Wishful Thinking

By Jim Rapoza  |  Posted 2004-11-01 Print this article Print

But when they start saying that these licenses will eventually replace perpetual software licenses, they are most likely engaging in wishful thinking.

Now before you start sending angry responses, just let me say that I am not against subscription and utility licenses for software: For certain types of applications, they make perfect sense. One only need look at successful service-based software companies like Salesforce.com to see how well a subscription-pricing model can work and how much sense it makes for products like these. Similarly, utility computing can make very good sense for many server-based applications.

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But there are many, many applications where the most sensible and affordable pricing model is and always will be a perpetual software license. And this goes double for desktop applications. When I hear vendors of desktop applications wax poetically about utility licensing, I often want to ask just which fantasyland it is they live in.

In fact, the more I think about it, the more I believe that percentage of software offered through perpetual licenses wont go down one bit, at least not so long as customers have it as a choice.

Think about it. One argument for utility and subscription pricing is that people pay that way all the time in their everyday lives. But how much of it is done by choice?

For example, if the cable company gave people the opportunity to, say, pay a single $3,000 price and never pay again, how many customers would choose it? What if the utility companies did this? Well probably never know, although, by comparison, more people buy cars than lease them.

So to vendors I say, dont try to force your customers into license models that they dont want and that dont make sense for your product. Only use subscription and utility licenses if they make sense for your product.

Hmm. Now that I think about it, I wonder if I could charge readers a utility fee for every word they read?


Labs Director Jim Rapoza can be reached at jim_rapoza@ziffdavis.com.

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Jim Rapoza, Chief Technology Analyst, eWEEK.For nearly fifteen years, Jim Rapoza has evaluated products and technologies in almost every technology category for eWEEK. Mr RapozaÔÇÖs current technology focus is on all categories of emerging information technology though he continues to focus on core technology areas that include: content management systems, portal applications, Web publishing tools and security. Mr. Rapoza has coordinated several evaluations at enterprise organizations, including USA Today and The Prudential, to measure the capability of products and services under real-world conditions and against real-world criteria. Jim Rapoza's award-winning weekly column, Tech Directions, delves into all areas of technologies and the challenges of managing and deploying technology today.

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