Three Things to Consider Before Adopting Subscription-Based Software Resources
Subscription-based software is valuable for enterprises because it provides the flexibility to use and pay for only the technology (software, infrastructure, etc.) they need when they need it. There are obvious financial benefits to this approach but being able to quickly increase or decrease software resources to respond to changing business needs can provide a competitive advantage as well. While nearly all types of software resources can benefit from a subscription-based model, there are a few things enterprises need to think about as they look to adopting this approach:
- Conduct a software audit. This will help rationalize assets and better allocate workloads between subscription and perpetual license models to assure organizations are maximizing their use of both.
- Closely review software licensing terms. Not all software licenses will be transferable from on premise to cloud or hosted environments. Cost efficiency and flexibility benefits could erode quickly if this is the case.
- Determine how to best allocate usage between hourly and bring-your-own-license (BYOL) model. The best choice will often come down to use cases. Development, testing and temporary workloads that tend to “burst” might benefit from an hourly billing model, so that when usage reduces so does the hourly rate. BYOL might be more appropriate for a long-term project so that a company can manage its software license over an extended period of time.
As enterprise IT continues to evolve, subscription-based software licensing and on-demand consumption of hardware will be lead elements in an organization’s movement to cloud-based services. That movement will in turn drive business and IT transformation. For more information on subscription-based software resources, check out my Q&A with Verizon: The Case for Subscription-Based Software in a Virtualized World.
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Melanie Posey is research vice president of IDC's Hosting/IaaS and Managed Network Services. In this position, Ms. Posey provides analysis, forecasting, and consulting on telecom and Web hosting sector dynamics, service provider positioning, technological and business model innovation, and industry evolution. Ms. Posey is a frequent speaker at industry and client events and a widely quoted source in a variety of business publications.
