Is beta software the right solution for your SMB?

For SMBs, Beta Software can be Risky Business

October 6, 2015 Tech4BusinessNow Article

One SMB’s experience using test-phase software reveals the risks and rewards of relying on beta software as a technology solution.

By Andrea Holved

The early release of software products—known as “beta” releases—is a long-used tactic for tech companies to get devout users to test their products. But “beta” is also a buzzword, and one that draws many SMBs who want to get in on the act, testing out products before they go to market.

Certainly, for SMB owners who need the latest, most innovative feature set, opting to use the beta version of a software product can be a great solution—for some businesses, a beta software product may be the only solution that offers the features they’re looking for. But often lost in the hype is the fact that using beta software is not without serious downsides.

Beta software is the version of a new software product or feature that hasn’t been widely released. It’s been through several stages of development and has been tested internally, but before it can be sold to the general public, the developers need testers to use their new software under real conditions and give them feedback.

A product in beta is not dissimilar to a new pharmaceutical drug in trials: The product has been rigorously tested and is considered safe to use. There’s a chance it will make it through testing, and that it will solve what you thought was an unsolvable business problem. But the reward isn’t guaranteed, and you may face serious tech bugs. Plus, the software you test might never make it to market, in which case it won’t be the business solution you were hoping to find.

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The team at EnCoCreative, a Sydney, Australia-based marketing firm, has been beta testing a project-management software product since March, and according to Ratko Ivanović, the manager who selected the software after looking at almost 20 options, it is exactly what they’ve been searching for. The entire team uses it daily, and the company even extends access to clients; the tool is completely integrated into their business.

Risks and rewards

Adoption of the beta software hasn’t been without its hiccups: the bugs have ranged from the tool not allowing Ivanović’s team to upload documents, to it mistakenly making “private” comments among the team visible to clients. Neither bug lasted long or caused a problem for Ivanović but, he says, “That’s one of the major risks using a beta software.”

One of the major benefits of using a product in beta is a price break. Not all beta software is discounted—many businesses choose to use it simply because the feature set is desirable to them—but plenty of beta software products, especially those offered by startups in competitive markets, are offered to testers for significantly less than the projected sticker price. EnCoCreative, for example, pays just 50% of the software’s full price, and that discount will continue in perpetuity if the software makes it through testing and is fully released. That could potentially add up to tens of thousands of dollars in savings for a product that Ivanović considers his top choice.

But if, in the end, the software doesn’t make it past testing, Ivanović says, the impact would be pretty devastating.

“I think if it happened, I would never use a beta release again—at least not something we use on a big scale each day,” Ivanović says. “The software we use doesn’t give out a feel that it’s in beta and has been in beta for a while—if software that’s that close to a final version fails, that will shake me.”

Should your business use beta software? There’s no hard data on the percentage of beta software versions that make it to market, so quantifying the risk is next to impossible. But “if it’s a software [product] that provides something non-existent on the market or provides a better feature set, I would use it,” Ivanović says. The potential rewards of the “perfect fit” software solution outweigh the risk of having to switch to your second-choice software in a year’s time.

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This article was underwritten by HP: Introducing HP BusinessNow, the right technology to help your business grow.