Software as a Service Conversion
Many companies are now looking at converting perpetual software pricing to Software As A Service (SaaS) pricing or creating a new supplementary revenue stream to existing perpetual licensing. The following is an example of how this can be financially modelled, but consideration is required about protecting existing perpetual software pricing and revenue. One way of doing this is to pick an equivalent payback period that is used to determine the monthly subscription price. This can be offset using weighting according to customer commitment albeit pay as you go (no fixed contract) and various fixed term contracts. Customers should be rewarded according to the length fixed term contract i.e. the longer the commitment more cost effective the monthly cost (price).
One key benefit of SaaS products is that not only does the customer get access to the full product but also support and ongoing version upgrades. Other incentives can include bundles of licenses or licenses that can installed X number of times, but can only one can be used at any one time.
Many companies are now looking at converting perpetual software pricing to Software As A Service (SaaS) pricing or creating a new supplementary revenue stream to existing perpetual licensing. The following is an example of how this can be financially modelled, but consideration is required about protecting existing perpetual software pricing and revenue. One way of doing this is to pick an equivalent payback period that is used to determine the monthly subscription price. This can be offset using weighting according to customer commitment albeit pay as you go (no fixed contract) and various fixed term contracts. Customers should be rewarded according to the length fixed term contract i.e. the longer the commitment more cost effective the monthly cost (price).
One key benefit of SaaS products is that not only does the customer get access to the full product but also support and ongoing version upgrades. Other incentives can include bundles of licenses or licenses that can installed X number of times, but can only one can be used at any one time.
saas_template_pricing_05-01-14_sw__hw.xlsx | |
File Size: | 15 kb |
File Type: | xlsx |