Gartner Research

Software License Providers Will Exploit Their Captive Licensees in Order to Move Them to SaaS

Published: 20 April 2015

ID: G00271465

Analyst(s): Rob Wilkes

Summary

Software procurement professionals must manage the impact of changing from on-premises to SaaS licensing models, as the longer term, more lucrative SaaS model will result in immediate revenue shortfall for many providers and cause them to look to their perpetual customers to make up the difference.

Table Of Contents
  • Impacts

Analysis

Impacts and Recommendations

  • Software vendors will find the traditional sales process of using field-based teams a luxury they can no longer afford, meaning IT procurement will not be able to rely on a trusted partner relationship and will have to increasingly make decisions based on their own expertise
  • Software vendors are starting to withhold or restrict new functionality on existing applications for on-premises clients in an attempt to move them to SaaS
  • Traditional on-premises licensing will not become cheaper, with vendors already offering preferential pricing and terms to organizations that move to SaaS

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