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Software Licensing Trends: Is There a Subscription Imperative?

Published by: IDC

Published: Apr. 3, 2006 - 13 Pages


Table of Contents


IDC Opinion

In This Study

Definitions

Situation Overview

The Perpetual License

Subscription Licensing

Figure: Consideration of Subscription by Software Type

Figure: Primary Reason for Not Purchasing Via Subscription

Table: Impact of Vendor Shift Toward Subscription on the Cost of Software (% of Respondents)

Figure: Consideration of Subscription If Primary Concern Was Addressed

Future Outlook

Opportunities

Figure: Consideration of Subscription by Company Size

Strategies

Do the Research

Obtain Executive Buy-In

Implement the Necessary Technologies

Consider the Sales Force and Channel Partners

Adjust the Back Office

Run a Beta Test

Consider Revenue Recognition

Develop the Story

Essential Guidance

Learn More

Related Research

Synopsis

Abstract

This IDC study presents data from IDC's fall 2005 Software Licensing Survey, which details customer perceptions on subscription licensing. This data is provided by application type, as well as by company size. In addition, IDC provides recommendations for vendors that are considering offering a subscription licensing option for customers.

"Offering subscription licensing is one of many approaches that vendors are taking to try to improve customer satisfaction with their licensing models, increase penetration in markets where high up-front licensing costs prohibit adoption, and grow deferred revenue," said Amy Konary, program director for Software Pricing, Licensing and Delivery research at IDC. "IDC does not believe that subscription will always be the preferred model of customers by default, but in many situations, subscription will make more sense for customers and vendors."



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