Software Licensing – Pricing the Concurrent License

The most predominant software licensing metrics used today for most enterprise software are either a named-user or machine-locked license. With the named user license metric, fees are applied typically by the name and role of the user accessing a set of software functions. This is often used with enterprise CRM or ERP software. With the machine-locked license, fees are applied based upon usage on a particular machine. These metrics are typically …

July 20, 2010 Cris Wendt

Governance for Effective Software Licensing

As an extension to last week’s topic of software license policies, is the topic of licensing governance. “Licensing Governance” is the effective management alignment of all licensing (and perhaps pricing) activities across and ISV’s or device manufacturer’s organization structure. Software licensing solutions have a significant cross functional impact to any organization. What we see is that the deployment of effecti…

April 29, 2010 Cris Wendt

Software Licensing – What are the Best License Metrics for a Virtual Machine World?

One of the most important decisions that a software product manager will have to make is which software licensing metric to choose when developing a software licensing model. To help understand which metrics are best for your software in light of virtualization, it’s good to provide a little background on license metrics, the value of virtualization, and the software stack. What is a License Metric and Why It’s Important The license metric is the…

March 31, 2010 Cris Wendt

Floating Software Licensing 2.0 – Virtual Machines & Cloud Computing

Software licensing models evolved in the 1990’s with the emergence of the floating license model, a model still in wide scale use today, largely in technical software markets.  At the time, the floating license model was an evolution of machine-locked software that was prevailing on standalone or lightly-networked personal computers.  Interestingly, the floating license model is taking its next evolution, with virtual machines and Cloud Computing…

March 23, 2010 Cris Wendt

To Dongle or Not What Licensing Technology is Most Effective

The interesting aspect of using dongles for software licensing is that most Independent Software Vendors view them as providing portability, not necessarily more security.  Licensing systems allow the software to attach the entitlement rights to a specific machine or user.  The core question is, how do you identify the machine and/or user in such a way that is reliable (reduces revenue leakage) but at the same time does not create a negative user…

March 18, 2010 Revenera

Thinking Pay-Per-Use Software Licensing – Consider Remix!

Usage-based software license models that are effective will tend to balance two criteria – flexibility to meet the needs of the software consumers who are using the software to accomplish a task, and predictability of costs in order to satisfy the Finance departments of both the software vendors and consumers. Usage-based software license models can be difficult to perfect because of the seeming complexity, but by balancing predictability with fl…

March 16, 2010 Cris Wendt

Don’t be Afraid of Subscription License Models

Subscription license models still seem to cause a fair amount of anxiety among customers looking into the possibility of offering such a model for their traditional software. While there are some minor variances in the interpretation of a subscription license model, it is typically defined as an annual or multi-year software license that combines the right-to-use the software with the rights to obtain software updates and service. At the end of t…

March 3, 2010 Cris Wendt

Combating Grey Market Abuse

One of our independent software vendor customers recently lamented, with a resigned tone, that their software products are available at a 90% discount in the Chinese grey market. A grey market arises whenever your products have an exploitable price differential. Grey markets are quite well-known in pharmaceuticals where prescription drugs are purchased at steep discounts in one country and sold at below-market prices in another country. They are …

February 10, 2010 Revenera

The Myths of Pay-Per-Use Software Licensing & Pricing Models

A lot is being written about the eminent arrival of pay-per-use license models and how it will change the software licensing and pricing landscape. In fact, a lot has been written about the arrival pay-per-use models since the 1990’s. Nothing could be closer to the truth, yet farther away from the truth. Pay-per-use provides an intriguing and common value proposition to provide flexibility – pay for only what you use: eliminate the large up-front…

January 27, 2010 Cris Wendt

The A, B, C’s of Software License Compliance and Enforcement

Sometimes the topics of software license compliance and enforcement seem twisted, very much like one of those M.C Escher drawings popular in the 70’s and 80’s that show complex physical objects connected in impossible ways though the optical illusions created by his drawings. To this end, I thought a few blogs on the subjects of enforcement and compliance would be useful and interesting topics. Let’s start with some basic definitions: software li…

October 28, 2009 Cris Wendt