(Not parent but I have experience from both sides: I regularly purchase five-figure software licenses for my clients, and help clients optimize their own pricing.)

It's about trust and expectations.

If a software company blindsides me with a 1,000% price increase overnight (or ∞%) without advance warning, then how can I trust them to warn me in advance about other major changes in the future? If they don't have the decency to give advance notice about that, can I trust them to give me advance warning before they change major features, or plan to have downtime, or plan to shut down--which becomes a real concern if they're fumbling around with pricing changes.

SSO and access management services are things I want to have zero nagging concerns or doubts about. Anything that shakes my trust in those services is enough to make me consider other options.

Its this, it was a trust thing. Logmein as a company always behaved very strangely. They were very opaque about their roadmap, upcoming pricing changes etc. Where-as other companies have slowly transitioned free users to paid it was extremely sudden with Logmein. We did actually stick with them when it first moved away from being 100% free but then a year later they really ratcheted up the cost, again with no warning.

I think the 'overnight' part is key here. I can easily get approval for 20k-100k in necessary software but the approval process can take 1-3 months. If a free service suddenly goes paid without notice, it is much more disruptive than waiting 2mo to start with a new paid service.

Exactly. Big companies move slowly. A small, well-funded company may be able to approve an X-thousand-dollar payment in a matter of days, but a large company just can't react that fast. There are too many layers of process and approvals and vetting and negotiation to wade through.

Companies will pay money for software, but they are risk adverse and being inconsistent (e.g. large immediate price increase) will make them switch unless they are currently stuck with your product (e.g. Oracle).

No one likes going into another budget meeting because some vendor didn't give you warning and you need to adjust in the current fiscal year. Your company will be remembered and not in a good way. If you sell software to businesses you really, really need to understand corporate budgeting and the process they go through. Heck, if you sell to Federal (US) entities you better know the significance of October and schedule accordingly.

Windows itself costs $200 or so. LogMeIn isn't worth 5 times as much as the operating system. At that price, it very quickly becomes cheaper to investigate alternatives like just using a Linux machine where remote management is a breeze, and there are tons of high-quality, free tools (with optional paid support contracts that are very inexpensive by comparison.)

Although I agree with your statement of value, it should be noted that Windows does not cost companies $200. Microsoft has a much lower per seat number that most companies pay.

Take a look at the pricing for Jetbrains products. 500€ for the first year only. I'm sure it has some features above "vim with syntax highlighting" but I can't tell which one costs 500.

JetBrains's ReSharper and their Rider IDE are both excellent products and do a ton more than just "vim with syntax highlighting".

ReSharper alone would easily save me that much per year in productivity gains.

I moved over to Ubuntu from Windows, so picking up Rider as my replacement for Visual Studio was well worth it - and at about 1/3 of the price of Visual Studio alone (and having the ReSharper features built in) it was a bargain.

The nice thing about their pricing is that it gets cheaper in the the second year and then again the third year. So from the third year on it's only 389 euro/year for the toolbox bundle that includes all products, so you'll be set for tools tools for any mainstream language.

Yeah, 900€ just for two years is nothing. And this is just for the IntelliJ IDEA, not the whole pack. The standalone Office suite is 650€ for life. Photoshop from Adobe is quite a lot cheaper (some variant goes for $120/yr).

Sometimes "free" is the maximum the budget will allow. Sometimes it's just about feeling you're been ripped off with a bait & switch.

they're infamous on /r/sysadmin for having a relatively normal price, then suddenly going up 3-400% with little notice. It's not easy to lift and shift this quickly so some companies have been forced into getting hosed for a year.

Because people never like to pay more for something that was free... Also makes accounting mad