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Software licensing lessons from 2016 for a cloudy future

by Stephen White  |  January 9, 2017  |  Comments Off on Software licensing lessons from 2016 for a cloudy future

A year of surprises and shocks is now behind us

  • With one’s sporting hat on we might consider Leicester City, the Western Bulldogs, Cronulla, the Chicago Cubs, the Cleveland Cavaliers as headline grabbing champions of the year (some more surprising than others!).
  • Politically (dare I mention them), Brexit and Trump.
  • In the world of entertainment and celebrity we lost too many a legend to mention.

But what of 2017. How much of 2016 rolls over into the new year? Which elements of 2016 represent a developing trend?

Some say that aging baby boomers, plus the degree to which popular culture took hold in the past 70 years will regrettably lead the 2016 wave of legends passing to continue into 2017.

Impacts of Brexit are still to be fully felt, although one might say (or hope) that the impact on sterling, and corresponding price increases that have followed, is potentially fulfilled.

From a sporting perspective if any of us could reliably predict the next set of long odds champions I’d be impressed. In the Premier League normal service certainly appears to have resumed with familiar names dominating the top of the table.

subscription

Software delivery models of course have been trending towards the cloud, and licensing to subscription as a result. Momentum from the provider side has been clear. Uptake on the client side continues to follow, perhaps not universally, but certainly progressively, and we would expect growth in uptake and use of IaaS, PaaS and SaaS to continue in 2017.

Coupled with cloud uptake and subscription growth lies an increasing risk of lock in, and as a consequence, price hikes, particularly for application software which the organization depends to execute operations. As an outcome of increasing application subscription costs, those charged with managing technology delivery as a consequence may increasingly feel pressure of delivering value from cloud adoption (primarily SaaS).

In 2017 and beyond, to address that challenge, SaaS adoption benefits and TCO should of course be extensively evaluated. Sourcing, procurement and SAM professionals also have a role to play in underpinning value through pursuing price caps to limit the risk and using SAM metering data to minimize negative impacts where price caps aren’t viable, weed out shelfware, create the platform for right sizing and reviewing value extracted.

For IT leaders, SAM will increasingly become — if it hasn’t already – a valuable consumption management discipline.

Happy New Year

Stephen

Category: asset-management  cloud  it-cost-optimization  licensing  

Tags: cloud  cost-optimization  licenisng  saas  software  software-asset-management  

Stephen White
Research Director
2 years at Gartner
14 years IT Industry

Stephen White is a Research Director in Gartner's IT Asset Management, Vendor Management and Procurement team, focusing on strategic licensing and negotiation strategies, asset management, and reseller engagement. Mr. White leverages his experience in software sales and consulting to assist IT leaders through his coverage of best practices in license life cycle strategy and trends, license metric and pricing practices, contract negotiations, optimizing terms and conditions, sourcing, and relationship management. Read Full Bio




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