THE DEMOGRAPHICS OF FEE-BASED SUPPORT.

Conventional wisdom suggests that service businesses are too people-intensive for small companies, and in fact almost half (47%) of our respondents report annual revenues of over $10 million. But our respondents also include a good many small companies -- 14% with revenues under $1 million, and 25% with revenues of $1-$5 million.

Moreover, company size generally has little impact on most fee-based support metrics. Among companies that report at least some revenue from fee-based programs, for example, the median contribution is an identical 20% for companies with under $1 million in sales, $1-$5 million, and $5-$10 million; the revenue contribution drops to 15% only for companies in the $10+ million range. Similarly, smaller companies are generally able to set service prices -- for maintenance, training, and consulting--that are usually no different from big- company service prices. In fee-based services, at least, the playing field is still reasonably level.