What are some new opportunities for monetization using licensing technology?

  • Capture otherwise-inaccessible customer segments through the use of multiple pricing models, each tailored to a unique market segment. Simple example: suppose you market high-end tax preparation software to large accounting firms. Because of your single pricing option, your customer segment is limited. By augmenting your licensing model with subscription licensing and utility pricing, you can now market the same software with multiple pricing options: (a) a fixed perpetual license for large accounting firms, (b) a monthly subscription license for small-business accountants that will use it year round, and (c) a usage-based license for tax preparers who mostly use it during tax season.
  • Capture revenue from value-added features through the use of value-weighted feature licensing. Example: suppose you market enterprise software consisting of base software and a number of modules of varying value. Instead issuing a standard floating license, you can issue a composite license consisting of a master floating license combined with weighted floating licenses for individual components such that the weight of a checkout for a component reflects its value (so an enterprise customer would need to purchase more points for it for the same number of users).
  • Capture additional revenue from cloud services by offering multiple pricing and licensing options and controlling the degree to which subscriptions can be shared among users. For example, you no longer have to sell a minimum-user count license, and you can price your service based on a combination of utility pricing and features and subscriptions.
  • Capture additional revenue from value-added features of embedded systems and hardware/software systems, through the use of feature licensing marketed as subscriptions. For example, you can price the base system according to a fixed price and charge subscription fees for enhanced features – your assembly line manufactures a single product, yielding economies of scale at the same time.
  • Define future revenue models based on insights gained into current usage of products. For example, if your licensing system tracks usage and licensing history of components of your high-end software, you can run analytics reports on your product usage in order to fine-tune your pricing model, for example to identify the smaller subset of features that can be packaged for offering to a long-tail customer segment at a lower price point.

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