Software Monetization

A transformation is taking place in the software industry. Experts agree that the number of traditional on-premise-only software vendors will continue to decrease at a rapid rate and most new software vendors coming to market will focus on building their solutions as SaaS (Software-as-a-Service) offerings. Despite this fundamental shift in the delivery of software, developers still need to pay close attention to maximizing the value of their software from both a revenue and cost perspective.

When we are kids, we rely quite a bit on trust. We trust our friends to take care of the toys we lend them, we trust adults to act fairly and we trust that people won't take advantage of us. This system works pretty well for children, it starts to fall apart in the business world. Opsview, an IT monitoring company, learned the hard way that a trust-based license model simply does not work, and the company decided to transition to a more flexible, enforceable software monetization and licensing model in order to generate and protect revenue.

In the past, many software developers saw a clear and simple path to profits: First, make a killer product, then drive down costs, and finally, sell as many units as you can. Lather, rinse and repeat. Unfortunately, this model is no longer practical in the modern, complex world of software monetization. As Amy Konary, research vice president of software licensing, provisioning and delivery at IDC pointed out in her presentation, "The New Look of Software Monetization," at Licensing Live US 2012, this is like asking someone to jump into a colorfully painted van driven by a unicorn. It may seem like a good idea at first, but down the road, you may want to jump out of the van, despite the colorful and interesting company on board.

According to some, it's quite easy to make money in the software monetization space. Simply implement a strategy that encompasses cloud, social media, mobile and big data, toss in a few more industry buzz words, and let the cash flow. Unfortunately, it's not as easy as that.

CAD/CAM/CAD developer Vero uses Safenet Dentinel RMS to accelerate and assure software monetization.

For those who follow me, you know I appreciate good marketing campaigns, and SafeNet's "Peace, Love & Licensing" is one of them. Yes, I am a sucker for 1960s nostalgia, but the entire package is well done.

SafeNet case study highlights best practices of software licensing after an acquisition.

With business value increasingly residing in software the need to protect it and intellectual property is paramount.

SafeNet addresses the challenges of having the right software monetization strategy for mobile B2B apps.

SafeNet webinar on the significance trialware for monetizing software.

The challenges to independent software vendors of implementing an optimized oftware monetization strategy.

Safenet provides tips on countering piracy threats.

As a leader in the piping and ducting systems analysis and modeling software, Applied Flow Technology (AFT) - which has nearly 1,100 customers in over 50 countries - needed to protect its software and be able to successfully perform in a competitive market at the same time.

When Prakash Panjwani started working at SafeNet more than a decade ago, he saw a high-energy management team that was poised to do great things in the information security space. And now, 10 years later, he is proud that the group has the same spirit and he is a big part of that leadership team, as a senior vice president of business operations and general manager of the software monetization division who brings both technology and sales experience to bear.

In the fast-moving world of technology, change is good. This adage is proving to be particularly relevant in the world of software licensing. Today, protecting and managing software is not just about piracy prevention and reverse engineering. It also provides a way for ISVs to manage and track customer usage.

There are as many types of independent software vendors out there as there are types of businesses. In this day and age, every company, from cartographers to car companies, from toy manufacturers to satellite operators need specialized software, and every vendor of software needs to have a strategy in place to protect precious intellectual property. That was the challenge that VSM Software, Ltd., a company that produces very specialized software indeed, was facing. Fortunately, VSM found SafeNet to help with software monetization and protection needs.

When SafeNet first entered the software monetization and licensing business nearly thirty years ago, the one and only solution to prevent piracy of software was the dongle, or hardware key. But in the three decades the company has been in business, quite a bit has changed, and SafeNet has continuously adapted its offerings to meet those evolving marketplace needs.

Today's software industry is a hugely competitive and, to be successful, software publishers need to be sure to thoroughly address all four aspects of a comprehensive software monetization strategy: packaging, control, tracking and management. One of the longest-standing obstacles facing the software industry is the concept of control.

In the earliest days of software monetization and licensing, it was all about the dongles. The first solutions to combat the threat of software piracy - the illegal copying or distribution of a company's software offerings - came in the form of hardware keys, also known as dongles. But in the past three decades, the demands of the software industry have changed quite a bit and physical solutions are not always the best fit, especially as companies move more and more of their offerings to the cloud.

As independent software vendors grow and thrive, it is not uncommon for them to face many growing pains associated with the operational processes they have built around licensing.

Software vendors (ISVs) are experts in developing specialized software for their markets. With talented engineers and developers on staff to design new features and functions as required, it's no surprise that ISVs are pre-disposed to taking a do-it-yourself approach. However, this independent mindset can lead vendors down a thorny path when it comes to building a software licensing and entitlement management solution. On its face, software licensing appears to be a fairly straight forward project -but before taking a do-it-yourself approach, vendors should understand the hidden costs involved in building homegrown solutions.

Software vendors want to protect their revenue streams but often aren't sure where to begin or how to proceed. Fortunately for these ISVs, there are third-party software monetization solutions available to protect their interests and proven best practices for implementing monetization strategies.

As previously discussed, a comprehensive software monetization strategy hinges on four key factors - how effectively a software publisher can package, control, manage, and monitor their offerings. All of the creative pricing and packing in the world won't get you anywhere if you have no way to 1.) ensure payment for products or services rendered, and 2.) protect your intellectual property from theft or manipulation. This control all boils down to how secure your code and licensing keys are from prying eyes.

In every industry, from movies to handbags to software, there are people out there who wish to make money by breaking the rules. From illegally downloading movies to selling knockoff handbags to pirating software, these individuals are willing to break the law and take what is not theirs. Back in the 1980s, the software industry began to take the problem of piracy seriously and started instituting software copy and intellectual property protection.

Sometimes actions speak louder than words, and winning a Frost & Sullivan Product Line Award is a prestigious honor for software monetization specialist SafeNet. But sometimes, words do a pretty good job of painting a clear picture of a company's success. "SafeNet dominates the software license management market today, accounting for over half of total market revenues," Frost & Sullivan analysts concluded in its report accompanying the award. "SafeNet is strategically expanding its product line to remain in a market leadership position as the market evolves."

Even though the market is ripe for independent software vendors (ISVs), today's developers face a number of key business challenges, ranging from piracy to pricing and visibility into industry needs. These software monetization barriers require unique solutions that enable ISVs to generate the most revenue from their offerings while also minimizing operating expenses. The leader in this area is software monetization specialist SafeNet, whose Sentinel software licensing solutions help vendors overcome a wide range of inherent challenges.

InfoTECH Spotlight, the leading website dedicated to information technologies, announced today that it has launched the Software Monetization Channel, sponsored by SafeNet, a worldwide leader in delivering innovative, reliable software licensing and entitlement management solutions to software, cloud service, and technology vendors, as the newest addition to its Online Community program.

A robust software monetization strategy is more important now than ever. Tighter budgets, economic uncertainly, and growing availability of low-cost niche SaaS offerings means that the ability to present customers with flexible pricing and packaging options is critical to winning new business. Equally as important is a software vendor's ability to track, control, and bill for usage of their offerings. The later is dependent on the integration and deployment of software licensing and entitlement management systems.

The software industry is not a new one, quite the contrary. The software industry is a mature one, and is ripe with competition. This, paired with the tough state of the economy, makes it more important now than ever before for software vendors to embrace a comprehensive software monetization strategy. "An effective software monetization strategy not only looks at how to generate the maximum amount of revenue, but also equally focuses on how to optimize operating costs while protecting already established revenue streams," Michelle Nerlinger, director of product marketing, SaaS & Software Monetization Solutions at SafeNet said.

The term "software monetization" on its face seems simple. In theory it describes a company's extraction of the fully-appreciated value from the software it creates and sells. However, theory and reality do not always overlap. In fact, regardless of software type, or how it is delivered into the market for commercial use, the ability to optimize the value of software products and services must address a variety of issues. These include finding solutions for anti-piracy, intellectual property protection, packaging and pricing challenges that yield the best results based on business needs and expectations.