Looking Back: Top 10 Software Stories - Services Grow;Licenses Shrink

Services Grow; Licenses Shrink

Enterprise CIOs screamed loudly and traditional license software companies listened. CIOs sick of paying a premium for software and, what many say are useless maintenance upgrades, told vendors they want innovation and more features without the related IT overhead dollars required to maintain large-scale implementations behind the firewall. There is nothing new about subscription models for critical business apps, but, until recently, SMBs were the majority of users. Partially driven by cloud buzz and SOA architecture, but more driven by cost and growing dissatisfaction, increasing numbers of enterprises jumped off the license bandwagon and took up land in subscription MSP models. In 2010, expect to see security concerns confronted head on and more ISVs partnering with cloud companies like Fujitsu and IBM to establish revenue-sharing models that allow enterprise customers to move to subscription models for monthly payments and enjoy the benefits of receiving innovative upgrades without the large IT investment required in license models.