SPLAReporter

About

Software licensing is facing many new challenges as computing continues to move towards an integrated cloud-based ecosystem, with 63% of enterprises utilising private cloud services in 2015 (a 10.8% increase from the previous year). Traditionally companies could just pay for the total of the licenses distributed to their devices, but under cloud deployment it is a lot less clear, with different software being licensed under several different models, including ‘per virtual user’, ‘per virtual/physical core’ ‘per device’ or ‘total usage (on demand)’.   In a study by SAP, 80% of business enterprises expect a combination of these licensing models to get the best possible deal, however 59% of business enterprises said they did not have the necessary knowledge to do so. This has led to mass complication for software licensers to calculate how much customers should be paying, as there is currently no universal method of tracking their usage. A result, this has led to 43% of software installed on personal computers not being properly licensed, meaning $62.7bil lost revenues in 2013.   The software licensing market (valued at $407bil by Gartner, and the fastest growing industry in IT space) is changing, with more than half of vendors polled by IDC stating they will make changes in their software licensing models. Many of these will be moving towards subscription-licensing plans in order to maximise revenue by only paying for the software they are using, as currently more than 25% of software installed in large enterprises is never used, collectively costing over $7billion. However, this becomes challenging for License Service Providers (LSPs), who distribute the cloud based licenses on behalf of software publishers to keep track of licenses, as there is currently no sufficient method of keeping track of which software is being used in hosted environments and hence which licenses should be paid for, resulting in around $64bil/yr in lost revenue for LSPs5.   One way this issue is being addressed is through The Services Provider License Agreement (SPLA) program, which was created by Microsoft in 2007 as an option to allow hosted service providers (HSPs) to offer licensed software (such as MS Dynamix, MS Office) as part of their hosted services. The hosting providers submit monthly reports to the publishers (via LSPs) of the software to show how many ‘SPLAs’ have been deployed to end user organisations so that the LSPs can invoice them the corresponding amount. However, current limitations in this technology have led to these reports being created either manually or with inadequate scripts deployed through the hosted environments. Microsoft estimate inaccuracy levels of 25% in the reporting, resulting in an estimated potential loss of 15% of SPLA revenues. This is a widespread issue. For example, admin costs for LSPs checking these reports in the UK total £800,000. Softcat, the largest LSP in the UK (estimated to have 60% of the UK Microsoft SPLA market, there are around 30 major LSPs worldwide), employ more than 5 full-time staff to compile invoices and check the SPLA reports alone, with estimated inaccuracies occurring on up to 50% of their SPLA reports. HSPs are affected more severely due to not only having full-time staff members compiling these reports, but also constant audits (68% of organisations have >1 software audit a year, lasting up to 8 months6) to ensure they are paying correctly for the software, the IDC estimates 25% of an organisations software budget is spent dealing with license complexity alone, with the ‘true cost’ being over $100,000 a year for 44% of enterprises, and potentially losing the right to distribute SPLAs. These errors are hugely costly in admin and lost revenue to both the hosting providers and LSPs. TBSC has recognised that a significant opportunity exists for an advanced, accurate, automated technology for creating SPLA reports on behalf of the HSPs to eliminate errors and maximise revenue. TBSC has developed ‘SPLAreporter’, an automated solution that collates software usage data into a report - a step change technology that has the potential to deliver a 15% increase in SPLA revenue (€534m annually). This innovation forms part of the company’s international recognised product portfolio which includes RentSoft Meter – a usage metering solution for measuring and reporting on software usage/efficiency adopted by more than 13K customers and recipient of numerous accolades for technical innovation including Best Software Usage Metering’ & ‘Best Software Efficiency tool’ at the Technology Innovator Awards 2015. SPLAreporter has successfully overcome the technical barriers to existing solutions and solve the problems faced by end users which include: Low cost to end customers; 75% decrease in time spent compiling SPLA reports by HSPs lowers the ‘real costs’ of completing these reports, which is over $100k for 44% of enterprises Improved accuracy in monthly SPLA reports; Human error is a large problem due to the complexity of several different licensing models. SPLAreporter is automated and will eliminate human error, decreasing errors in SPLAreports by 25%, resulting in a 15% increase in SPLA revenue for LSPs Versatility, many current solutions involve scripts placed on users’ devices to calculate usage, meaning it is device limited. SPLAreporter is cloud based and hence does not face such issues, meaning it will work on any device Usability of solution; SPLAreporter will produce reports than can be exported to Excel with several customisable options, including automatic invoicing from LSPs. This feature is not currently available in any existing solution.