There are many virtualization related debates underway right now (even as you read this!), but one that I recently came across seemed to stand out above the others. It was all about who should be dictating the direction software companies should take to tackle software licensing and virtualization. Treating that topic independently, there are essentially 3 players involved:
I stumbled across an interesting Gartner blog this morning that features a series of posts “SaaS vs Software” — all very interesting. In one of his more recent posts SaaS vs Software: Their Licensing Needs to be Integrated, Guy Creese (the blog’s sole contributor) begins to explore licensing. He starts by acknowledging that while everyone is talking about the need for a single platform that can run in-house or in the cloud, not a lot has been written about the growing need for a single licensing model as well. Definitely an interesting read, I recommend checking it out!
First of all, I’d promised myself I would not write about Apple just based on how popular the topic is. Obviously, I’ve broken that promise. What strikes me most though about Apple’s current success is how it seems to go against the currently espoused play-book for success. Secondly, does Apple’s focus on hardware actually result in better software development practices?
In my role I meet with many hardware and device manufacturers. One theme is very consistent: Historically, we ignored our software as it was only really there to facilitate or drive our high value hardware sales. Now though we are looking to monetize our software as we find hardware is becoming commoditized. They want help from us to help them protect, manage and deliver their software. As I mentioned, this driver is one of the most prevalent trends in our overall industry today.
A few weeks ago I tried to download a trial version of a software package from a pretty well known ISV’s website. It wasn’t a huge file and should have been a relatively quick download. Unfortunately, that wasn’t the case. After numerous attempts and spending a frustrating hour trying to download the trial, I decided to forgo the whole thing.
I’m not the first or the last person that has had this type of experience. Yet, it continues to surprise me at how little thought it seems some ISV’s put into their Electronic Software Delivery (ESD) solution. The software download process is part of the customer experience and should be treated as such by the ISV. A good experience could be the first step in a long lasting customer relationship; a bad experience may turn away the customer completely.
Let me start of by apologizing to both Apple enthusiasts, and those on the other end of the spectrum who expected this to be an discussion about the much debated iPad. It is not. While passions run high about iPad’s place in today’s market one thing is clear. Whether its time is now later is a moot point. What it does is shine yet another spotlight on the changing face of technology. The iPad builds on momentum created by the iPhone that is dramatically effecting how we consume technology.
So what does all this have to do with licensing. The new workforce is comprised of a generation that cannot live within the strict boundaries traditionally defined by IT. They also see the unprecedented access afforded by applications like iTunes as something expected, rather than their predecessors, that still struggle with the piracy implications. They expect their software to be consumed in the manner most convenient to them, be it the home laptop, iPhone or iPad. Ask yourself how often you’ve wanted to access your favorite on-line service and just assumed that there must be “an app for that”. I have iPhone apps for most of the web applications for which I used to use my laptop (hurry up United, you’re lagging).
At a recent event for SafeNet Amy Konary made an interesting comment based on analysis performed by IDC. On average end users of enterprise software felt as though they utilized only 30% or so of the availability of that application. That is, they were not getting benefit from up to 70% of the software’s features and functionality. (Amy please forgive me if I don’t have those %’s exactly right but it was in that range) The conclusion reached from this observation is that software should be better dissected so that people only pay for the pieces they want.
The conclusion seems logical enough but I’ve struggled with it ever since. Firstly, if it’s true, why have rational economic buyers still purchased software en masse? Many financial analysts believe that software spending was one of the first sectors to bounce back from the recent economic turmoil.Secondly, are there any other normally functioning markets that have similar traits? Lastly, why do end users on average only use 30% of the available capabilities?