NSGIC Discussion: ESRI Enterprise License Agreements

Recently, Puerto Rico GIS Coordinator Iván Santiago posted a question to the NSGIC listserv seeking information from others on ESRI's Enterprise License Agreements (ELAs). What follows is his summary of the responses he received.

The original question was:

I’d like to know if somebody has information about states involved in global licensing agreements with ESRI, especially in terms of savings. The Commonwealth of Puerto Rico is in the process of evaluating an ESRI global licensing agreement. If someone can share savings/expenditure information, that will be very much appreciated.

Six out of the 18 states that shared their experiences have an active, signed ELA or are in the process of renegotiating one with ESRI. Two states with ELAs can show detailed savings and cost-recovery mechanisms. Their experience with their respective ELAs has been positive.

What factors made for a successful ELA?

1. Firm control over licensing.
2. Administrative cost recovery by charging other agencies by the usage of the software.
3. Dedicated administrative structure for ELA management. This may involve licensing and training registration management, technical support (at least at level [tier] 1). Technical support might involve a number of public employees to help with installation, GIS analysis and cartographic issues, server and database technologies, and programming.
4. Help developing geospatial technologies in their state agencies by reducing initial costs.
5. Virtual Campus: Their experience showed this is a good resource.

Success story #1:

1. Centralized license server with script and logging usage to charge agencies
2. Cost recovery through imposing fees to agencies using licensing and help desk services
3. Dedicate structure to manage ELA at the agency
4. Virtual Campus: advantageous

Success story #2:

1. Good organizational structure to manage licensing, passing costs to agencies and cost recovery
2. Advice: involve financial people
3. Advice: Define your needs/goals before begin negotiations

Cautionary tale #1:

1. Have ELA, but the state needs to reduce costs
2. Agency Point of Contact assumes administrative costs
3. Dedicated personnel to manage licensing, customer service, server architecture, programming
4. Other agencies were saving money
5. Difficulties in record keeping

Cautionary tale #2:

1. Advice: Figure out what has been spent, now and projected over the next few years
2. Work with your key agencies: “Big 7” or big players, Don’t meet with ESRI until you figure out what you need in an ELA
3. If ESRI offers a proposal, assume that [al]most everything is negotiable, Be patient
4. Education Agreement Program: ambiguous in terms of administration

Some reasons that ELAs were not adopted:

1. Administrative burden, which is also related to the lack of organizational structure
2. Perceived increased costs after initial period of agreement
3. The fear of unleashing unlimited licensing
4. Economic constraints and cost savings not showing during the negotiations
5. Satisfaction with existing Master Purchase Agreements

Some respondents (lead by Danielle Ayan [GA] and Michael Smith [ME]) discussed the advantages of the ELA, both to ESRI and to state and territorial governments.

Advantages for ESRI:

1. Ease administrative burden of licensing and maintenance accounts, all on varying time schedules
2. Reduce number of calls to support center
3. Encourage GIS adoption by many agencies, which is expected to lead to increased sales in the future
4. Revenue enhancement, revenue predictability, cost reduction

Advantages for states and territories:

1. Encourage GIS adoption through unlimited access to needed software
   
2. Help increase the use of geospatial technologies in their state, not just looking at it as a simple accounting exercise
3. Ease the procurement burden in acquiring software
4. Remove the high cost of starting out with the GIS software
5. Increase access to online training
6. Cost savings to the state
   

In general, an ELA is a good idea if the agency that will be the point of contact with ESRI has the personnel to deal with the administrative and technical support issues.

As Michael Smith put it, there are some other considerations that are not simply measured in dollars and cents. One of the main goals of this kind of agreement is to help disseminate geospatial technologies in government.

Once state employees know these technologies, a new level can be raised in which the state can explore new solutions, like open source and/or hybrid solutions made up of commercial and open-source tools.