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Gemalto research reveals rigid software licensing and delivery options are frustrating today’s enterprise users

November 2015 by Gemalto

Gemalto announced the publication of its State of Software Monetization report. Survey results reveal that enterprise software customer demands are evolving and software vendors and intelligent device manufacturers need to adopt flexible and adaptable licensing and packaging techniques in order to meet these needs and generate more revenue opportunities.

"The way that software is consumed is changing - whether users only want certain features, to use it on the device of their choice, or only want to pay for what they use," said Shlomo Weiss, Senior Vice President, Software Monetization at Gemalto. "Independent software vendors (ISVs) have to keep up with the changing demands of their customers. We see that piracy, reverse engineering, and deliberate and unintentional misuse are all still monetization concerns for ISVs. However, now more than ever, delivering software in ways that customers want to consume it is critical for creating a user experience that sells."

Expectations from ISVs are high

The research reveals that the vast majority of respondents (85%) think software vendors need to constantly adapt to evolving market needs. More specifically, 83% of enterprise respondents said that flexible software packaging and accessibility across multiple devices are extremely important to them. In addition, four out of five respondents believe that software needs to be future-proof to be successful.

ISVs face software monetization challenges

ISVs - including intelligent device manufacturers - are still finding monetizing their software challenging, especially including back office tasks and licensing enforcement. Only one in ten ISVs reported no licensing operations challenges.

Top back office issues included:
• Cost of renewing and managing licenses (87%);
• Time spent renewing and managing licenses (83%);
• Time and cost spent on non-product-related development (82%); and
• Limited visibility into how products are being used (68%).

Enterprise software users are frustrated

Enterprise software consumers expressed their frustration with traditional, rigid software licensing, packaging and delivery options. They are increasingly looking for online software delivery, metered usage and device-agnostic licensing. Only 10% of enterprise respondents claimed that their organization is not experiencing challenges with their software licenses. Among the remaining respondents, top licensing challenges included inflexible license agreements, long customer on-boarding and lost licensing keys. Top software license preferences included:
• Enterprise licenses (59%);
• Site licenses (45%); and
• Concurrent-user licenses (40%).

Licensing compliance remains a concern

Compliance - whether intentional or unintentional - is still a primary concern among ISVs. Four-fifths of ISV respondents worry about unlicensed software use, up from about three-quarters in 2012. Among unlicensed software usage, ISV respondents said that their top concerns were:
• Competitive theft of intellectual property (59%);
• Intentional licensing agreement violations (56%); and
• Software piracy (48%)

At the same time, almost half of enterprise respondents admit to being non-compliant with a software agreement. When asked about how ISVs could improve their services:

• 80% think software vendors could provide more clarity around processes/audits; and
• 72% think software vendors could improve usage tracking/audits.

Commercial software monetization solutions are worth implementing Of the enterprise users who had implemented a commercial software monetization solution, two-thirds were up and running in less than six months.




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