Novell Pricing Plan Will Lower License Fees for Some Customers

Novell Inc. last week announced a pricing plan across its software product lines that reduces license fees for some customers that make the software available as Web services to their customers.

The pricing plan creates two categories for user licenses, business-to-consumer and government-to-citizen, so as to make Web services more affordable to large sets of users, Novell officials said. Pricing for software made available to employees and suppliers remains the same.

The business-to-consumer license is priced at 25 percent of the standard user license, while the government-to-citizen license is 10 percent of the standard license price.

Typical per-user software license models make it difficult for companies to deploy software as Web services to large numbers of users, according to officials at Novell, of Provo, Utah.

For all its software categories, Novell is charging fees based on the number of users, not on the number of devices accessing the software.

Novells move could reduce the impact of cost as a potential barrier to making software available as Web services to customers, according to Michael Hoch, an analyst at Aberdeen Group Inc.

"There are a lot of issues with pricing for outwardly facing Web services," said Hoch, in Boston. "They havent eliminated that barrier, but theyve lowered it."

While Novells new pricing structure could be helpful in spurring adoption of Web services by Novells current customers, price typically isnt the leading issue for companies adopting a Web services strategy, Hoch said.

"Pricing for Web services is less important than functionality at this point," he said. "Most customers make their decisions based on application server technology and application choices. Price is secondary."

The new pricing models are limited to Novell Corporate License Agreement and Master License Agreement customers. Customers that qualify must still pay standard license pricing for use of the software by their own employees and suppliers.

Outsourcers do not qualify for the reduced license fees.