Things to look out when subscribing to Software-as-a-Service (SaaS)

Hello everyone! To help everyone start the year right (by saving as much as costs as we can), our first article is to discuss about software subscription — what to look out for before we commit to one?

As technology like hardware servers moves towards cloud platforms, software providers are also impacted. Most software licensing models have moved from perpetual usage towards subscription-based which are easily purchased/activated via their respective websites. The software providers will publish 3 to 6 types of plans to cater for various target subscribers (e.g. students, educators, developers). The potential subscriber will then sign-up, select a plan, and pay based on the required features and budget limit.

But as potential subscribers, what should we take into consideration?

What must we look at before taking up the subscription?

Before confirming any subscription, the potential subscribers should take note on the following:

Payment Plan

Depending on the subscription period, the commonly found payments modes are:

1. Monthly prepaid for 1 to 12 months subscription
2. Yearly prepaid for one-year subscription

For (2), many software providers charge 10 or 11 months instead of the 12 months.

By making the prices more lubricative, subscribers who’re using the software on a long-term basis will have better savings. As for the software providers, they will have lesser administrative work to handle. It’s a win-win situation! 😊

Oh! Before subscribing, please ensure that the company’s credit card’s expiry date is not due soon. Many software providers charge a nominal fee (e.g. 1.5% per month) for late payment if the subscription payment or renewal cannot pass through successfully.

Frequently Asked Questions (FAQs)

Subscribers should read through the FAQs found on the software provider’s website. It will cover an overview of their plans, charges, and account management. Many software providers cater for free plans, but it doesn’t mean it is applicable for all types of subscribers.

Subscribers who are using the software for company work should take note and perform the necessary checks before signing up for free plans. The latter is usually meant for students or trial users (likely 7–14 trial days).

Terms and Conditions (T&Cs)

There are mainly 4 documents to look out for:

1. Terms of Service (ToS) or Terms of Use (ToU)
2. Privacy Policy
3. Cookie Policy
4. Service Level Agreement (SLA)

For ToS/ToU, subscribers are required to abide/follow all “rules” indicated by the service provider. Thus, there may be legal implications when “rules” are broken and it depends on the severity. Most software providers will take serious action towards the following:

• unlawful use of their services (e.g. reverse engineering or modification),
• bad user conduct (e.g. harassment, defamation),
• violation of copyright, trademark, or patent

It is also important to take note which country is governing the T&C; they may not be in the same country as the subscriber.

For both the Cookie and Privacy Policies, they cover how and why the subscriber’s information is being shared on the software provider’s end — mainly for technical support, marketing and admin purposes, payment process and their third parties’ partners (e.g. cloud platform).

For SLA, the software providers cover their services’ monthly uptime percentage and any planned maintenance. They will also provide details on their support hours and response time, including the support email to reach out to.

Account Termination Notice

Before subscribing to any software, it is always important to find out the termination process, just in case you found a better software or don’t quite like the software after using it for quite some time. But if that’s always the problem you face, please refer to our previous article about how to conduct a tool POC in 5 steps to help you better determine if this software/tool suits you.

While some of the software providers allow immediate account termination, others require the subscribers to submit termination requests at least 30–90 days notice. Hence, it is advisable to keep track of the expected termination notice and subscription end date to avoid unnecessary payments. For instance if your subscription ends on 30 June 2024 and its SLA indicates 30 days termination notice is required, it is recommended that you write to the software provider’s support team to request for termination on the 30th or 31st of May 2024.

We hope that this article has helped you (as a potential subscriber) to understand what to look out for before you click on the “Buy Now” button. The process of procuring a software/tool can be quite long and tedious for some organisations, which is why we shared the list of pointers (not an exhaustive list though) with the hope that you will not get a shock when you decide to stop the subscription.

Be safe and stay vigilant of potential scams~

🧙🏼‍♀Team Merlin 💛
Application security is not any individual’s problem but a shared responsibility.