Licensing is a unique experience for every organization, with distinctive business goals and custom business process. More often than not, the challenge to making licensing work is far from a technical problem; it is a business integration or project management problem. To be successful, software publishers need to adopt a top down approach: defining their software licensing vision and then fine-tuning their license enforcement and management processes and technologies. Consensus must be built, processes must be defined and technology must be aligned with these objectives. This is where I come in. With over 18 years of experience building, managing, and evolving some of the world’s most complex licensing ecosystems the least I can do is share some of what I have learned!
Most of us see ‘software entitlement’ and think it’s just a ‘nice to have’ option. You know what else is ‘nice to have’ and ‘keep’ – customers. And we all know retaining customers is much more cost-effective than continually having to acquire them.
Just like a customer loyalty program, software entitlement provides data to better understand your customers. In turn, allowing you to offer customers targeted, high interest, high value packages that are easy to obtain and consume.
At the highest level, there are two core ways issues with service agreement compliance will end up costing you, the service provider, a significant amount of money:
I don’t have many pet peeves in life. Okay, my kids will tell you I’m the typical dad who gets irritated when they leave the lights on in their rooms and monkey with the thermostat. But besides that, I roll with things pretty well.
Then comes perhaps my only work-related peeve: the misuse of the term “license”. I am sure it stems from my IBM days where teams of gifted lawyers spend oodles of cycles slicing, dicing, chopping and julienning seemingly simple concepts and produce software license agreements of Tolstoyian proportions.
Often when talking to customers I find the conversation of licensing focused solely on ensuring compliance – that is to say, making sure that their customers don’t run afoul of their license agreement. That’s like buying a Ferrari and never getting out of 1st gear. Business intelligence is one of many over looked major benefits of a properly configured licensing and entitlement management system. Most would agree that reports from ERP systems are generally not flexible enough nor tailored enough to give Product Managers the information necessary to make intelligent decisions around the future of their product roadmap and packaging strategies. To fully realize the potential of your licensing system it is important to remember the business benefits of tracking the customer use of the license. At a basic level, as a product manager, I want a licensing system to provide me the necessary information to make these decisions:
I have spent the last couple of decades working for (not just with) major ISVs as the person responsible for “making it all work”. I was the guy the executive team tasked with putting a plan together that showed how we could protect our revenue stream, how we could give customers tools to keep themselves compliant, how we could get better insight into understanding our customers’ product deployment patterns, selecting the right licensing models and policies, selecting the right licensing technology and vendor… all while somehow engineering a good customer experience without upsetting the apple cart. Sound familiar?
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).
As the head of new product development at SafeNet one of my key areas of focus is around bringing to market the types of tools and services ISVs need to help them manage the shift to the cloud – as you can imagine this means that I spend a lot of my time keeping an eye on what the industry is buzzing about!