Software Licensing Problems in Technical and HPC Markets
The technical and high-performance computing (HPC) markets are stuck in a conundrum of software licensing models. Over the last decade, the balance of software licensing models has shifted from installed software to software-as-a-service (SaaS). Yet very little purchased software in the technical and HPC markets has made the transition to the increasingly more popular SaaS model.
The largest and most prevalent software companies in the world do not sell installed software, including Google, Facebook, Amazon, Salesforce.com, and many others.
An article from Henry Blodget of Business Insider this week caught my eye for its sensational headline, “And Microsoft Is Giving Up On The Software Business!” With Bing, Office 365, Windows Azure, and others, Microsoft is playing catch-up on trying to establish a SaaS (and advertising) based business. As the article states, Microsoft has begun classifying itself as a “devices and services business.”
Another interesting development in our market is Roguewave’s recent acquisition of a SaaS company. Roguewave has traditionally been a strong player in our market delivering installed software, so the SaaS nature of this acquisition is interesting.
The technical and HPC markets have some of the most cutting-edge software in the world, yet the licensing models of these markets are stuck in the past. There are many reasons why, such as the need for the customers in this market to run software on their own servers or in deployable form factors.
In due time, I predict that the technical and HPC markets will also transition more to SaaS and services-based software licensing. Some of this transition will come through more cloud delivered solutions. Other aspects of this transition will come through larger services-based contracts which wrap software delivery with support manpower. How much of the market transitions and to what extent remain open questions.
How have you seen the technical and HPC markets slowly migrate towards SaaS and services-based software licensing?
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