Software Vendors & Intelligent Device Manufacturers Gearing Up for the "Appification" of the Enterprise

Enterprise Application Producers Starting to Offer Task-Centric, User-Friendly Licensing Models Catering to "Consumerized" Employees According to New Flexera Software/IDC Report

ITASCA, IL--(Marketwired - November 12, 2014) - Delivering user-friendly enterprise applications to employees accustomed to, "there's an app for that," requires a ground-up rewiring of the enterprise software business model. A new Flexera Software industry report, Producers Profiting from the "Appification" of the Enterprise, prepared jointly with IDC, indicates this transformation has begun, paving the way for software vendors and intelligent device makers, including Internet of Things manufacturers, to profit from the "appification" of the enterprise.


In an "appified" enterprise, software use is task-oriented allowing employees to focus on things like sequencing a DNA molecule, executing email campaigns, or utilizing specific drone aircraft features. To profit from task-oriented apps, producers would need to alter their monetization models to focus on those task-oriented, usage-based activities. According to the Report, that's exactly what's happening. 17 percent of producers indicate that they now offer utility software licensing models -- up from 9 percent in last year's survey. And that number will grow to 23 percent over the next two years.

"As consumerization of IT gains hold within the enterprise, increasingly we're seeing business users want more flexible buying models allowing them to align cost to value," said Amy Konary, Research Vice President -- Software Licensing and Provisioning at IDC. "Usage-based licensing models give producers a new way to capture revenue from customers that want to pay based on how they're actually using an application. Offering utility licensing can supplement more traditional monetization models such as device, nodelocked, processor, core and others."

Done with Dongles, Employees Want "Click-&-Go"

According to the Report, producers are simplifying their access and activation models. In an appified enterprise, employees want app-store-like, one-click software access and activation rather than more traditional, complex license activation models like email or website activation, which require several-step processes. 44 percent of respondents, up from 29 percent in the 2012 Key Trends in Software Pricing & Licensing survey, report that they now distribute license keys/files via in-product activation -- a highly user-friendly mechanism that lets users launch a product simply.

Moreover, producers are reporting that they are doing away with cumbersome, legacy licensing technology like software dongles, which require special hardware like a USB stick, to access the software. Only 19 percent of producers report using hardware dongles as their licensing technology; down from 27 percent last year. Of the producers that indicated they're planning on using dongles over the next two years, 21 percent said their dongle use would decrease.

"The key to capturing a growing market of users who view enterprise software in a more app-centric way is to offer tailored licensing, activation and delivery models that appeal to this audience, said Mathieu Baissac, Vice President of Product Management at Flexera Software. "The challenge for producers is that it requires tremendous time, resources and money to build, manage and maintain in-house these myriad new and traditional licensing models, and track back-office customer entitlements. This is why adopting automated software monetization solutions is becoming increasingly essential for producers."


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About the 2013-2014 Key Trends in Software Pricing & Licensing Survey

The Software Producers Profiting from the "Appification" of the Enterprise Report was compiled from data from the 2013-14 Key Trends in Software Pricing and Licensing Survey. Since 2004, Flexera Software has produced the survey in conjunction with various partners. The 2013-14 Key trends in Software Pricing and Licensing survey was conducted by Flexera Software with input from IDC's Software Pricing and Licensing Research division under the direction of Amy Konary, Research Vice President -- Software Licensing and Provisioning at IDC. This annual research project looks at software licensing, pricing and enforcement trends and best practices. The survey reaches out to executives at application producers (Software vendors and intelligent device manufacturers) and executives at enterprises who use and manage software and devices. The survey is made available to the industry at large each year. In total, 1,828 respondents participated in the survey, including 430 enterprise executives and 1398 application producer executives.

About Flexera Software

Flexera Software helps application producers and enterprises increase application usage and the value they derive from their software. Our next-generation software licensing, compliance and installation solutions are essential to ensure continuous licensing compliance, optimized software investments and to future-proof businesses against the risks and costs of constantly changing technology. Over 80,000 customers turn to Flexera Software as a trusted and neutral source for the knowledge and expertise we have gained as the marketplace leader for over 20 years and for the automation and intelligence designed into our products. For more information, please go to:

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John Lipsey

Producers Profiting from the Appification of the Enterprises