Director, Software Pricing, Licensing & Delivery at IDC Research, Inc
By Timothy Chou
When I first met Amy in 1999 she was the new analyst assigned by IDC to this new area called software as a service. While she was relatively new to the analyst business it was clear that her analytical mind and critical thinking would serve her well. From those early days she’s gone on to be one of the acknowledged leaders in the area. The list of companies that have consulted with her on SaaS the wider issue of software pricing and licensing strategies is a "who's who" of established and emerging companies. Amy has also traveled around the globe, delivering keynote presentations to a wide range of audiences. If you’ve heard her you’d know that her style, her passion and her knowledge of the industry all go making her a great speaker.
Her skills have been recognized both by IDCs’s clients and IDC. In 2002 she was voted analyst of the year by the client base and in 2004 received the prestigious James Peacock Award for Research Excellence, IDC's highest research honor. I look forward to her continued contributions to the industry for years to come.
Timothy Chou is the author of “The End of Software”, based on his experiences as the President of Oracle On Demand. He is also the author of the new book “Cloud: Seven Clear Business Models”.
This IDC Study contains a five-year forcast for software maintenance revenue, Including a comparison with total software revenue. While SaaS and open source business models are gaining traction in the software industry, the traditional license/maintenance model is not going away in the foreseeable future. There are several elephants in the room, however, that threaten to make ISVs much less comfortable with their future ability to rely on maintenance revenue in the same way as they do today.
This IDC study presents IDC's recommendations for vendors that are considering offering a subscription licensing option for customers. In particular, the focus is on vendors that have historically offered perpetual licensing as their predominate approach. While the ideal time to start transitioning toward flexible licensing models like subscription was probably three to four years ago, major licensing changes within established software companies happen at a glacial pace and there is probably still time to play catch-up. The key for vendors considering making changes to their licensing approach is to focus on the needs of existing and future customers.
This IDC study presents a sizing of the opportunity in the SPLM technology Market. IDC believes that several market forces are converging that should lead to a high demand for SPLM technologies. However, economic challenges will make it difficult for this demand to be met. SPLM vendors would be wise to position their technologies in light of tangible cost savings and revenue generation opportunities.