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Enterprise Software Licensing in the World of Cloud Subscription Business Model


Imagine calling your local power utility company in order to start service at your new home. Now imagine being quoted a price not in kWh, but rather in how many rooms in your house or how many people live in the house, or if you’re willing to build a moat between the family room and kitchen. That’s the reality corporations are dealing with today when attempting to purchase enterprise applications, including database. More often they’re asked for named users, core count or the type of “trusted” partition they are planning on using, rather than how much of our service will you use at the end of the month.

Now imagine the alternative. An on-premise RDBMS solution offered as part of a PaaS, that’s priced on actual utilization rather than the best price you were able to negotiate 18 months ago. Rather than have 2 different pricing models (on-premise and public), corporation should stop enabling this 2 tiered approach of running workloads.

Lines of business should encourage both their internal IT organization and technology vendors to move towards a charge back, metering and auto provisioning paradigm of utilizing software. And stop enabling the antiquated licensing model of charging for what you MAY use, rather than charge for what you actually use regardless where that application resides.

The cloud will inevitably force software vendors to merge on-premise and public and offer a simple subscription model for both. Well… at least we can hope…..

For our part, TmaxSoft’s RDBMS solution Tibero tries to bridge that pricing model by licensing our product around the realities of virtualized servers. To continue the room/core analogy, we will only charge for the rooms that are being heated and not the whole house. Therefore, we only license for the cores associated with a particular VM rather than most RDBMS providers, that charge for 100% of the cores regardless of how many are actually used…unless you decide to use their “trusted” partition…. How convenient… for them.

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