Entitlement and Compliance Management

Both Publishers and Enterprises are Working Hard to Validate Software License Compliance—An In-depth Analysis of 2008, 2009 and 2011

By Mathieu Baissac

This is a continuation of my deep-dive analysis of the Flexera Software and IDC yearly software licensing survey to Enterprises and Publishers. This time I will be looking at how both Publishers and Enterprises are working hard to validate software license compliance. 

One of the questions I explored was “What are the trends around software license compliance from the Producers’ perspective” and “How does that compare with Enterprises’ perspective”.

Producers’ perspective 

	2009	2011	Delta
Provide software entitlement data over internet	20%	25%	+5%
Enterprise don’t manage software entitlements or do it manually	52%	91%	+39%
Don’t know how enterprise manage	18%	29%	+11%
Enterprises call for entitlement information	Not asked	33%

Some analysis:

1. Publishers are extremely worried that Enterprises are not tracking their own compliance
2. Publishers are setting up – by providing entitlement data over internet or via support/help desk calls
3. Simplifying their licensing models 

Enterprises’ perspective 

	2008	2011	Enterprise Delta
Using automated tools (standalone or part of asset management)	52%	65%	+13%
Are not tracking licenses	10.3%	2.1%	-8.2%
Are worried about shelfware	44%	30%	-14%
Are worried about risk of software license audit	26%	55.6%	+29.6%

 

Contrast 

• Publisherss believe that Enterprises are managing software entitlements/licenses less and less (91%) whilst Enterprises are adding automation tools (+13%)
• Enterprises are less and less worried about shelfware, and much more worried about software license audits 

I cannot explain away the difference. Any suggestions? 

Flexera Software is committed to bridging the enterprise / publisher compliance conversation.

Disconnect on Software Licensing Between Producers and Enterprises—An In-depth Analysis of 2008, 2009 and 2011

By Mathieu Baissac

Flexera Software and IDC do a yearly software licensing survey to Enterprises and Publishers. I recently completed an in-depth analysis of these surveys and will be blogging several articles on some interesting findings. I selected 3 and 4 year spans to avoid “short-term” trends.

One of the questions I explored was “What are the trends around software license enforcement from the Publishers’ perspective” and “How does that compare with Enterprises’ perspective”.

Publishers Perspective 

	2009	2011	Delta
Does not do licensing enforcement	28%	7.8%	-20.2%
Uses dongles	20%	27%	+7%
Uses internet activation	28%	48%	+20%
Uses floating licensing	28%	55%	+27%

Some analysis:

1. More enforcement is growing (none+serial only – 64% in ’09 vs. 35% in ’11 –a 45% delta)
2. Dongles are not dead—they are growing (35% growth—perhaps due to combating virtualization and more intelligent device manufacturers)
3. Ease of use is a big driver in the changes
   -Internet activation: 71% increase in 2 years
   -Floating licenses: 96% increase in 2 years

Enterprises’ Perspective 

Preferred licensing models	2008	2011	Enterprise Delta	Producer Delta	Enterprise/Producer Delta
Floating licenses	71%	48%	-23%	+27% (’09-‘11)	50%
Trust-based licensing	9%	16.3%	+7.3%	-12.2%	20%
Vendor supplied automated monitoring mechanism with annual true-up	3.8%	12.2%	+8.4%	Not asked
Dongles	2.5%	0.0%	-2.5%	+7%	9.5%
Product activation over internet	9%	22%	+13%	+20%	7%

Contrast 

• Publishers are increasing use of floating licenses but enterprises are liking them less and less
  • Root cause of this is unclear
• Publishers are increasing software licensing but Enterprises want more “trust-based licensing” or “automated monitoring with annual true-up”
  • Enterprises want the flexibility to ramp up and down licensing as their business changes
  • Publishers probably dislike that option as (a) they don’t have the tools or (b) they don’t trust enterprises to stay compliant
• Both Enterprises and Publishers like the “ease of licensing” that product activation provides

Flexera Software is working on a compliance automation solution—which we believe will significantly improve the producer/enterprise divide.

Bridging the DevOps Divide by Automating the Handshake between Dev and Ops

By Jeanne Morain

As the cloud becomes the more prevalent and preferred architecture – having a succinct, automated process between Development (Dev) and Operations (Ops)— DevOps—will be a critical success factor for IT shops.  During my research for Visible Ops Private Cloud and Client4Cloud – it became clear that IT shops that automated bad processes or did not have processes in place – only got into trouble faster.  The less process and more rigid controls IT put in place for the business the more the business would work around IT to circumvent policies that inhibited productivity.

The agility, flexibility, and dynamic nature of cloud computing provides significant ROI to the business but only if IT can create and automate processes that provide compelling value to overall productivity of the company.  As IT Ops becomes the "Cloud Broker" and is able to create virtual environments within minutes – Dev will need to automate the packaging, handoff and analysis to keep up.  One individual interviewed for Visible Ops Private Cloud indicated that although it was great that IT could  provide the virtual environment within 15 minutes it still took them over 9 days to have critical applications installed and running due to poor processes for software licensing, procurement, analytics, and change management.  (2011, ITPI)

Many senior development and operations executives I have spoken to are focused on – how to create a cloud environment that provides Infrastructure as a Service (IaaS) for the business. It became apparent during many discussions that DevOps is the next logical step.  Meaning, once the infrastructure is in place and automated – business will require IT to automate the rest of the process to reduce the overall time to value for the organization.  Successfully automating the handshake between Dev and Ops will be a critical success factor in companies realizing the true value of cloud computing.

Key elements to consider on your DevOps journey:

• Development workflow that enables collaboration across multiple geographies, groups, and departments.
• Secure source code repository with branching that also have a sound disaster recovery and security controls to reduce mistakes and malicious activities.
• Automated packaging and provisioning of applications across physical and virtual paradigms leveraging current backend systems for Asset Management, Configuration Management, Change Management, and Service Desk.
• Automated test and dev that are cloud enabled to provide both depth of scale but also ability to burst across various cloud environments.
• In depth analytics on application and feature level usage along with software license position to ensure that not only technically can you deploy in the cloud but legally should you.
• Automated software licensing handshake across hybrid clouds – also known as licensing as a service to enable lifting and shifting of workloads without the drag of manual approvals for bring your own software licensing policies of 3^rd party cloud providers.

DevOps is coming of age and will be more critical for both development and packaging moving forward.  The key is automating the handshake and processes now as part of the overall cloud implementation.

Want to learn more about DevOps…check out these upcoming events where Paul Peissner from CollabNet will share DevOps insights and how Flexera Software solutions fit within the process.

 

 

The Rise of the Machines – The Machine-to-Machine Evolution

By Tu Le

Some call it the "Internet of Things" others call it "Machine-to-Machine" and some simply call it the convergence of smart enabled devices with the Internet—whatever you call it—we are at a new inflection point of connected devices. Based on Analysys Mason forecasts (http://www.analysysmason.com/about-us/news/insight/M2M_forecast_Jan2011), within the next few years, literally billions of Internet-enabled microprocessors will provide digital intelligence and connectivity for almost every commercial and industrial product or appliance, even baby clothes (Baby clothes go high-tech: Pyjamas to monitor heart beat, temperature, movement), extending the Internet into most aspects of our lives. This reminds me of how Skynet was created. For some wondering what Skynet is – it is a fictional computer systems, part of the Terminator movie series, with highly advanced artificial intelligence built by Cyberdyne Systems to automate the first national defense network that is capable of processing information at billion or perhaps trillion of operations per seconds. In these fictional movies, everything from embedded devices to computer systems to everyday machinery that humans are dependent on are interconnected and are controlled by Skynet making itself an entity with massive power by the data that it has in its possession to control and destroy anything how it see fit.

Traditionally, old world engineered systems like appliances, vehicles, energy meters, and vending machine were not connected to anything internet or internet-like. But, these same redesigned systems are now entering into the Internet. Expanding rapidly and globally due  to the growing advancements in hardware and software components, these smart appliances and devices are becoming the "Internet of Things" and the "Machine-to-Machine Evolution". Initially and implicitly, it is not the consumers that will have the most to gain from smart enabled device networking — it's the businesses that support them. The intelligent device manufacturer of your washing machine should be interested in its operating and usage patterns. Perhaps when it breaks down it will let them know, so that they can call pro-actively to let you know that they can provide immediate service. This may sound only slightly interesting for consumers, but for business and industrial automation applications it yields several major advantages. Intelligent device manufacturers can use their connected products to develop customer service relationships that can ultimately recreate the basis of customer management and generate new software + service offerings that enable recurring software licensing revenue streams. They can use device-networking technology to reduce the hassles of product ownership, while at the same time helping their own business to reduce costs and pursue new revenue growth opportunities.

As operators and service providers upgrade their infrastructure to support the ongoing demand for bandwidth, smart enabled devices will become ubiquitous and will play a bigger role in our life – from navigation systems in our cars and phone, to remote diagnostic machines to monitor our vital signs. Smart enabled devices or machines of tomorrow will have the capabilities to communicate with each other and process real time information that will lead to more efficient business transactions and conversely making our lives easier and subsequently ever so more dependent on these devices. As more and more machines are connected to each other and are part of the central fabric of our life, one day a spark of phenomenon might eventually happen and will give life to Skynet.

The Internet of Things and Machine-to-Machine are on the Horizon—Are you Ready?

By John Lipsey

Gartner has claimed that the 'Internet of Things' is on the horizon. The 'Internet of Things' is a phrase used to describe how the internet will link traditional smart devices, and a wide range of additional physical assets to allow these endpoints to generate and share data. Nearly every product will have an IP address and communication capability – not just networking and telecommunications devices, but also industrial equipment such as buildings, medical devices, test and measurement systems, construction equipment, and oil and gas machinery, to name a few – that will link to other devices and services via the web.

This isn't blue sky thinking. In its September 2011 report entitled The Internet of Things is Coming, Gartner recommends that CIOs and IT leaders set aside two days as early as 'before mid-2012' to develop a strategy for this scenario. The trend of pervasive Internet is already gaining hold and today is described in a number of ways in different industries – Machine-to-Machine (M2M) communications, intelligent device management, telematics, telehealth and "smart" infrastructure, to give some examples. Gartner forecasts that there will be more than 30 billion permanently connected devices by 2020 and more than 200 billion intermittently connected devices by that time.

Opportunity beckons intelligent device manufacturers. They must evolve their products from fixed function and disconnected systems to flexible and seamlessly connected devices.

In this video, Steve Schmidt, Flexera Software's vice president of corporate development, talks about machine-to-machine, the Internet of Things, connected devices, and the tremendous value to consumers, and the monetization opportunities for producers.

 

Steve Schmidt, Vice President of Corporate Development, Flexera Software 

Smart Device, Smarter Services

By Bashyam Anant

My recent treadmill purchase literally drove home the point that Intelligent Device Manufacturers are fundamentally transforming themselves into software-centric, service-driven businesses.

The treadmill features a built-in Android Tablet computer.  It is connected to my home wireless network and displays the news, accesses email, lets me watch videos and more. The treadmill also connects to the manufacturer's cloud-based application. This application lets me program a workout using Google Maps. For example, I could plot a route around my neighborhood and save it in the cloud. Periodically, the treadmill connects to the cloud application, downloads the workout and programs it in with accurate details such as elevation and distance. I can also track my progress towards fitness goals by viewing my workout history with time, distance, incline, calories burned and pulse in the cloud application and also on the treadmill. I can download workouts planned by other consumers in exotic parts of the globe—the plan is rendered in the treadmill on a Google Map. The cloud application also has running events that I can compete in, in real time. I can also find a fitness coach online who can tailor a program and monitor my progress. And finally, I can also share my workout programs via Facebook or Google+.  

This example illustrates several trends we are observing in the broader Intelligent Device Manufacturer space:

• Adoption of Android well beyond mobile use cases into industrial equipment.
• Internet-enabled devices are growing as the treadmill example shows. Internet connectivity is a key enabler for several use cases including firmware updates, software updates and data upload/downloads (e.g. workout programs for the treadmill).
• Connectivity and software on devices are transforming business models. My treadmill's manufacturer has created a "hardware plus services" model since the cloud application that the treadmill connects to requires an annual subscription to give me access to my workout history and all the sharing features.
• Many devices are capable of creating an app store and partner ecosystem for manufacturers. For my treadmill, fitness professionals from anywhere in the world can work with me and get paid for their services. Likewise, many fitness apps could be developed for the treadmill ecosystem.
• Social media features are being built into devices.

What are your experiences with smart devices?

Read related blogs:

• Machine-to-Machine (M2M) Has Evolved

• Anyone for 1 quadrillion intelligent, connected devices on the Internet?

• New IDC Report Highlights How Licensing Helps Intelligent Device Manufacturers Generate Revenue from Embedded Software
  

• Intelligent Devices Proliferate Due to Abundant Processors and Embedded Software

Software Licensing Becomes Top Competitive Differentiator for ISVs

By Richard Northing

Historically, independent software vendors (ISVs) have thought of software licensing primarily as a means of protecting their intellectual property (IP) and maximizing revenue.  Effective software licensing technology, after all, is essential for ensuring that IP is not intentionally or unintentionally used in a way that violates contracts.  The right software licensing structure can also help ensure that ISVs receive incremental added revenue for incremental added value.  Neither of these software licensing value propositions is going away any time soon. 

As enterprise technology environments enter a new transformative period characterized by the adoption of virtualization and the cloud, however, software licensing is playing a new role for ISVs—that of a significant competitive differentiator.

Virtualization and the cloud are having this impact because they are fundamentally changing our entire notion of what constitutes a customer’s “environment.”  A server is no longer a physical machine X in location Y.  An application is no longer the code that runs on stack S to support client platforms P₁ and P₂ to provide access for known users U₁-U_x.  Instead, customer environments are highly fluid physical and logical spaces that are being continually re-shaped by workloads, cost, performance, compliance, market pressures and the incessant emergence of new provisioning alternatives.

And as enterprise IT managers wrestle with the new realities of their fluid environments, they are getting less and less patient with ISVs who don’t “get it.”  In fact, many of them are starting to make strategic decisions about which ISVs are in and which ones are out based on whether their software licensing schemes fit with the new reality of IT.

Three factors in particular are driving IT managers to make software licensing a top criteria for deciding which ISVs are worthwhile partners:

Customers demand fairness.  IT managers are downright angry at ISVs that fail to recognize the new rules of enterprise infrastructure.  ISVs that fail to accommodate the ascendancy of the virtual machine and the sometimes-my-PC-and-sometimes-my-smartphone user risk having their business taken from them by ISVs that do—even if their solutions are superior in other ways.

Customers demand flexibility.  IT managers today understand that their environments are in transition and that the way they deploy applications today might not be the way they deploy them eighteen months from now.  ISVs, on the other hand, tend to resist changes to their software licensing models and agreements.  ISVs that adapt to the fluidity of enterprise IT with more flexible software licensing will therefore be able to claim competitive superiority.

Customers demand a great experience.  IT managers are finding life complicated enough as they add layers of virtualization to their environments and try to successfully manage more “moving parts” than ever.  The last thing they need is for their ISVs to make software licensing and entitlement management more difficult for them.  ISVs can therefore add differentiated value by making it simpler and easier for customers to track existing software entitlements and activate new ones.

The bottom line is that, in a virtualized world, software licensing is not just a way for ISVs to pursue self-interest.  It’s also a way for them to demonstrate genuine understanding of and concern for their customers’ rapidly evolving needs.  ISVs that match technology innovation with software licensing innovation will win in this new world.  Those that don’t will risk becoming the latest victims of market disruption.

 If you’re an ISV, how have you altered your software licensing strategy to address virtualization and the cloud?  And if you’re an enterprise IT manager, what changes do you want to see your ISVs make in response to the changes in your IT environment?  Share your thoughts and responses below.