July 07 Reprise Newsletter

"Options"
The Software Licensing Newsletter

Reprise Software

September 2007

In This Issue

Pay per Use Licensing

What End-Users Want

The Truth about Switching

For Back Issues of "Options" please click here

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The September issue of Options, the Software Licensing Newsletter from the folks at Reprise Software, is chock full of new and interesting topics. We hope you find this issue useful and informative. Please feel free to forward this to a friend using the link at the bottom of the page.

Thanks.

Pay-Per-Use Licensing

The RLM Usage Reportlog and License Tracker Toolset

An interview with Rick Ingram, President of License Tracker, a Reprise Software partner, focusing on the use of software licensing to enable a comprehensive pay per use sales model.

Options: Rick, how would you define Pay-Per-Use?:

Mr. Rick Ingram: Pay-Per-Use Licensing (or PPU) is the scenario in which software publishers provide customers with copies of software for which they have not purchased traditional perpetual or annual licenses. Vendors periodically charge the customer an amount based on their actual usage of the software.

Options: When should vendors consider offering PPU?:

Rick: The two main uses of PPU licensing are satisfying peak period needs and new technology evaluations. Other imaginative uses of this technique include providing smaller customers with occasional access to expensive tools.

Options: What are the customers' needs?:

Rick: Customers need to be able to monitor their costs to ensure budgets are being maintained and to fairly divide PPU costs among business units. They need an open logfile that can be processed to provide complete, accurate and timely usage information; they also need tools to help compare actual PPU costs to PPU budgets as well as to help understand who within their organization is consuming the technology.

Options: What are the ISV's needs?:

Rick: ISVs also need a logfile that provides them with accurate and complete usage information. Further, in order to be able to offer PPU to all of their customers, they need this logfile to be secure, or at least to have a mechanism to provide assurance that it is complete and has not been modified. The encrypted digest records in the RLM logfile and the logfile validator provide this security while at the same time leaving the logfile as plain text for processing by tools such as License Tracker.

Options: Where does the License Tracker toolset fit in?:

Rick: License Tracker, together with the RLM usage reportlog and its validator, provides a complete PPU reporting and analysis solution for both ISVs and their customers. License Tracker imports the RLM usage reportlog, and then together with support files (the License Model, the User Model and the Budget Model), enables the understanding of how much software (and of what value) has been used and by whom.

The License Model lets the financial terms of the arrangement be specified; such as how many licenses of each feature are owned, the rental period (hourly, daily, monthly, etc.) as well as the rental rate. From this License Tracker can report precisely when non-owned licenses were in use and can calculate PPU invoice amounts.

The Budget Model lets customers specify their planned PPU expenditures. From this License Tracker can prepare budget vs. actual reports as well as automated alerts when a certain percentage of the budget has been reached during a period.

The User Model lets customers perform business unit analysis and cost splitting. Sometimes this information also needs to be provided to the ISV so that they can calculate revenue sharing between offices for global customers.

Options: Do you have any final thoughts?:

Rick: PPU licensing provides a win-win scenario for ISVs and their customers to increase software usage with minimal financial risk. The RLM usage reportlog together with the License Tracker toolset provides the most complete, reliable and easy to use system for implementing, monitoring and administering a PPU relationship.

Options: Thank you, Rick.

For more information on License Tracker's Pay-Per-Use solutions, please click here.

If you would like to understand the data format of the RLM usage reportlog, please click here to consult the on-line RLM End User Manual (Appendix A).

What do End-Users Really Want Now?

End-Users Drive Software Licensing Innovation

From the early days of network computing, users of high-value software urged their vendors to provide innovative licensing models that matched the way they used their software. They wanted low-cost licenses that were restricted to heavy users, and were willing to a pay higher price per license for the added convenience and utility of floating licenses that could be shared among more infrequent users on the network. Vendors responded by implementing a software license manager that offered a menu of license choices allowing the customer to decide which license model or collection of models best fit their overall usage profile.

Vendors Reap Benefits from Software Licensing

Software vendors benefited from these trends by winning deals in situations where the customer previously would not have purchased. Vendors have been able to collect more revenue than ever because they no longer have to offer discounts for infrequent-user licenses. Instead they can accommodate each user type with a license that grants the appropriate usage rights at the right price. Graphically, you can see the benefit of multiple price points - increasing the area covered under the qty/price curve. That area represents revenue.

The Big "But" - End-Users are Still Pushing the Envelope, but is anybody listening?

Today, users are hungry for more. They are frustrated by excessively high prices from the dominant legacy software licensing vendors who restrict access to software usage data - data that users see as their own - not the application vendor's data and certainly not the licensing vendor's data.

Users are often confused by mysterious license policies imposed by their application vendors, the details of which are hidden from them within a "catch-all" license keyword.

What's more, users still complain about how difficult it is to maximize license utilization across their enterprise and to fine-tune access to various groups or locales. They say that some applications don't even bother to search all available license servers before they report that all the licenses are in use, leaving some very expensive licenses idle and unused.

End Users want More Control, Transparency and Freedom!

Today, users really want:

Better control over when/where/which users can access software assets

Unfettered access to usage data and tools to track and allocate costs

Improved license administration tools

More predictable and consistent licensing models across vendors

Transparent policy spelled out in the license key

Auto-maximized license utilization

Better control over license queuing

Better performance measurement tools to plan for and deploy new licensed applications

Simpler Internet-based activation and license installation

Which Licensing Vendor will help me to address these additional demands?

When Reprise Software entered the license management business in 2006, we combined our knowledge of managing the FLEXlm business with new information that we gleaned from the end-user base to create a new open and innovative solution to the current licensing problems. The Reprise License Manager (RLM) was born.

The majority of the innovations in RLM are in support of better value for end users while simplifying implementation and deployment for vendors.

RLM addresses current and future needs by innovating on top of ideas that worked well in the past. It is designed for software vendors of all sizes who are looking to upgrade from their current licensing system (in-house or legacy vendor) as a way to increase end-user value through the use of new innovative licensing models and long overdue license administration functionality.

Please click here for information more about Reprise Software's RLM.

Switching License Managers
Accelerating the Promise of RLM

As Independent Software Vendors (ISVs) continue to adopt RLM in increasing numbers, we're asked to provide advice on how to optimize the process, helping to ensure a smooth transition from another technology to RLM.

Correspondingly, we've also solicited our customers for their feedback about the process, and how we can help make it better.

Below is some of our collected wisdom on the subject of switching license management technologies.

You have a Range of Options

Just as ISVs have choices when deciding which license model to go to market with, there are a range of transition strategies from which to choose to move to RLM. The variables involved include the number of licenses already installed in the field, the frequency with which you've upgraded licensing in the past and the complexity of your product line.

We've had customers switch out their legacy license manager and ship product with RLM in a matter of weeks. Similarly, plans to move a complex product line with a significant installed base can take months just to get the plans in place to properly make the switch. But the truth is, there's no one "right" way to move to RLM.

It's Not as Scary as you Thought--Really

Probably the first thing we're asked when talking to ISVs is "how do I make the transition?" While this is certainly a valid question and something that needs to be done correctly, it needn't take on mythic proportions. After seeing customer after customer switch, what we can confidently say is, "it can be done and it's probably not as scary as you might think."

Some Technical Details

First off, there's nothing preventing an ISV from adding RLM to whatever existing licensing scheme may already be in place. Simply check first for an RLM license; if RLM licenses are not installed, the product can behave as it does already. RLM can peacefully coexist with whatever technology is already there. Regarding license servers and client-server communication, again, there should be no issues with all technologies living on the end user's network in harmony.

In fact, RLM can detect the presence of a FLEXlm lock file and use that knowledge to prevent doubling the end user's licenses--one (existing) set licensed with the old technology and another (duplicate) set licensed via RLM. Since only one or the other server can run at the same time, only 100% of the end users' licenses can be served. This strategy can be the basis of a technical transition plan to RLM.

One way to look at a transition to RLM is that it's much like an upgrade to whatever existing license management technology you may be using today: you've had to ship updates before. Apply those procedures but simply include RLM-licensed binaries (and servers if necessary).

The Sales Pitch (Or, Why We Really Think You Should Do This)

We wouldn't be here explaining how to move to RLM, and you likely wouldn't be reading, if there weren't benefits for both sides. As we work to build a solid product, company and brand, we're quite aware that we need to bring something extra to the table to be worth your time. So what is it that we bring? Probably the best way to summarize that is, "experience." Software licensing may appear initially quite simple. Trivial, in fact. However, after nearly 50 years of combined experience in the licensing industry, we can confidently say that while licensing may appear to be pretty simple 95+% of the time, it's that 5% of the time that will make you comfortable that you have a team like Reprise and a product like RLM behind you.

Technologies, hardware/software platforms and business models change with time, and we're right there, days or weeks, not quarters or years, away from supporting that latest "gotta have it". We're here to help debug problems and turn around fixes, not just acknowledge the question, in days.

Ideally, software licensing works well, mostly in the background, helping keep everyone honest, improving revenue and not getting in the way. But as we all know, with computers comes the capability to break things at nearly the speed of light. When those occasional but critical problems do happen, we'll be here to help. Planning and executing a smooth transition from a legacy license manager to RLM is the best way to get started towards making things better for ISVs and their users.

Please contact us to explore how your company could switch to RLM.

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