SOFTWARE LICENSING

Flexera Software's Five Technology Predictions for 2013

By Rachel Ramsey, TMCnet Web Editor

2012 was a big year in technology. Tablets, smartphones, gaming consoles and even 3D printing have made their way from headlines to manufacturers’ and consumers’ hands alike throughout the year. It was also a big year for software licensing. Flexera Software, a provider of strategic solutions for Application Usage Management, had a great 2012, from the introduction of its software licensing app portal to its InstallShield 2012 becoming Microsoft’s (News - Alert) software installer of choice.

Looking forward to 2013, Mathieu Baissac, VP Product Management, Flexera, offers some insight for what 2013 has in store for technology and the software licensing industry.

First up are trust-but-verify software compliance models. Flexera’s compliance management solution supports usage-based, trust-but-verify software licensing models. The company recently partnered with Zuora (News - Alert), a provider of subscription commerce, billing and finance, to automate customer billing through integration with Z-Business, Zuora’s subscription management platform.

“As software customers are demanding different pricing and licensing models that better conform to how they actually user software – producers require better tools to manage compliance and enforcement,” explained Baissac. “Competitive pressures, increasing enterprise interest in subscription models and a desire to improve producer/customer relationships are driving growing interest in a trust-but-verify compliance approach.  Adopting a trust-but-verify approach is a particularly attractive alternative for application producers seeking to ensure the exchange of fair value in an atmosphere of trust.”

With this usage-based model, application producers and customers have access to actual customer application usage information that can be reconciled against the customer contracted entitlements. According to Baissac, the ability to get to a “single source of truth” regarding entitlements and actual usage is the foundation of a successful trust-but-verify approach. For enterprises, it enables a reduction in shelfware and makes software easier to use. For producers, it helps automate compliance and supports new licensing models such as pay-for-burst, pay-for-coverage.  Trust-but-verify applies to many types of packaged applications and SaaS (News - Alert) software, as well as devices and the embedded software they hold. 

The second prediction for 2013 is the preference for on-demand solutions will reach further into IT management market.

“We’ve already seen this in CRM and helpdesk solutions,” explained Baissac. “This trend will likely apply to software entitlement management and delivery (from vendor to their customers), software license optimization, remote monitoring and management (for traditional apps and IT operations apps -- embedded in devices).”

On-premises solutions will not go away, and in fact, some on-premises components are likely to be leveraged to offer an even better whole solution. Producers develop hybrid solutions-which have both on-premises and on-demand components.

A third prediction for 2013 is Machine to Machine (M2M) ecosystems to form around multiple anchor companies. M2M technologies connect people, devices and systems, turning machine data into actionable information for profit.

“The broader view of M2M is also known by many other terms, including the Internet of Things,” said Baissac. “We predict that processor, communications and system integrators players will be establishing partnerships in the coming year. These are organizations with great scale and much to gain by advancing the trend already underway.  Processors add the intelligence. Communications players add the transfer of information.  And system integrators already work with all the players, and generate more business with each project of this type.”

Other key components include Operating System (OS), security and policy management, or licensing.  These are needed across virtually all device types. They protect and add value beyond the basic intelligence and communications. Policy management is used to implement the business model of choice for the device and controls what features are available, or capacity limit of the device. We can see examples in many different industries, including Industrial automation, medical, networking, test and measurement, automotive, etc.

Moving from the Internet of Things, this movement is also predicted to redefine the software market. As an increasingly wide range of device and system types are becoming intelligent and connected, these devices include software to differentiate and add-value, and control the capabilities and capacity of the devices.

“Device manufacturers, therefore, are becoming software companies – and this trend will continue,” said Baissac. “Device manufacturers will start to think of their products as solutions – including a hybrid of hardware, software and licensing technology to monetize and protect the IP contained in the products.”

Building on this, a fifth prediction for 2013 is intelligent device manufacturers will start acting more like solutions providers. Software is enabling an entirely new level of flexibility to assist intelligent device manufacturers provide a broader array of solutions, while simultaneously reducing manufacturing costs.  Software combined with licensing will enable manufacturers to control features, functionality and capacity of their devices through software, thus enabling a more tailored product while reducing the number of product versions (SKUs they’ll have to monetize). Manufacturers will also be able to monetize software updates – thus enabling them to grow revenue streams from a particular hardware item without having to replace the device.

To learn more about Flexera Software, visit www.flexeraasoftware.com. As 2012 quickly comes to an end and 2013 soon begins, only time can tell how soon we will see these predictions become a reality. Stay tuned!

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