Software Monetization Featured Article

Helping ISVs Monetize Software Through Flexible Licensing and Entitlement Management

July 31, 2014

We are only one-half the way through 2014, and already,  software licensing and entitlement management solutions are driving a major transformation in the way  software of all types is being packaged, delivered, consumed, protected and monitored.  In fact, one of the things helping give the market momentum going forward was the announcement a few weeks ago by SafeNet (News - Alert) pertaining to enhancements to its Sentinel LDK® (Licensing Development Kit) software monetization solution, which provides hardware-, software-, and cloud-based license delivery, intellectual property (IP) protection, and license management from a single platform.   

Shlomo Weiss, General Manager, Software Monetization at SafeNet, in an interview with IT Europa Editor John Garratt, at the recent at the Cloud World Forum in London, had some interesting things to say about software monetization and how enhanced licensing and entitlement management is rapidly reshaping the software business from both vendor and user perspectives.

Weiss explained that the market is heating up as the traditional type of software monetization customers, pure software companies and embedded device vendors, are seeing their businesses being transformed by rapid technologic and market changes. He noted, “All are evolving to become true software vendors as the hardware becomes commoditized. Vendors who used to approach us (SafeNet) for intellectual property protection are now adding feature based licensing and user-based services to their requirements so that they can improve their business decisions.”

While Weiss told IT Europa that there is rising demand from all parts of the ISV industry, the Internet of Things (IoT) has added fuel to the fire: “We are seeing more device vendors who had no software before – want to manage entitlements and usages, turning usage on and off, as needed.”

He went on to note, “We launched cloud 2-3 years ago focused on traditional ISVs and pure SaaS (News - Alert) companies. Now vendors are all moving to a connected environment – on premise want to offer connected services, traditional software vendors want to provide their solutions on mobile or through the cloud– commonality is connectivity, usage and tracking…It is all coming together and lines are getting blurred, from on premise to IOT.  This is a fundamental shift – it is more demanding and getting more complex and the dynamics in the market are changing.” 

In answer to the question of SafeNet’s role as an aggregator, Weiss observed that, “We are acting like one and using an ecosystem. We're open to all the different partners, we're close to Amazon WS, for example.” Plus, he added that on the billing side of things, “We help everyone see the usage and that is where we fit in. This is how the ecosystem works – we are at the core and looking at usage and licensing and the end user, helping the ISV manage the connected ecosystem.” 

The interesting thing about the new era of software monetization is that it really is a win/win for ISVs and their users. Thanks to the visibility SafeNet solutions now provide across on-premise, cloud and hybrid implementations of software, not only does the ISV know what is being used, and by who, how and when, but so do enterprise IT departments. 

Weiss explained that, “We see usage down to feature level, so some user cases are for billing, based on factors such as bandwidth, another user might want to know which functions are being used so as to decide where to focus in product development and look at how its products are used. And then product improvement and checking if an app is used at all. Picking up on the risk of churn and loss of customer, monitoring a trial or paid user.”  This is valuable and actionable insight.

The flexibility of SafeNet’s approach to software monetization was also cited by Weiss since every ISV has unique requirements as to how they are evolving their business models, and every one of their customers, while looking for better value, also do not wish to disrupt their operations as they change the ways in which they evaluate, implement, monitor and administrate their software usage.  “We're ahead of the curve and see a lot of what ISVs are building into systems, helping them navigate how they launch. In the next year we will see a lot more of this, and it will cover all parts of the business. The hype on cloud doesn't hide the traditional on-premise vendor moving to bridge to the new ideas, but they are not leaving on-premise behind. Vendors want to offer all deployment models and need a single system to manage everything,” Weiss adds.

As noted at the top, the software monetization landscape is in the midst of profound change, and the transformation creates benefits for ISVs and their customers alike.  As with all such transformations, the journey can be challenging. However, as Weiss points out, SafeNet’s goal is to help all members of its ecosystem be responsive to the increased speed at which things are changing, creating value for all concerned, and doing so in a reasoned manner that provides everyone with choices to address their specific needs, solving problems and reducing costs, as well as actually minimizing business process and personal disruptions along the way. 

Edited by Adam Brandt
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