Open Sources | Rodrigues & Urlocker » Subscription vs. Licensing...just a matter of packaging?

April 05, 2007 | Comments: (0)

Subscription vs. Licensing...just a matter of packaging?

TAGS: Open Source

I've been having an ongoing dialog with a number of very large SIs and very large enterprises about how open source "support subscriptions" are still confusing to a great many purchasing departments.

Technically speaking, most open source companies provide an "enterprise license" when they sell a subscription so I am starting to wonder if all we need to do (as a whole) to make it easier to understand is redefine the way we present our offerings.

Pretty much all OSS companies sell subscriptions:
Subscription = License+Support

Whereas proprietary vendors sell licenses and maintenance (change the wording as you so desire)
License = License
Maintenance = Support subscription

Essentially, open source companies remove the upfront license fee, baking it into the cost of the subscription itself. This should theoretically be much easier than the proprietary offering but big vendors have forced it for so long, purchasing departments expect to see it that way. This seems fairly prevalent with large SIs as well, as they are typically providing some level of support to the software that they sell in as part of a large solution.

This whole thing started to make me wonder if open source companies should have 2 line sheets for customers:
1. Subscription (includes license and support)
2. License plus maintenance (includes license and support)

In case you haven't figured it out, these are exactly the same offerings just packaged slightly differently. Let's further extrapolate with an example:
1. Subscription: $1000
2. License: $500 plus Maintenance $500 = $1000 (you choose the values, but I think the smart move would be to just say that you have to buy one with the other—just like proprietary vendors do.

I think the moral of the story here is that there is more than one way to sell open source. Personally, I prefer the subscription model but there are clearly ways to package open source that conform to purchasing standards. It's all just a matter of marketing.

Posted by Dave Rosenberg on April 5, 2007 08:40 PM

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