Posted by: drmiw | January 16, 2009

Silver lining the computing cloud for Softcat

I attended the first Softcat hosting summit in London this week with Paul and many of our competitors. Before bringing on the first act, Dave Simpson, Softcat’s commercial director revealed their linear growth in monthly pay-per-use software licenses since 2003, which started to really bubble up above the straight line in 2008. Meanwhile, their revenue from owned licenses has stayed steady, and they expect this to be surpassed by monthly licenses by next year. Until recently the monthly licenses sold have mostly been Microsoft SPLA ones to hosted service providers like Extrasys, but more and more software providers are getting in on the act, which is good news for Softcat and Extrasys both.

Graham Crich, VMWare‘s UK Hosting Manager gave the first talk, ‘Introducing the VSPP Program’, in which he outlined VMWare’s new hosted pay per usage pricing model – and also revealed that it is currently illegal to host VMware machines for clients! There is a minimum commitment to user numbers over three years, but it’s not too scary. Citrix were not present at the event but apparently even they – who have built their business on an inflexible, unscalable licensing model with big first year costs – are in talks with Softcat to provide a pay-per-use licensing model. It’s about time too!

Softcat’s Dave Simpson says that “cloud computing is the business to be in” and I couldn’t agree more, and it seems that software license providers are realising too that hosted pay-per-use IT services are becoming more and more popular with businesses, especially in the current economic climate.

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