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Software Monetization and the Cloud - Compliance is Key

September 08, 2014

There are two very hot topics in the areas of software security and software monetization and they happen to use the same terminology even if they do not apply precisely to the same things. The terms are “visibility’ and “compliance.”

When it comes to security in general, as the headlines seem to scream on a daily basis, IT departments in organizations large and small need total visibility over all of the potential vectors of vulnerability; and for not just security purposes, but for adherence to mandates and other corporate governance issues,  auditable compliance records are mandatory. In fact, as security solutions provider SafeNet (News - Alert) says this means having a centrally controlled data compliance infrastructure

For Independent Software Publishers (ISVs) and the monetization of their offerings, as more and more of them make the move to the cloud, need visibility on a granular basis in real-time over who is using their products and services, when, where, why, how, etc.  And, they need this information to ensure that the users of their intellectual property (IP) are in compliance with the terms and conditions of their licenses. Here again, SafeNet is at the forefront of providing solutions that are setting the standard for achieving maximum visibility and compliance.

In the process, ISVs are benefitting not only in terms of compliance, but by obtaining valuable business intelligence that enables them to be more responsive from a packaging and business model perspective to their customers. In turn, their customers are in a position to only pay for what they need and use. It is a real win/win.

I recently had the opportunity of discussing the impact of the cloud and the way in which ISVs are leveraging it with Kapil Digani, Senior Product Manager, SafeNet. His insights were extremely instructive.

TMCnet: How has the move to the cloud been beneficial to ISVs?

Digani: While it is taking some time, the move for ISVs from on-premises solutions to the cloud and from perpetual licenses to Software as a Service (SaaS (News - Alert)) subscriptions is gathering momentum. This is driven by two factors: what customers and/or competition are demanding, and the need for ISVs to expand their reach to new segments. This is a very strong trend, and it is only going to pick up speed since the cloud enables customers to consume software according to their needs, and for ISVs to better monitor and police their businesses.

TMCnet: Are there things to look out for when making the transition to the cloud?

Digani: The short answer is yes. However, the challenges can be turned into opportunities if licensing and software monetization are done properly such as with our market leading Sentinel solutions portfolio.  Realities are that the move is not without enforcement and compliance challenges. Virtualization makes it easy to clone machine images containing licensed software. This can lead to customers, whether intentionally to bypass paying more, or also unintentionally, to use cloning that then creates both vendor/customer contention and preventable revenue leakage. 

TMCnet: So what are the ISVs to do to assure compliance and optimal results?

Digani: Some history is useful since it speaks to both the problem and the solution. Historically, a software license has resided on a machine image that can be cloned and not easily tracked. This was good for ISVs since they could prevent their software from running in virtual environments, but is increasingly bad for business as more and more things get virtualized and moved to the cloud.

What Sentinel does as a cloud licensing solution is eliminate this issue by moving the license from the local machine or local network license manager to the cloud. This means the service can manage the licenses remotely including legacy on-premises ones.

A real benefit here is that thanks to alerts and notifications enforcing licensing has also become about compliance. For example, licenses are obtained on an as needed basis and are time limited. This means even in the worst case of cloning only a small time slice of the license gets cloned, which must then be refreshed periodically. Request for refresh is granted or denied based on the license terms which become part of the cost of the true consumption of license. In addition, with the remote control capabilities, licenses can be revoked in a matter of minutes for serious offenders preventing any further usage of the software.

Solutions like Sentinel also offer metered models, i.e. prepaid and postpaid. This means there is no need for node-locking and customers are charged based on the actual usage. The best part is that the number of cloned instances doesn’t lead to loss of compliance as usage is always reported.

TMCnet: Those notifications and reports are critical when it comes to compliance, but as you mentioned they also provide additional value added for ISVs and user alike. How so?

Digani: The good news is that the ability to track and analyze usage gives ISVs and their customers a real understanding of what is being used, by whom, how, how often, and where.  As I mentioned at the beginning, separating the license from the machine and making licensing user-centric is the secret here.

This comprehensive view is valuable information for ISVs in terms of product planning. Customers obtain vital information on what they have and how it is being used which also is critical in their planning as well.

At the end of the day, this increased visibility across their entire customer base  not only gives ISVs and customers important usage insights, but it also means they can reduce the cost to track and enforce compliance through one central platform. In short, as I said earlier this is a real win/win. Better compliance and monetization for ISVs and visibility for customers about managing their software resources.

Edited by Maurice Nagle
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