0

Google G-Suite is rebranding itself as Google Workspaces, which means everyone needs to choose a new Workspaces payment plan in order to maintain service.

Google Workspaces can be paid-for either on a monthly "Flexible Plan" basis or with an annual commitment.

Usually when a company has an annual plan they'll attach a modest discount in exchange for getting the money up-front (so I'm saving ~10% on my Office 365 subscription that way), but Google Workspaces has zero discount, and in-fact, the plans are seemingly identical, except the annual commitment plan makes you commit to a commitment (sorry, I lost my thesaurus), so why on earth would anyone choose the annual plan?


This is Google Workspace help page comparing the two plans, as of 2022-07-03 this is what the page says, and as the comparison table shows, there's no advantage to the Annual plan:

https://support.google.com/a/answer/1247360?hl=en&fl=1

Google Workspace offers 2 payment plans.

Flexible Plan: You’re billed monthly for each user account. You can add and remove accounts at any time and pay only for the accounts you have during that month. You can cancel service at any time without penalty

Annual/Fixed-Term Plan

You commit to purchasing the service for a full year or multiple years. If your team grows, you can purchase more licenses and your monthly rate goes up. You can reduce licenses or monthly payments only when renewing your plan at the end of the contract. If you cancel your subscription before the contract is up, you still pay for the full commitment.

Pricing

Flexible Plan Annual/Fixed-Term Plan
Commitment None 1 year or more of service for licenses purchased at the start of the contract. Note: To choose a multi-year plan, contact a Google Sales representative
Billing cycle Monthly Monthly
Monthly payment Business Starter: USD 6 per user
Business Standard: USD 12 per user
Business Plus: USD 18 per user
Business Starter: USD 6 per user
Business Standard: USD 12 per user
Business Plus: USD 18 per user
Yearly total Business Starter: USD 72 per user
Business Standard: USD 144 per user
Business Plus: USD 216 per user
Business Starter: USD 72 per user
Business Standard: USD 144 per user
Business Plus: USD 216 per user
Add users At any time for additional monthly cost At any time for additional monthly cost
Remove users At any time (reduces monthly cost) Only when you renew the contract. Until then, you pay for all purchased licenses.
Cancel service At any time without a penalty Must pay full commitment (even if you cancel early).

In the FAQs section they almost answer my question...

Which payment plan should I choose?

Annual/Fixed-Term contract: With the Annual Plan, you commit to paying for 1 year or more of service, while there is no contract with a Flexible Plan.

Removing users: With the Annual Plan, you commit to paying a monthly fee for a minimum number of user licenses, for the length of your contract. You can't reduce the number of licenses (and therefore your monthly payments) until it's time to renew the contact. With the Flexible Plan, you can remove user accounts at any time and your next monthly payment will go down accordingly.

The Flexible Plan might therefore be best if you have a variable workforce. For example, businesses that provide vacation services might double in size during the summer months. A Flexible Plan allows these companies to provide temporary employees with Google Workspace and only pay for the service while it’s used. User accounts can then be deleted when employees leave at the end of the summer.

The Annual/Fixed-Term Plan might be best if you have a larger workforce and your team is generally growing in size. You can add licenses as your workforce grows.

...so the only argument in favour of the Annual plan is "if you have a larger workforce and your team is generally growing in size" but that is simply not supported by the fact the Flexible and Annual plans have the exact same per-user pricing - but the Annual plan has far less flexibility.

Am I missing something?

1
  • 3
    Product pricing doesn't seem on-topic here, but locking in a price means you don't have to worry about an increase within the contract period. There's also a good chance that they do offer discounts, especially on multi-year deals if you contact sales.
    – Hart CO
    Commented Jul 3, 2022 at 17:29

1 Answer 1

1

For businesses, the point in time when they pay can be of relevance, as they get to deduct their cost in the fiscal year they paid it (if at least one day of the period paid for is within that fiscal year).
So you pay for all employees a month before fiscal year end, save taxes in that year, and start the new fiscal year with the service already prepaid.

Most large companies play that game with all their licenses and subscriptions, for significant amounts - if you're GE and have 100000 MS-Office licenses, etc., that adds up to quite a difference.

1
  • Not every prepaid expense can be deducted that way. You're referring to the 12-months rule. Better put a reference or provide a bit more detailed explanation.
    – littleadv
    Commented Jul 3, 2022 at 20:05

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .