And remember, Permanent Licenses are PERPETUAL, and you never have to renew them. If you lose a customer, the Licenses recycle automatically and you can use them with another customer – forever. So, my example of amortizing the cost of Licenses over the life of a single end user is actually a worst-case scenario. The correct calculation should be to amortize the cost of the software over the length of time you expect to be in business and your expected number of clients.

Looking at it another way, if you charge $89/month for a Server, you can recover your software cost in the first month – and again every time you reuse those 4 Licenses with a new customer.

Let’s do this calculation again, this time for Workstations. Because Workstations use only two Licenses, you are spending only $43 for software – that’s a dollar a month (worst case.) Most people charge a minimum of $39/month for backing up workstations. Again, you are almost recovering the software cost in the first month, and I think you will agree that you can afford $1/month.

If you are going to service personal computers, you will pay only $0.50 (fifty cents) per month for the software. Look, even if you want to sell your Personal Computer Backup Service for $4.95 a month to compete with Carbonite, your software cost of fifty cents is a bargain.

“Sure, Rob, but you’re asking me to pay for all the software up front, before I sell anything!”

Yes I am. Just like your hardware vendor wants you to pay for your computers; just like Microsoft wants you to pay for Windows; like Intuit wants you to pay for QuickBooks.

Business has expenses. You have to buy the tools that will make you successful. Entrepreneurial people like you and I learn to thrive in this environment.

RBackup is a bargain. You are not buying a commodity like a toothbrush or a pair of shoes. We have poured many years and millions of dollars in research and development into RBackup. We spend a lot of money to maintain the infrastructure, employees, offices, and services that you need for support, maintenance, and continued development so your business can keep up with the needs of your end users.

You get the benefit of all of this ongoing development and experience for $.50/month to $2/month. How is that too expensive?

Hmmm. Now I have convinced myself that my prices are too low. You’d better hurry up and buy something before I think about this anymore.

Rob Cosgrove is the President of Remote Backup Systems, founder of the Online Backup Industry, and a vocal advocate for maintaining the highest standards in Online Backup software. His latest book, the Online Backup Guide for Service Providers: How to Start and Operate an Online Backup Service, is available online now, on Amazon.com, and at bookstores.

Remote Backup Systems provides brandable, scalable software and solutions to MSPs and VARs enabling them to offer Online Backup Services.