No. Enterprise software is still getting more expensive for many buyers, and usage-based charges can make the final bill harder to predict. The better news is that costs are not entirely beyond a buyer’s control: license reuse, careful renewal terms and realistic usage forecasts can reduce avoidable spend.
Why does enterprise software keep getting more expensive?
There is evidence of significant price pressure, though no single figure describes every vendor or contract. Gartner analyst Mike Tucciarone said subscription costs from several large vendors rose 10%–20% in 2025, while projected IT-budget growth was 2.8%, according to CIO’s 2025 report. Those are reported increases at several large vendors, not a claim that every enterprise subscription rose by that amount.
Software is also taking up a larger share of technology budgets. Boston Consulting Group reported that software’s share rose from 13% in 2019 to 21% in 2024—an increase of eight percentage points. The pressure reflects both price and the expanding role of software in organizations’ technology spending.
Vendors cite generative-AI features, inflation and sustainability costs as reasons for increases, according to Gartner. Those explanations do not by themselves show that a price increase delivers equivalent value to a buyer. The practical question at renewal is what changed in the product, what the organization actually uses, and whether the added cost produces a measurable result.
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Is SaaS pricing getting out of control?
For some organizations, the problem is not just a higher subscription price but lower predictability. Capgemini’s 2025 research characterized on-demand technology costs as a “black hole” for 58% of respondents and reported bill shocks from unpredictable cloud-usage spikes for 56%. These are survey findings, not a universal estimate of how often every company experiences a surprise bill.
Consumption pricing can make spend rise or fall with use, but it can also weaken the connection between the number of licensed seats and the amount owed. If a service charges by calls, storage, transactions or another unit, growth in demand may raise costs even when the seat count is unchanged. A buyer needs to know the billable unit, how it is measured, and what happens when usage crosses a threshold.
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Demand for enterprise software remains substantial. Gartner projected 8.2% growth in global IT spending for 2025 in a 2024 update. Separately, Futurum’s 2025 survey found that more than 25% of surveyed IT decision-makers planned to spend $1 million–$5 million on enterprise software in 2025, while another 22.2% planned $500,000–$1 million. These are different measures—one a spending-growth projection and the other reported plans among surveyed decision-makers—and neither establishes what a particular company can afford.
Should you move from per-seat to usage-based pricing?
There is no universally cheaper billing model. Compare the offer against your demand pattern and ability to monitor or limit usage, not just its advertised starting price.
Rank #3
| Model | Budget predictability | How spend scales | Main buyer risk |
|---|---|---|---|
| Per-seat | Usually the easiest of these models to forecast when seat counts and rates are fixed. | Typically changes with the number of seats. | Paying for inactive or duplicated seats, or facing renewal increases. |
| Usage-based | Can be harder to forecast because charges depend on consumption. | Can align payment with demand, but usage growth can raise the bill. | Unclear billing units, spikes, or a lack of effective caps and monitoring. |
| Hybrid | Combines a base commitment with variable charges; predictability depends on the terms. | Base spend is more stable, with additional cost tied to usage or overages. | Underestimating variable usage or accepting unclear overage rules. |
Score each proposal on seven questions before comparing totals:
- How predictable is the price over the contract term?
- Is the billing unit transparent and independently auditable?
- Does the model scale sensibly with actual demand?
- How much leverage will you have at renewal, and how difficult is it to switch?
- What implementation and integration costs are required?
- Can you cap, monitor or audit usage?
- What measurable business value will the purchase deliver?
How can buyers cut software costs without hurting productivity?
Start with what the organization already owns and uses. Flexera reported in 2024 that organizations achieved savings through license reuse (45%), better vendor-contract negotiation (37%) and reducing maintenance on unused software (36%). These are reported savings approaches, not guaranteed savings rates for any one company.
Rank #4
- Build a complete inventory. Record each product, license owner, renewal date, usage, overlapping functionality and maintenance obligation. Make the inventory usable by both IT and procurement.
- Reassign before purchasing. Check whether an existing license can be reused or reassigned to the person or team requesting another seat. Confirm the contract permits it.
- Remove spend that no longer supports work. Review unused seats, overlapping tools and maintenance on software that is no longer in use. Validate with the teams affected before removing access.
- Separate the cost components. Model the base subscription, implementation, support, data and AI or other consumption charges separately. A low subscription price can obscure substantial costs elsewhere.
- Require an outcome and an owner. Tie each major purchase to a measurable result and name the budget owner responsible for tracking whether that result is achieved.
What should procurement negotiate at renewal?
Renewal is the point to make future costs and buyer rights explicit, rather than relying on a headline discount. Ask for terms that let the organization forecast, verify and adjust the commitment.
- Price increases: Define any renewal cap and how it applies to each product, tier and renewal period.
- Usage definitions: Specify each billable AI or consumption unit, how it is counted, and how disputed measurements can be audited.
- Spending controls: Request usage ceilings, alerts before thresholds and a clear process for authorizing overages.
- Commitment flexibility: Negotiate true-down rights or other ways to reduce a commitment when demand or seat counts fall.
- License rights: Clarify reassignment, reuse and audit terms so cost controls do not create unexpected compliance exposure.
- Full cost visibility: Put subscription, support, implementation and variable charges in the same business case and confirm which are included in the quoted price.
Before accepting a large metered commitment, pilot the feature and record production usage over a representative period. Use that observed pattern—not only a vendor estimate—to model likely spend and stress-test what happens if usage rises.
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Is enterprise software objectively too expensive?
There is no universal affordability threshold or comparable cross-vendor total-cost figure that settles the question for every enterprise. The actual burden depends on seats, usage, implementation, geography, contract terms and the value realized. The evidence supports continuing price and predictability pressure, not a conclusion that every product is overpriced or that every organization should reduce software spending.
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