W H I T E PA P E R

Increasing Revenue and Customer Satisfaction with On-Demand Service

Increasing Revenue and Customer Sat isfact ion wit h On-Demand Service

Increasing Revenue and Customer Satisfaction with On-Demand Service

Introduction
Electronic licensing is an increasingly popular and valuable tool for software publishers and intelligent device manufacturers who want flexibility in the way they sell and license their software, while at the same time maintaining and enhancing control of their intellectual property. According to industry analyst IDC*, 84% of software is electronically licensed. While electronic licensing and other digital rights management technologies can have significant upside for software producers and intelligent device manufacturers in terms of increasing sales and reducing revenues lost to unlicensed use, such technologies must be effectively managed to avoid creating new operational issues and costs for the software producers and intelligent device manufacturers. For an electronic licensing program to be successful, the software producers or intelligent device manufacturers customers must accept it. This requires that the licensing program be fast, accurate, and easy for the customer to use, ideally in a selfservice model. Meeting these requirements can be a challenge for producers and manufacturers who must create the processes and technology to: Generate licenses based on specific entitlements (orders) Deliver licenses securely Process returns and exchanges Manage version upgrades and platform changes By using Flexera Software FlexNet Producer Suite on-demand service to securely and cost-effectively deliver and manage electronic licenses alongside the licensed software itself, software producers and intelligent device manufacturers can take advantage of the benefits afforded by electronic licensing without incurring the costs or complications inherent in developing, managing, and maintaining an electronic license delivery solution in house.

Electronic License Delivery Models

Just as there are many kinds of contracts under which software producers and intelligent device manufacturers choose to sell their products, there are many models for the electronic licenses that enforce those contracts. Fortunately, these various electronic licensing models can be grouped into a few broad electronic license delivery categories, each of which the FlexNet Producer Suite on-demand service supports. Many electronic licensing approaches (e.g., time-based, featurebased, and unit based) can be fulfilled through a transaction or entitlement-based electronic license delivery approach. In an entitlement-based approach a unique license key is generated and delivered, based on a combination of the attributes of the product being licensed and the attributes of the entitlement transaction (or order). For example, if a database server product is configured for licensing based on the number of CPUs and a specific order is for an eight CPU license, then a license key would be generated which allows the server to use up to, but no more than, eight CPUs. For entitlement-based license models, the on-demand service supports two approaches to delivering license keys: 1) If existing process for generating license keys is based on an order, you can continue to use existing processes and use the on-demand service to securely deliver license keys to users the same way the software is delivered. You can use the service to deliver the key at the same time the software order is placed, or if key generation is a separate

These challenges are compounded when the software producers and intelligent device manufacturers have more than one licensing technology. FlexNet Publisher has been leading the industry for more than 20 years, but there are homegrown and other technologies available. From mergers and acquisitions to partnerships, multiple technologies are common today and very likely tomorrow. Even if they are lucky enough to only have one technology, many have very different licensing strategies and business rules for different product families and for different markets.
* IDC 2005

Flexera Software: FlexNet Producer Suite White Paper Series

Increasing Revenue and Customer Sat isfact ion wit h On-Demand Service

process, the key can be added to the order and delivered at a later time. 2) Use on-demand service to generate the license key. Flexera Software typically will host the key generation algorithm on its servers and will extend the on-demand service to call the algorithm when an order is received. For software producers and intelligent device manufacturers who do not need the licensing granularity provided by entitlementbased licensing, another approach is product-based licensing. In this model the license key (sometimes called a serial key), is tied to the product and not the customer. In some cases, productbased keys are unique to each instance of the product, that is, each user gets a different key. In others, every copy of a particular product uses the same key. FlexNet Producer Suite on-demand service can be used to generate and deliver license keys in both of these scenarios. In the former case, a unique key for each instance of the product, the on-demand service can be configured to distribute keys from a pool or to generate keys based on an algorithm. Typically the key is generated at the time the order is processed, but it can also be triggered by other events, such as when an end user explicitly requests a license key. In the second instance, where a key or serial number is unique to a product or release, but the same for all users, the software producers and intelligent device manufacturers typically provide the license key along with the product or upgrade. Again, FlexNet Producer Suite on-demand service can be extended to pull the key from a pool or to generate it based on an algorithm. One of the advantages of using the on-demand service for product or version-based licenses is that the on-demand service makes it easy to ensure that users always have the correct key or serial number for the version they are downloading or using. The on-demand service will typically also update the software producers and intelligent device manufacturers internal CRM or ERP system linking the newly delivered key with the customer order. A final form of electronic licensing requires the end user to provide site-specific information in order to generate a license. For example, the identity of the specific machine on which the license will be used. This can be done explicitly by the user through an interactive Web form, or implicitly as part of a product installation process where the installer contacts a license server and provides the machine information in exchange for a valid license key. This sort of license also typically requires that the license key be tied back to a valid entitlement or order. The on-demand service is easily extended to provide the user interface and/or to support an automated client. The same capabilities discussed above are then used to actually generate the license key.

While site specific licensing can be among the most effective methods for curbing unauthorized use of a software producers and intelligent device manufacturers product, this approach also has the highest operational support costs. In particular, the need to allow users to move licenses between machines (re-hosting) can be very labor intensive for software producers or intelligent device manufacturers. The on-demand service can significantly reduce this cost by providing an automated web-based selfservice solution.

Summary

FlexNet Producer Suite on-demand service provides a scalable, secure, 24/7 infrastructure and application to support automated generation and delivery of any type of electronic license. Using FlexNet Producer Suite on-demand service for electronic license delivery is one more way that partnering with Flexera Software enables a software producer or intelligent device manufacturer to focus on building and selling software while we take care of the logistics of delivery.

How Flexera Software Professional Services Can Help

Flexera Software Professional Services enables software producers and intelligent device manufacturers to accelerate and increase the value your organization receives from Flexera Software. Our experts average more than 20 years experience in software entitlement, licensing, installation, and packaging. Through subject-matter expertise and a proven methodology, we can help you implement and evaluate current or potential strategies to achieve your business objectives.

About Flexera Software

Flexera Software is the leading provider of strategic solutions for Application Usage Management; solutions delivering continuous compliance, optimized usage and maximized value to application producers and their customers. Flexera Software is trusted by more than 80,000 customers that depend on our comprehensive solutions- from installation and licensing, entitlement and compliance management to application readiness and enterprise license optimization - to strategically manage application usage and achieve breakthrough results realized only through the systems-level approach we provide. For more information, please go to: www.flexerasoftware.com

Learn More about FlexNet Producer Suite If you wish to learn more about the capabilities of FlexNet Producer Suite, please visit the Flexera Software Web site at http://www.flexerasoftware.com/solutions.htm

Flexera Software: FlexNet Producer Suite White Paper Series

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