In the old days, life as a software license was pretty simple and uncomplicated. An end user could purchase the software in a brick and mortar retail outlet or, in more recent times, order it online. The software would be delivered in a nice, colorful package, copied onto a CD with the license key printed on a label on the CD itself or somewhere on the packaging. All the user had to do was insert the CD into the computer and install the software via an easy wizard. The license key would be entered during the process and the software was ready to go. The end user could continue to use the software forever, with no additional costs, as long as the operating system of the computer would still support the application. The end user could also update their software along the way (for an additional fee) using a similar purchase and installation process.
Today, life as a software license is much more complicated, yet more resourceful for the end user and the software publisher. A modern software license must be secure, so that only the purchaser can use the software and the publisher won’t lose its rightful revenue; second, today’s software license must be agile and nimble to be capable of serving its end users in a variety of configurations to meet ever changing business and IT scenarios; and finally, today’s software license requires a strong manager to enable the creation of the license itself, coordinate the electronic delivery process, and manage the overall sales process.
Let’s delve a bit deeper into these three vital requirements of today’s software license.
Requirements for Modern Software Licenses
License Security
These days, software publishers have several options to protect the license from prying eyes and enable its use by only the appropriate purchaser. For example, the license can be stored in a hardware-based container in a variety of form factors, from standard USB dongles to ASICs and microSD and SD cards, whichever best suits the application environment. For added security, some dongles come with on-board smart card chips that offer a secure repository for the encryption keys associated with the software license.
Another method to secure a software license is to create a signed and encrypted license file and bind it to a digital footprint of hardware specific properties of a target device or a network server. In today’s cloud environment, the license can also be stored in the cloud and bound only to the specific end user, allowing the end user to access and employ the license from anywhere, on any device, at any time.
License Flexibility
In an ever evolving business environment with mobile users and a plethora of computer devices in which to access a software application, license flexibility is essential. While still preferred by some end users, the single use, perpetual license as described earlier, may no longer be cost effective or efficient for others. Some end-users now expect an array of licensing options beyond the traditional on-premise perpetual license, such as subscriptions and pay-per-use. The evolution of the hybrid workspace and Software-as-a-Service (SaaS) are further changing the rules for license availability and delivery. Let’s take a look at a few of today’s modern license strategies:
-
- Subscription: The software publisher specifies for how long the license is valid with autorenewal options.
-
- Pay-Per-Use: Billing is based on the number of units used.
-
- Feature-on-Demand: Individual licenses are used to activate specific product features and modules as needed.
-
- Regional License: The license can only be used in a specified geographical region (time zone).
-
- Trial/Demo: The user can only access the features of the software specified by the ISV for a limited time.
-
- Single User: The license is stored on a local PC, a local device or a dongle plugged into a local PC. The software runs on the same computer/machine/device.
-
- Network/Shared: The license is stored on a license server in the network or in the cloud.
License Management
Given the complexity and ongoing evolution of today’s business landscape, software licenses require an efficient manager to facilitate the process to create, deliver, activate, and manage entitlements for both software publishers and their end users.
License management systems are deeply intertwined with a vendor’s business process infrastructure, in their software code base and build infrastructure, as well as in the installed customer base for their products.
The three core values of robust license management solutions are:
-
- Seamless integration: Enable all license models, integrates efficiently into the existing sales process and customer management systems, and without interference with the end user quality of experience.
-
- Scalable: the license manager can evolve with market fluctuations, adapt to a growing customer base, and maintain ongoing support of its customer base, regardless of changes in the developer environment.
-
- Secure: Resilient to evolving license hacking technologies, protects licensing process and IP, and provides appropriate balance between costs and risk mitigation.
In summary, a modern software license must embody the characteristics of flexibility in license creation, delivery, activation, and entitlement management, while also having the ability to protect its intellectual property with robust anti-hacking security. Popular cloud-based technologies and modern delivery models like Software-as-a-Service (SaaS) bring even more value to the software license. All of these characteristics are sure to change in the future as consumer preferences continue to evolve over time.