A software licensing solution allows companies that write, publish and sell software applications to easily issue, manage and revoke the licenses that they provide to their customers.
The aim of this article is to define what software licensing solutions are and what they should be able to do in the modern online world. We'll first look at what licensing solutions are used for and then compare traditional solutions to more modern ones.
What Does a Software Licensing Solution Do?
A software licensing solution enables an independent software vendor (ISV) to license the application it has developed to their customer on specific business terms.
The software licensing solution is used to ensure that the application can then only be used by the customer on those specific license terms.
Examples of How a Licensing Solution Works
For example, if a customer has purchased a license for 30 days of access to a web-based application for one person, the software licensing solution is used by the provider of that application to ensure that only this person can access the application for that specific period of time only.
It then ensures that after the 30 days have passed, access to the application is no longer granted.
A similar, but more complex scenario might be a customer that has bought 5 seats to a desktop application on a floating license basis for use across 15 of its employees.
The software licensing solution would ensure that only 5 of the 15 employees would be able to access the software application at any one time.
This is one example of how a licensing solution works when used to enforce a floating license model, irrespective of application type. It can be used for desktop applications, web applications, mobile applications, virtual machines and even APIs.
Lots of Manual Processes
Here’s where the problems begin. Most of them are related to manual processes you (and your customer!) need to go through in order to ensure you’re getting paid for the licenses you’ve sold and your customers have access to the product.
In other words, there is no single source of truth with regards to license usage, and the following issues stem from this main problem.
It’s unlikely that you would have a MAC address, dongle or email address to tie the rights and entitlements to at the outset. So when you eventually obtain this information your spreadsheets and CRM system will need to be updated with the unique identifiers.
You’ll also need to update your database every time the rights and entitlements of your customers change.
In the long run, this approach does not scale.
…and You Still Don’t Know For Sure Who’s Using What
If your end-user decommissions a piece of hardware and wants to switch the entitlements from a decommissioned MAC address to a new MAC address, there’s no way to reliably destroy prior access rights.
Software vendors simply have to trust that end users are not using license keys on decommissioned machines and only using them on the new ones.
This is because there isn’t really a concept of a user identity in the system.
The inability to reliably rescind usage rights is a huge problem with traditional licensing solutions.
10Duke Enterprise overcomes all of the headaches associated with traditional software licensing solutions
As well as reducing infrastructure and costs, it’s infinitely scalable and will allow you to confidently grow your business and offer a world-class software service to your customers.
You can learn more about 10Duke Enterprise here, or you can watch the video below to learn the basics.