Software Licensing Featured Articles

How Entitlement Management Ensures Proper Royalty Payments in Software Licensing

September 13, 2013
By Susan J. Campbell, Software Licensing Contributing Editor

The transition to an always-on environment, where we have access to the latest technologies regardless of our location, has been well received by the busy consumer. For the software company that relies on software licensing to drive revenue, the adoption of the Software as a Service (SaaS) platform changed the playing field. Now, entitlement management must be deployed to ensure royalty payments are honored.

A recent Flexera Software blog explained the process, as Vikram Koka, Vice President of Engineering for Producer Solutions shared the important role software licensing plays in intelligent devices. This technology ensures proper royalty payments for device manufacturers on software components in the transition from pure hardware providers to solution providers.

A number of these companies are leveraging embedded software to achieve differentiation and a competitive advantage and there is a full range of software licensing models. Some are using high trust post-pay models, lower trust pre-paid models and everything in between. Regardless of the method, all models must include the right licensing to ensure accurate royalty reporting.

Traditionally speaking, according to Koka, manufacturers would ship physical components, like boards or scanning equipment, which were built into end business or retail systems. Through this method, they could simply track the unit number shipped and track all components back to their manufacturers. These companies would then be compensated appropriately for the devices or components shipped.

In today’s environment, components are no longer components. The level of trust in relationships must increase, which can be a challenge for all parties. At the same time, the manufacturers can’t always control where the components are used, how they are used and especially how they are tracked. Those companies concerned about the value of their brand will pay attention to the proper royalties and entitlement and turn to companies like Flexera for help.

With a focus on entitlement management, Flexera has the core elements in place to track royalty payments both in the post-paid and pre-paid models, helping to build a deeper level of trust between the parties. By offering support of all models or a blended environment, Flexera can deliver value on both ends and serve as an important business partner for future market expansions.




Edited by Blaise McNamee

Featured Press Release

Featured White Papers

The Third Industrial Revolution: Intelligent Devices, Software, and the Internet of Things

The IDC MaturityScape: Subscription Business Model Management
This study is designed for suppliers of products or services that are sold via subscription business models, and provides a framework required for the effective management of subscription approaches...

Virtualization, License Compliance and the Application Producer/Enterprise Relationship

Market Trends: Move Beyond Homegrown Licensing and Entitlement as the IoT Creates New Revenue for Software
This Gartner report explains that the Internet of Things is turning manufacturers into software vendors that need to protect, differentiate and monetize offerings. By changing their approach to licensing, manufacturing product strategists can maximize revenue potential...

The New World of Global Electronic Software Distribution: Sophisticated, Scalable … and Business Smart

Plugging Revenue Leaks from the ERP Gap: A Revenue Opportunity for Application Producers
This white paper explains how ERP systems were built to handle physical assets, not digital goods and provides recommendations for alternative software licensing and compliance solutions...

Featured Webinars

Key Trends in Software Licensing and Pricing and 2014 Predictions

Usage, Subscription and Value-based Licensing Model Trends, Insight & Guidance
Amy Konary, Research Vice President with IDC and Flexera Software will discuss usage, subscription and value-based licensing model trends and provide insight and guidance on approaches to achieve the best business and revenue outcomes.

Grow and Differentiate Your Device Business

Gartner Webinar: License and Entitlement Management - Using Internet of Things to Create Opportunity
Laurie Wurster, Gartner Research Director, will share the trends that are shaping IoT, the shift from a hardware to a software company, what you need to know in order to protect your IP, and whether to build or buy a license and entitlement management solution.

Reduce Security Risks

Considerations When Transitioning to Physical + Digital Solutions
Network equipment providers' core business model is under pressure due to a combination of business and technology trends impacting the telecommunications industry. This webinar looks at the trends and provides essential guidance.

Free Trials

See For Yourself Why So Many Trust Flexera Software Solutions

  • LinkedIn
  • Google+
  • News
  • Twitter
  • Youtube
  • Facebook