New Coalition to Advocate for Choice and Competition in the US Software and IT Hardware Repair and Maintenance Market

FreeICT USA will serve as the voice of the independent support and maintenance market in right to repair debate.

A new coalition was announced today to promote increased competition in the US software and IT hardware repair and maintenance market, bringing relief to companies owning products purchased from large Original Equipment Manufacturers (OEMs).

FreeICT USA will seek solutions to address restrictive policies, exorbitant costs and declining service imposed by Big Tech that are costing American businesses countless millions.

The coalition is aligned with the successful Free ICT Europe coalition that has been operating since 2014.

“We believe customers who paid for the IT products from the mega-vendors should be free to choose their maintenance and repair provider,” said Shannon Mahaffey, FreeICT USA’s president. “Much of the ‘right to repair’ debate is focused on consumer-facing goods so major enterprise software providers have been able to evade any level of scrutiny,” he said.

Mahaffey said that some giant technology companies typically enjoy 90 percent profit margin on support and maintenance yet are not using these profits to improve the supported software products or keep hardware parts available for older models of equipment.

Digital services are part of the nation’s critical infrastructure. The rules that govern their maintenance and reliability are written by large, unaccountable technology companies that want to stifle new competition and protect a wildly profitable revenue stream.

The software maintenance and repair market is estimated to be more than $175 billion; the secondary hardware market represents an additional $70 billion of which $20 billion is in the U.S.

Without a viable alternative, end users are forced to endure expensive, low value upgrades, high and rising support costs and declining customer service. This is further amplified when there are supply chain shortages, as was noticeable in the restricted chip supply that stopped business in 2019-2020 and has been further increased by recent problems in Russia and Eastern Europe.

“There has been remarkable progress in the American right to repair movement, especially at the state level,” said Jake Blough, chief technology officer at Service Express. “This coalition’s job is to make sure the right to repair debate includes software and hardware and frees businesses to access the secondary repair market.”

Economic Benefits of More Competition

Big software companies write rules to protect themselves, but they are hurting their customers and the economy in three major areas:

  1. High costs that are rising far faster than inflation. Companies typically spend as much as 90 percent of their IT budget on ongoing operations and enhancements. Some government agencies spend more than 90 percent of IT budgets on legacy systems. With the US government planning to spend more than $109 billion in 2022, cost of operating and maintaining legacy systems in the federal sector alone could potentially cost billions in taxpayer dollars severely limiting investments in new systems and growth.
  2. End of support: Major software vendors are forcing customers to abandon fully functional and customized systems and migrate to their new cloud platforms or upgrade to new, low value software releases costing customers substantial budget, resources and time just to retain full support.
  3. Forced upgrades & migrations: Long-term strain on IT budgets because of restrictive vendor maintenance policies leaves little to no funding for new development or transformation initiatives resulting in an uncompetitive economy and ultimately, lack of new value and job creation.

Environmental Impacts of Forced Obsolescence

There are also considerable environmental impacts resulting from restrictive repair policies and forced hardware replacement.

  1. Elevated GHG: The share of ICT in global greenhouse gas emissions has increased dramatically since 2013, rising from 2.5 percent to 3.7 percent of global emissions. By 2040, the production and use of electronic devices is predicted to account for 14% of greenhouse gas emissions according to the World Economic Forum.
  2. Increased waste: Lack of reuse and repair/refurbishing in the ICT sector shortens product life and increases e-waste. Every year, 60-90 million metric tons of electronic hardware is produced globally.
  3. Forced obsolescence: Manufacturers force product obsolescence, decreasing the life of well-functioning systems and equipment resulting in further environmental damage.
  4. New raw materials: New products result in a far higher consumption of resources. Meeting this demand requires mining raw materials, including certain metals which cannot be captured in recycling, leading to an increased environmental burden. Many of the materials in IT hardware are on the Critical Minerals list – meaning that supply is limited by geological or political factors.

The Solution: More Choice and Competition

Every software end user has a choice: 1) stay on a vendor-dictated model and continue the cycle of forced, low-value upgrades and subpar support designed to benefit the vendors; or 2) take control of their IT roadmap with the freedom to choose how their equipment or software is to be repaired or maintained.

FreeICT USA’s mission is to enable choice by challenging the legitimacy of restrictive vendor policies and support models.

With the right policies in place software end users will be free from unnecessary upgrades and can maximize the lifespan and value of stable, perfectly functioning systems. This not only reduces the use of non-renewable resources and lower carbon emissions from equipment waste but can also help businesses save millions of dollars by extending the life and value of their current systems.

FreeICT USA will urge policymakers to continue to introduce and support bills like the Fair Repair Act by Rep. Joseph Morelle (D-NY) in June 2021 and Senator Ben Lujan in March 2022. These bills require hardware manufacturers to make diagnostic and repair information, parts and tools available to third-party repairers and owners in a timely manner and on fair and reasonable terms.

It’s now time to extend the same rights to software customers to protect this vital part of the nation’s infrastructure.

The founding members of Free ICT USA include Origina North America (Plano, Texas), Park Place Technologies (Cleveland), Spinnaker Support (Greenwood Village, Colorado), Techbuyer (West Deptford, New Jersey and Rochester, Minnesota), Service Express (Grand Rapids, Michigan) and Free ICT Europe (Gouda, Netherlands).

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