HP Software Revamps Partner Program Licensing

Hewlett-Packard is revamping its software licensing options and software channel program in an effort to make more of a play for the managed services platform space and to better accommodate the way end-user companies and solution provider channel partners would prefer to pay.

"We are helping partners reduce their risk [and] improve their cash flow and their P&L," says Ammar Sakkal, director of HP's global partner program for HP Software and Services.

HP's new Software and Solutions Managed Service Provider Program, announced June 2, complements HP's recently announced software-as-a-service (SAAS) partner program. Partners can offer their own branded and hosted application security managed services or project-based application performance validation services based on HP's offerings.

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But what's different about today's announcement is how HP is selling the licensing. The company is offering a handful of different options to help channel partners better match what they pay to HP to their accounts receivable from customers so that partners are not left holding the bag if a customer changes terms. 

The new program helps partners offer managed services based on HP Business Technology Optimization and HP Information Management Software by using several new licensing models including multitenant, utility and subscription, and dedicated perpetual.

Multitenant allows partners to service multiple end-user companies on the same infrastructure and allows for lower administrative costs.

Utility and subscription helps partners align their services revenues with their services expenses through incremental billing. HP says the new procurement term flexibility enables partners to increase or decrease what they pay HP for software usage based on what the customer consumes.

Dedicated perpetual offers perpetual licenses to partners that provide services to a single dedicated end user. Partners capitalize the purchase, which helps reduce administration cost and improves ROI.

"We think the IT software services market is a growth market," Sakkal says. "All these options let partners play into that market."

HP's most recent earnings revealed that software contributed $880 million to HP's revenues and was one of the company's most profitable businesses.

Partners typically touch 40 to 50 percent of HP's software business, says Brad Schlagenhauf, worldwide channel alliance manager for HP Software and Solutions.

In addition, HP says term-based licensing lets partners offer software licensing on a per-project basis, lowering costs for customers.

HP has also revamped the way partners access marketing materials with the new HP Campaign Syndication Program. Partners can get access to marketing templates and personalize them with their own offerings and post them to their Websites.