Calculating The Total Cost Of LMS Ownership: Why Cheap LMSs End Up Costing More

How To Calculate The Cost Of LMS Ownership: 5 Points To Consider

Most organizations choose an open source or inexpensive LMS by default while gearing up for eLearning, as they believe that it would allow them to keep their training costs low. However, there are several catches to this decision that tend to miss the eye. Organizations sign up for these systems unaware of the potential bill shock that is about to come their way.

Here’s breaking the myth behind the total cost of ownership of a seemingly less expensive LMS.

1. Only The License Costs You Nothing

Yes, you heard it right. Only the license cost is zero for any open source LMS. The procurement, management and support aspects are still going to cost your company big money.

Given the difficulty in predicting how the LMS will be used in the future, you would need to set up a server and a hosting architecture that can handle multiple users connecting simultaneously. The one-time cost for a professional IT vendor to connect with you, understand your needs, recommend a suitable server configuration and customize the LMS to your needs, without an upgrade for a few years, is approximately $4,000.

You would also need a graphic designer or agency to customize the look and feel of the LMS to suit your brand. Customization of features which is likely to modify the workflow of the system can cost anywhere over $15,000.

Using a solid hosting service can cost your company anywhere between $200 to $350 dollars per month. Similarly, obtaining a security certificate can again cost you about $150 as monthly pay-out. A client side hosted LMS costs up to $25,000.

2. Handholding Costs A Fortune

If you have the LMS installed by a vendor, your company would only incur a one-time cost. However, you will need assistance from IT personnel for server-related issues, forcing your costs to round off to an additional $40 per hour calculated at 25 hours per month.

This is particularly true if your user base is over 500 or 1000 users. Most of the LMS vendors do not have even phone support. The ones that provide training and a basic level of support via email or limited phone hours charge anywhere between $4,000 and $7,000 for these services.

Adobe offers free 24x5 LMS support and also, if you are a reasonable sized customer, you get assigned a customer success manager to help you onboard. These customer success managers can onboard clients in an average of 41 days, which is unheard of as far as LMS industry is concerned.

3. How Important Is The Infrastructure?

Adobe Captivate Prime uses a highly secure, scalable and flexible infrastructure hosted on the Amazon Web Services (AWS) cloud. Adobe’s investment in infrastructure is unmatched, compared to inexpensive Learning Management Systems. It uses clustering to enable high availability and parallel processing, failover to ensure that there is always a backup in case of server failure and auto-scaling to facilitate an automatic scaling of the number of active users based on the load on the network. The LMS also provides backup storage and edge servers. All of this makes it a more reliable and high performance platform.

And yes, let’s not forget that you would need full-timers or part-timers to help you with the administration of the LMS. These resources will need to be trained on using the LMS, and the person installing the system would be the best person to train them, as the system is customized. That would need your organisation to set aside another $17,000 approximately.

Lastly, have you considered the upgrades aspect of the LMS? Organizations rarely consider the costs to upgrade their LMS. The more an LMS is customized to suit your needs, the higher the costs to upgrade it.

So, though an open source or cheap LMS may sound like an attractive idea at first, you’re only likely to feel deceived by the end of your association with the product.

4. What About Unlimited Usage Benefits Then?

There is always a caveat with unlimited usage. Though inexpensive LMSs promise unlimited usage, they place a cap on the number of active users per month. This model is of little help if you wish to roll out training for your entire staff.

If you still think you can work around these shortcomings and use such an LMS to your best advantage, consider this: You will be signing up for a system that is already over-burdened with other unlimited usage customers.

In contrast, Adobe’s Captivate Prime uses auto-scaling to ensure that the application is available to your users. It also scales up or down the capacity automatically.

5. But Do These LMSs Serve Their End Purpose?

Not really. Organizations choose to invest in Learning Management Systems only so that learning turns into an ongoing process that can sink into the character and culture of the brand. For this to happen, employees need to be able to consume information on the go from any form of content. This calls for the elimination of the time spent on preparing elaborate course material and switching between platforms to view the content.

Adobe Captivate Prime addresses the learning problem with its development of a single platform that can support all forms of content: the Fluidic Player. Adobe Captivate Prime’s Fluidic Player can showcase content in almost any format – PDFs, PPTs, DOCX, SCORM, AICC, xAPI-compliant packages and more. It uses high quality video streaming and a distributed delivery mechanism to serve content with minimum latency using Akamai edge servers and Brightcove video cloud, a leading online video platform.

However, the inexpensive LMSs in the market do not offer this level of flexibility with respect to playing multiple forms of content.

The total value of an LMS, both tangible and intangible, can never be arrived at, based on the initial price offered by vendors. Ensure that you do a thorough research, analyzing all factors, before you sign up for one.

eBook Release: Adobe Captivate Prime
Adobe Captivate Prime
Adobe Captivate Prime - A full featured LMS with a learner-first approach
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