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No matter what, all software and applications have a license attached to them. Even free software has some form of license. There are far too many different licensing models currently on the market, each with different terms and conditions that the licensee needs to adhere to. We all know what happens if you break those terms and conditions, auditors can end up fining the organisation large sums of money.
There is a number of different software licensing models currently offered by software vendors, including a number of emergent models that were not around in the licensing world ten years ago.
Based on the top ten vendors by revenue for the previous financial year, here are the licensing models available for their applications. This will give us a good indication as to what the most popular license metrics are, and also help us predict trends in the licensing market:
* Oracle ‘Developer License’
** Oracle’s ‘Update subscription service’. Still counts as a license!
+ Whilst the vendors may not provide subscription licensing, they do provide subscriptions to maintenance and other services.
Software licensing trends have shifted recently, away from the popular device and user based model to a subscription-based model. In the 1990’s and the 2000’s the predominate method of software licensing was user and device based licensing for desktops, and less complex licenses for servers. A number of vendors still provide user or device based licensing, but they have evolved their license metrics to make them more complicated and to generate bigger revenues.
|License Type||% In use by top 10 vendors|
Subscription user and device based licensing are the most common ways to license desktop applications. Vendors have leaned more towards the user subscription model in an effort to combat software piracy, to generate more income and also to ensure that users are using the latest version of their products. Unsurprisingly, within the datacentre environment the most popular licensing metrics are by Core or Processor.
With recent trends in software licensing it appears that cloud based subscription licensing will be the most popular method of licensing software in the future. A number of Tier 1 vendors have already moved to either a subscription license model, or a cloud based subscription model. Whilst this license metric is fantastic for home use and the general public, for organisations it will be more expensive and harder to manage.
Another license metric that is coming to the forefront is the idea of ‘cloud credits’. This is when an organisation purchases a number of credits. These credits are then used like a concurrent license, with a set number of ‘credits’ checked out when someone uses a certain application. These credits are reset every 24 hours for some vendors, but returned to the pool immediately for others. This is obviously a new license model, so it needs to gain maturity. This will happen over time if the vendors think it is successful.
Unfortunately, a number of software vendors do not provide such a service and they end up leaving their customers confused and out of pocket. This also results in a breakdown in the relationship between the end user and the software vendor, thus damaging the likelihood of any future business or relationship.
There is an obvious need to provide a better education around software licensing metrics, and for vendors to make their licensing easier to understand. That’s why bodies such as the Campaign for Clear Licensing is so important in helping make licensing less complicated.
This is an ‘active’ blog, so have your say! Disagree with our list of top licensing models? Have your say and get in touch!