Vendor-Driven Upgrades Saddle IT Leaders With Huge 'Software Tax'
CIO, Thursday, October 22nd, 2026
A survey finds vendor-pushed upgrades and licensing changes eat about 28% of large enterprises' software budgets, about $12.9M a year.
A survey commissioned by third-party maintenance firm Origina, which sells alternatives to vendor support, found that vendor-pushed upgrades, migrations and licensing changes consume about 28% of software budgets at large US and UK enterprises, averaging nearly $12.9 million per year.
Ninety-five percent of IT leaders said they had paid for a vendor-driven upgrade in the past three years that they believed would reduce performance.
Switching costs and the threat of losing support give vendors leverage, a squeeze familiar to VMware and SAP customers.
Origina CEO Tomas O'Leary says vendors are expert at writing contracts in their favor and that repeatedly trying to negotiate better terms is a failed tactic.