A growing number of software vendors are looking at the introduction of pay-as you-go offerings as a more flexible way of winning business.
The spreading of payments and the inclusion of services in monthly fees is popular with end-users, particularly among small business owners, and the channel has also reacted positively to the trend.
Express Data marketing manager, Peter Masters, reported growing interest from customers wanting pay-as-you-go software terms.
Microsoft had shown leadership in this area, he said, and Express Data was working with more than 20 other vendors to offer similar services.
“Many vendors see pay-as-you-go as the way of the future and we are working with them to facilitate that transition,” Masters said. “Such a system helps everybody. You can plan the business better and it evens out bumps in the cash flow.” The growth of pay-as-you-go software is a natural progression from licensing, an area of business which has seen increasingly sophisticated channel involvement. Microsoft launched its Open Value in October, promising SMEs a licensing model based on predictable annualised payments that had previously been reserved for large corporate customers.
Microsoft partner group director, Kerstin Baxter, said distributors were now offering licensing and consultancy as well as managing licensing payments. Open Value covers the Office suite, server products and customer relationship management software.
Ingram Micro managing director, Steve Rust, said Microsoft’s Open Value concept had initially been a slow burner but had now taken off.
“It is a far easier sell when the customer has a license because sales staff can build security into the revenue stream,” he said.
“For vendors and resellers there is brick-walling. Once sold, it keeps the competition out, which helps them stay loyal to the reseller too.” n