What is TCO (total cost of ownership)?
Total Cost of Ownership
The Total Cost of Ownership (TCO) is a financial estimate intended to help buyers and owners determine the direct and indirect costs of a product or service. It is a management accounting concept that can be used in full cost accounting. (Wikipedia).
TCO is a popular concept when it comes to comparing Software. It allows you to estimate the cost of using the OCR software and plan your automation strategy according to your possible workload and budget over time.
There are several aspects that are too circumstantial to be able to include in general cost estimates, but there are some that we know for a fact, and we can combine them in a total cost of ownership for each OCR scenario and compare them to the possible solutions on the market.
Front-End Cost
The first and most obvious element is front-end cost. This is the price that will be presented with the product, and the marketing team will be pointing towards special offers and discounts to cut it down. It is an important factor, but it is far from everything you would need to take into account. And yet, even here, there are different options. Some of the OCR solutions will offer you the “pay and forget” option of making one payment right here, right now. However, lately, the annual cost or subscription model has become more and more popular, allowing customers to spread costs over time and OCR creators to organize a steady flow of income.
Cost of Support and Maintenance
The second element of the total cost of ownership would be the cost of support and maintenance. Theoretically, it is possible to avoid this cost by organizing everything smoothly and brilliantly from the beginning and not allowing anything to interfere with the document processing. In reality, chaos and entropy will manage to sneak into even the most orderly processes, and some updates will mess with current settings; forms will change; scanners will get broken and replaced; some business decisions will change the whole process completely; and everything will need to be redesigned. In order to deal with all that, some support will be needed. It is possible to deal with everything yourself, but you would need to become an expert in many fields, and this time and effort would probably be better spent elsewhere. Some OCR solutions will include support costs in the front-end cost. But others will leave it as an optional add-on, which you may decide not to buy. Since we are looking for a longer period of time, it is most likely that some of this cost would have to be paid. Subscription pricing includes the maintenance and support in the annual fee, so that rather than a large dollar amount year one and a smaller (usually 20% of the initial purchase price) maintenance payment from year 2 onward, you pay the same amount year over over.
Volume Cost
The third element of the TCO would be a “volume” cost. This is not a specific term; this is just a category where additional costs are combined. Some OCR solutions will charge per page (at different rates based on total pages per year) for specific additional features like better handwritten recognition or cloud processing options. Server OCR solutions usually have traffic threshold costs, or sometimes divided by number of processors involved. These costs may look minor, but as time passes and the volume of documents accumulates, they may change the whole cost structure drastically.
Possible Scenarios
In order to compare OCR products let’s look at a few scenarios typically found across the industry.
Due to the fact that costs of document management automation depends heavily on the volume of documents. OCR solutions oriented for 1 million documents a year would usually cost significantly more than ones capable of processing less than 100 thousand. That is why for each scenario we will have 3 different categories of 100k documents per year, 500k documents per year and 1M documents per year. A time period of 10 years was chosen for comparison. In assessing possible future costs it is usually better to overestimate.
Total Cost of Ownership
Full Page Server OCR
Our first scenario is one of the most common practices, general Full Page Server OCR conversion. Documents being processed do not require data capture, do not have handwritten text, and do not require being sent to the cloud.
Typical features of OCR Servers
- OCR is performed in the background without a user interface
- Files are imported automatically from hot folders
- Ability to use multiple CPUs and servers for processing
- Management tools for remote administration
Let’s look at the full page server for 100,000 pages per year volume. At first glance, costs for the first year are very similar for several major products (SimpleIndex Pro with Textract Engine, OmniPage Server, and SimpleIndex Pro with FineReader), with a starting price of around $2,000. There are more budget-friendly options like FineReader Server and Cvision PDF Compressor for around $1000, and there are more expensive outliers like PaperVision Capture and Foxit/Cvision Maestro Server. However, costs are changing with time. The Cvision PDF Compressor has the least steep growth and is your most affordable option even after 10 years of use. But the costs of others are growing much more steeply. For example, the cost of OmniPage Server after 10 years overwhelms the cost of Foxit/Cvision Maestro Server and becomes the most expensive option here.
Full page server OCR for the 500,000 pages per year volume. At first glance, costs for the first year are very similar for several major products (Simpleindex Pro with Textract Engine, OmniPage Server, SimpleIndex Pro with FineReader, FineReader Server, Cvision PDF Compressor, and PaperVision Capture) in range of the starting price of 2k to 3k. SimpleIndex Pro with FineReader is the budget-friendly version. And there are more expensive outliers, like Foxit/Cvision Maestro Server. However, costs are changing with time. SimpleIndex Pro with FineReader Engine has the least steep growth and is your most affordable option even after 10 years of use. But costs of others are growing much more steeply. For example, OmniPage Server and especially FineReader Server cost after 10 years overwhelms the cost of Foxit/Cvision Maestro Server and becomes the most expensive option here.
Full page server OCR for the 1 million pages per year volume. At first glance, costs for the first year are very similar for several major products (Simpleindex Pro with Textract Engine, OmniPage Server, SimpleIndex Pro with FineReader, FineReader Server, Cvision PDF Compressor, and PaperVision Capture) in range of the starting price of 3k to 4k. SimpleIndex Pro with FineReader is the budget-friendly version. And there are more expensive outliers, like Foxit/Cvision Maestro Server. However, costs are changing with time. SimpleIndex Pro with FineReader Engine has the least steep growth and is your most affordable option even after 10 years of use. But costs of others are growing much more steeply. For example, OmniPage Server and especially FineReader Server cost after 10 years, overwhelms the cost of Foxit/Cvision Maestro Server and becomes the most expensive option here.
Invoice Processing (Full Page)
A more specialized but very common scenario is processing invoices. Invoice Processing Software uses OCR data capture technology and page layout analysis to automatically identify the common data elements in an invoice, such as vendor, date, amount, invoice number, etc. Invoice Processing applications are built using the same technology as other data extraction applications, but have been specifically configured to recognize Invoices since they are one of the most common documents that companies need to automate. In a “Full Page” scenario, we are those header elements previously mentioned and not concerning ourselves with the line item details that may be on the invoice.
Let’s look at the invoice processing (full page) for 100,000 pages per year volume. At first glance, there is one clearly more affordable product, SimpleIndex Pro with FineReader Engine, for $1620. It is followed by PaperVision Capture / Forms Magic, and FlexiCapture. But for PaperVision Capture / Forms Magic with unlimited fields, you would need to pay significantly more. The interesting part starts when we are calculating the cost further in time. Here we see that the FlexiCapture payments structure, when you have to keep buying the same product each year, increases the cost tenfold. SimpleIndex Pro with FineReader Engine remains the most affordable version.
Similar results we can see for the invoice processing (full page) for 500,000 pages per year volume. At first glance, there is one clearly more affordable product, SimpleIndex Pro with FineReader Engine, for $1620. It is followed by PaperVision Capture / Forms Magic, and FlexiCapture. But for PaperVision Capture / Forms Magic with unlimited fields, you would need to pay significantly more. The interesting part starts when we are calculating the cost over time. Here we see that the FlexiCapture payments structure, when you have to keep buying the same product each year, increases the cost tenfold. SimpleIndex Pro with FineReader Engine remains the most affordable version.
Results for the invoice processing (full page) for 1 million pages per year look similar, but there is one nuance. At first glance, there is one clearly more affordable product, SimpleIndex Pro with FineReader Engine, for $1620. It is followed by PaperVision Capture / Forms Magic, and FlexiCapture. But for PaperVision Capture / Forms Magic with unlimited fields, you would need to pay significantly more. The interesting part starts when we are calculating the cost over time. Here we see that the FlexiCapture payments structure, when you have to keep buying the same product each year, increases the cost tenfold. However, the higher costs of the unlimited version of PaperVision Capture / Forms Magic make the difference with FlexiCapture less obvious. SimpleIndex Pro with FineReader Engine remains the most affordable version.
Invoice Processing with Line Items
Our second, more specialized Invoice Processing scenario adds the ability to capture Line Item detail. As before, Invoice Processing Software uses OCR data capture technology and page layout analysis to automatically identify the common data elements in an invoice, such as vendor, date, amount, invoice number, etc., plus line details, typically arranged in a table. Invoice Processing applications are built using the same technology as other data extraction applications, but have been specifically configured to recognize invoices since they are one of the most common documents that companies need to automate. There are not many software solutions that offer to automatically identify and process line items. Usually these are enterprise level OCR solutions, or less expensive OCR offers but with additional modules allowing line item capture.
There are not that many options if you need to process a large volume of 100,000 pages per year of invoices by automatically identifying and processing line items. The most affordable solution for one year is SimpleIndex Pro, with the Textract engine. However, because the cost of invoice line item capability is high, Simpleindex stops being the most affordable after 4 years. PaperVision Capture/Forms Magic starts as the most expensive offer, but after 4 years of use, it becomes the most affordable. FlexiCapture is an enterprise-level OCR that requires enterprise-level investments, and after 3 years, it becomes the most expensive offer.
Similar results can be seen for a document volume of 500,000 pages per year. PaperVision Capture/Forms Magic starts as the most expensive offer and, in 4 years, becomes the most affordable solution. SimpleIndex and FlexiCapture may look like cost-saving options in the beginning, but in several years, their total cost of ownership increases drastically.
The same dynamic can be observed for the 1 million invoices per year category. Simpleindex Pro with Textract starts as a middle-range solution and has already, by year 2, become the most expensive one. PaperVision Capture/Forms Magic is the most expensive solution that becomes the cheapest after 10 years, but for this category, the difference with FlexiCapture is not that large. And FlexiCapture stays the most affordable until year 6.
Fixed Forms ICR
In this scenario, some or all text in the document is handwritten. Forms Processing Software uses ICR technology to automate data entry tasks involving hand-filled surveys, applications and forms. It provides interfaces for scanning, recognition, data verification and export, as well as management and monitoring tools to track large volumes of documents and data through the workflow.
Traditional forms processing relies on constrained handwriting, where boxes on the form force the filler to write with separated, printed block characters. Modern AI technology has dramatically improved the ability to recognized unconstrained handwriting and cursive script. Hand printed notes, free-form comments blocks, non-segmented fields, historic documents, and more can now be converted to text with acceptable accuracy where these were impossible just a few years ago.
Forms processing can have additional upfront costs beyond the software and its installation and setup:
- Forms may need to be redesigned for optimal recognition
- Recognition templates must be created for each data field on every type of form
- Data exports must be defined for each form template
- Labor required to verify the recognition results
All handprint recognition systems also require a per-page fee for processing, so the overall cost is proportional to the volume being processed. These typically range from $0.05 – $0.10 per page.
Here we will compare data capture solutions for documents with handwritten text in them. Let’s start with the 100,000 pages per year category. There are two obviously more affordable solutions here. There is one obviously more affordable solution here. And it is SimpleIndex Pro with FineReader. After 10 years, it looks even more affordable than its competitors. FlexiCapture starts as a middle of the price range solution but has a steep increase in total cost and becomes the most expensive by year 6. SimpleIndex Pro with Textract (it is better at ICR than FineReader) starts in the modest under 10,000 part of the chart, but Textract per page costs move it to the middle range after 3–4 years. PaperVision Capture / Forms Magic, limited to 5 fields, is a good middle-priced solution that stays reasonably priced after 10 years. The PaperVision Capture/Forms Magic Unlimited version is on the upper side of the chart.
Nothing really changes for the next volume category of 500,000 documents per year. SimpleIndex Pro with the FineReader engine has the lowest total cost of ownership value. FlexiCapture starts in the middle but becomes the most expensive after six years. Followed by SimpleIndex Pro with Textract and the PaperVision solutions staying on the expensive side.
For the enterprise level of 1 million documents per year, we can see the same dynamics, just with a more obvious difference. SimpleIndex Pro with FineReader is still the most affordable, but for this category, it is 100 times more affordable, especially in the long run. SimpleIndex Pro with the Textract engine starts very inexpensively, but by the year 7, it reaches the most expensive title. FlexiCapture starts in the middle but becomes more expensive. PaperVision solutions are staying on the expensive end. However, PaperVision Capture / Forms Magic with unlimited fields have a large total cost of ownership, staying very close to FlexiCapture.
Variable Format
This is an “All of the above” scenario. We are comparing OCR solutions with an ability to work with handwritten characters and an ability to capture data from user-defined zones on documents.
Some OCR software solutions are universally good and ready to be used in many different cases. Let’s compare variable-format systems capable of processing up to 100,000 pages per year. There is one obviously more affordable solution here. And it is SimpleIndex Pro with FineReader. After 10 years, it looks even more affordable than its competitors. FlexiCapture starts as a middle of the price range solution but has a steep increase in total cost and becomes the most expensive by year 6. SimpleIndex Pro with Textract starts in the modest under 10,000 part of the chart, but Textract per page costs move it to the middle range after 3–4 years. PaperVision Capture / Forms Magic, limited to 5 fields, is a good middle-priced solution that stays reasonably priced after 10 years. The PaperVision Capture/Forms Magic Unlimited version is on the upper side of the chart.
Nothing really changes for the next volume category of 500,000 documents per year. SimpleIndex Pro with the FineReader engine has the lowest total cost of ownership value. FlexiCapture starts in the middle but becomes the most expensive after six years. Followed by SimpleIndex Pro with Textract. And PaperVision solutions are staying on the expensive side
For the enterprise level of 1 million documents per year, we can see the same dynamics, just with a more obvious difference. SimpleIndex Pro with FineReader is still the most affordable, but for this category, it is 100 times more affordable, especially in the long run. SimpleIndex Pro with the Textract engine starts very inexpensively, but by the year 7, it reaches the most expensive title. FlexiCapture starts in the middle but becomes more expensive. And PaperVision solutions are staying on the expensive side. However, PaperVision Capture / Forms Magic with unlimited fields have a large total cost of ownership, staying very close to FlexiCapture.
Simple Software’s SimpleIndex has everything you need for document scanning, zone OCR, data validation and output to searchable PDF files, CSV or XML data, document management systems or cloud storage like SharePoint, AWS, Box and Google Drive.
The SimpleIndex document management suite includes:
- SimpleIndex comes in Standard, Barcode, OCR and Professional versions, with Server licensing available for unattended processing. FineReader OCR is included with OCR and Pro. Tesseract OCR is included with all versions. Upgraded bar code recognition and scanner drivers are included with Barcode and Pro.
- SimpleView offers folder and file based document management, OCR and editing.
- SimpleSearch uses database indexes for fast, precise document searches.
- SimpleSend automates sending of document files via secure FTP or email.
- SimpleExport converts CSV files into XML or any other text file format using XSLT.
- SimpleCoversheet creates bar code separator sheets to automate scanning and indexing.
ABBYY FlexiCapture is a powerful data capture and forms processing solution from a world-leading technology vendor. It transforms streams of documents of any structure and complexity into business-ready data. And its award-winning recognition technologies, automatic document classification, plus a highly scalable and customizable architecture, mean that it can help companies and organizations of any size to streamline their business processes, increase efficiency and reduce costs. We would recommend it as the best choice of OCR software for enterprise scale business.
Innovative server-based OCR software for performing centralized enterprise-wide OCR processing. Processor license allows anyone on the network to submit files for OCR. Complex XML job specifications can be submitted to control output. Support available for Arabic and Asian languages.
Foxit’s Maestro Server OCR converts paper and scanned documents into searchable PDF files. Engineered for automated, high-volume document scanning & OCR needs, Maestro replaces manual document processes with fast, cost-efficient operations. Maestro automates the OCR process by converting any document as it enters a watched folder according to configurable settings chosen by the user. Beyond OCR automation, Maestro incorporates unlimited multi-threading and batch OCR to accommodate high-volume scanning, up to billions of pages per year to make Maestro a robust enterprise OCR software solution.
Tungsten Kofax OmniPage Server is a robust and versatile OCR solution for server-based, large volume document conversion needs. It is a reliable high‑volume, server‑based PDF and image converter that will be useful for a large variety of your automation needs.
PaperVision Capture’s fully customizable OCR server uses a machine-based Open Text OCR license to give you incredibly fast full-text OCR capable of handling millions of pages per day without expensive click charges. It can be expanded to add powerful zone OCR and forms processing capabilities. PaperVision Capture was designed for the biggest service bureau scanning operations in the world and tackle any scanning, OCR and data capture job. Its modular licensing based on the number of capture stations gives it the best price/performance ratio for many scenarios.
Foxit PDF Compressor is an OCR server equipped with enhanced compression that can dramatically reduce the size of PDF files. This can lead to big cost savings in cloud storage and bandwidth fees, and improved efficiency for knowledge workers who save time on every file they open.
PDF Compressor uses the OmniPage OCR engine, proving incredibly fast recognition speeds and high accuracy in over 200 recognition languages.
PDF Compressor intelligently applies MRC, JPEG2000 and JBIG compression algorithms to the parts of the document that can achieve the biggest reduction from each. Color images, text and backgrounds are separated and compressed individually. Other OCR applications will only apply one compression type for the whole document, which can reduce the quality of mixed documents while it fails to achieve optimal compression.
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