Third Party Maintenance Costs
TPM Costs — Why Is It Cheaper Than OEM Support?
It’s no secret that third party maintenance costs are significantly less than support through the OEM. Depending on the manufacturer, device, and situation, the savings could range anywhere between 50-80%. So why the price difference?
Manufacturers want to sell more hardware
It comes down to a basic difference in business focus. Original equipment manufacturers (OEMs) are in the business of hardware sales. Their energies and focus are on selling equipment not providing service. In fact, it is usually in their best interest to charge more for hardware support as the equipment gets older. This strategy creates a dilemma for the customer—is it worth paying more for support on older equipment or would it be more cost effective in the long run to upgrade to new equipment?
TPM providers are in the support business
This is where third party maintenance providers (TPMs) can jump in and really shine. TPMs usually center their businesses around service which means that they usually concentrate their efforts and resources on providing a positive customer experience. They also can provide advantages that OEMs don’t such as flexible contracts, custom expiration dates, and in M Global’s case, a dedicated parts stocking strategy. TPM providers also can provide service for multiple manufacturers so that contracts can be consolidated into a single contract saving time and money.
Another way that TPMs can save you money besides a much less expensive contract is that they will support devices that are no longer covered by OEMs or end of service life (EOSL) devices. If you have devices that are no longer covered by the manufacturers, you have two options. If you plan to get support through the manufacturer, you will have to buy new equipment. Or you can switch to a third party maintenance provider who can continue supporting your current devices until you are ready to upgrade. It doesn’t take an accountant to figure out which option will be better for the budget.
So, How Much Does Third Party Maintenance Cost?
A quote for a hardware support contract is dependent on several factors including the SLA options that you want, number and type of devices, budget and environment considerations, and more. So you can see how each support quote will be unique to the client asking for it. But to give you an idea of the cost savings that are possible, here’s a couple of examples of hardware support for HPE devices from both HPE and M Global Services. (The M Global price reflects standard conditions and is subject to change.)
- HPE 1 Year Post Warranty Tech Care Critical Service: HPE List Price: $2,867
- M Global 7x24x4 with Defective Media Retention + On-site Support: M Global Price: $350
- HPE 1 Year Post Warranty Tech Care Critical Service: HPE List Price: $2,620
- M Global 7x24x4 with Defective Media Retention + On-site Support: M Global Price: $395
- HPE 1 Year Post Warranty Tech Care Critical Service: HPE List Price: $3,525
- M Global 7x24x4 with Defective Media Retention + On-site Support: M Global Price: $595
What goes into a hardware maintenance quote?
A third party maintenance hardware support quote will include the details of your desired SLA options. At M Global, we like to make sure our quotes are detailed and thorough so that you know exactly what you are getting and that your contract meets your needs.
Response Times & Parts Stocking Needs
While it's obvious that different SLAs come with different price tags, there's a few key components that will have a major impact on costs. Response times are the first and often most important part to consider. If your environment is critical and downtime must be avoided, you're probably going to need 24/7 support which will cost more than an SLA that offers 9x5xNBD support. Likewise, certain parts stocking needs outside the usual "commonly failed parts" such as specific parts, quantities, or stocking locations might be a little more expensive.
Quantity of Devices, Location, Level of Sourcing Difficulty
Other factors that could impact a hardware quote include the number of devices, environment factors (such as an extremely remote location), and the level of difficulty to support. For example, if a device is very old or uncommon, parts might be difficult to source, which in turn will affect the cost.
While there are many elements that go into putting together an SLA that works both with your budget and meets your needs, we've put together an SLA decision tree that can get you started.
How can I keep costs down on a third party maintenance contract?
Expert Third Party Maintenance Quotes
An expert quote can not only ensure you get the coverage you need, but it can also save you money. Extensive knowledge of what it actually takes to support the equipment (as opposed to a salesperson just trying to make their numbers) can make all the difference. Our quotes are prepared by team members who know the service side of the desk too and can help you prioritize the elements of service you need most.
Hybrid and Short-term Contracts
Often the support needs in a data center environments are not straight forward. Maybe there is a combination of new devices still under OEM warranty and some devices that it makes sense to save money with third party maintenance support. Or maybe you have plans for a hardware refresh, but it's taking longer than you planned so you need some short term hardware support to fill the gap. A one-size-fits-all support solution is rarely the most cost effective route. It's not just the SLAs that can be customized. A service package that aligns with what makes the most sense for your environment might mean some form of hybrid maintenance or maybe a 3 or 6-month contract instead of a full year.