As the cloud becomes the more prevalent and preferred architecture – having a succinct, automated process between Development (Dev) and Operations (Ops)— DevOps—will be a critical success factor for IT shops.  During my research for Visible Ops Private Cloud and Client4Cloud – it became clear that IT shops that automated bad processes or did not have processes in place – only got into trouble faster.  The less process and more rigid controls IT put in place for the business the more the business would work around IT to circumvent policies that inhibited productivity.

The agility, flexibility, and dynamic nature of cloud computing provides significant ROI to the business but only if IT can create and automate processes that provide compelling value to overall productivity of the company.  As IT Ops becomes the "Cloud Broker" and is able to create virtual environments within minutes – Dev will need to automate the packaging, handoff and analysis to keep up.  One individual interviewed for Visible Ops Private Cloud indicated that although it was great that IT could  provide the virtual environment within 15 minutes it still took them over 9 days to have critical applications installed and running due to poor processes for software licensing, procurement, analytics, and change management.  (2011, ITPI)

Many senior development and operations executives I have spoken to are focused on – how to create a cloud environment that provides Infrastructure as a Service (IaaS) for the business. It became apparent during many discussions that DevOps is the next logical step.  Meaning, once the infrastructure is in place and automated – business will require IT to automate the rest of the process to reduce the overall time to value for the organization.  Successfully automating the handshake between Dev and Ops will be a critical success factor in companies realizing the true value of cloud computing.

Key elements to consider on your DevOps journey:

• Development workflow that enables collaboration across multiple geographies, groups, and departments.
• Secure source code repository with branching that also have a sound disaster recovery and security controls to reduce mistakes and malicious activities.
• Automated packaging and provisioning of applications across physical and virtual paradigms leveraging current backend systems for Asset Management, Configuration Management, Change Management, and Service Desk.
• Automated test and dev that are cloud enabled to provide both depth of scale but also ability to burst across various cloud environments.
• In depth analytics on application and feature level usage along with software license position to ensure that not only technically can you deploy in the cloud but legally should you.
• Automated software licensing handshake across hybrid clouds – also known as licensing as a service to enable lifting and shifting of workloads without the drag of manual approvals for bring your own software licensing policies of 3^rd party cloud providers.

DevOps is coming of age and will be more critical for both development and packaging moving forward.  The key is automating the handshake and processes now as part of the overall cloud implementation.

Want to learn more about DevOps…check out these upcoming events where Paul Peissner from CollabNet will share DevOps insights and how Flexera Software solutions fit within the process.

Some call it the "Internet of Things" others call it "Machine-to-Machine" and some simply call it the convergence of smart enabled devices with the Internet—whatever you call it—we are at a new inflection point of connected devices. Based on Analysys Mason forecasts (http://www.analysysmason.com/about-us/news/insight/M2M_forecast_Jan2011), within the next few years, literally billions of Internet-enabled microprocessors will provide digital intelligence and connectivity for almost every commercial and industrial product or appliance, even baby clothes (Baby clothes go high-tech: Pyjamas to monitor heart beat, temperature, movement), extending the Internet into most aspects of our lives. This reminds me of how Skynet was created. For some wondering what Skynet is – it is a fictional computer systems, part of the Terminator movie series, with highly advanced artificial intelligence built by Cyberdyne Systems to automate the first national defense network that is capable of processing information at billion or perhaps trillion of operations per seconds. In these fictional movies, everything from embedded devices to computer systems to everyday machinery that humans are dependent on are interconnected and are controlled by Skynet making itself an entity with massive power by the data that it has in its possession to control and destroy anything how it see fit.

Traditionally, old world engineered systems like appliances, vehicles, energy meters, and vending machine were not connected to anything internet or internet-like. But, these same redesigned systems are now entering into the Internet. Expanding rapidly and globally due  to the growing advancements in hardware and software components, these smart appliances and devices are becoming the "Internet of Things" and the "Machine-to-Machine Evolution". Initially and implicitly, it is not the consumers that will have the most to gain from smart enabled device networking — it's the businesses that support them. The intelligent device manufacturer of your washing machine should be interested in its operating and usage patterns. Perhaps when it breaks down it will let them know, so that they can call pro-actively to let you know that they can provide immediate service. This may sound only slightly interesting for consumers, but for business and industrial automation applications it yields several major advantages. Intelligent device manufacturers can use their connected products to develop customer service relationships that can ultimately recreate the basis of customer management and generate new software + service offerings that enable recurring software licensing revenue streams. They can use device-networking technology to reduce the hassles of product ownership, while at the same time helping their own business to reduce costs and pursue new revenue growth opportunities.

As operators and service providers upgrade their infrastructure to support the ongoing demand for bandwidth, smart enabled devices will become ubiquitous and will play a bigger role in our life – from navigation systems in our cars and phone, to remote diagnostic machines to monitor our vital signs. Smart enabled devices or machines of tomorrow will have the capabilities to communicate with each other and process real time information that will lead to more efficient business transactions and conversely making our lives easier and subsequently ever so more dependent on these devices. As more and more machines are connected to each other and are part of the central fabric of our life, one day a spark of phenomenon might eventually happen and will give life to Skynet.

Gartner has claimed that the 'Internet of Things' is on the horizon. The 'Internet of Things' is a phrase used to describe how the internet will link traditional smart devices, and a wide range of additional physical assets to allow these endpoints to generate and share data. Nearly every product will have an IP address and communication capability – not just networking and telecommunications devices, but also industrial equipment such as buildings, medical devices, test and measurement systems, construction equipment, and oil and gas machinery, to name a few – that will link to other devices and services via the web.

This isn't blue sky thinking. In its September 2011 report entitled The Internet of Things is Coming, Gartner recommends that CIOs and IT leaders set aside two days as early as 'before mid-2012' to develop a strategy for this scenario. The trend of pervasive Internet is already gaining hold and today is described in a number of ways in different industries – Machine-to-Machine (M2M) communications, intelligent device management, telematics, telehealth and "smart" infrastructure, to give some examples. Gartner forecasts that there will be more than 30 billion permanently connected devices by 2020 and more than 200 billion intermittently connected devices by that time.

Opportunity beckons intelligent device manufacturers. They must evolve their products from fixed function and disconnected systems to flexible and seamlessly connected devices.

In this video, Steve Schmidt, Flexera Software's vice president of corporate development, talks about machine-to-machine, the Internet of Things, connected devices, and the tremendous value to consumers, and the monetization opportunities for producers.

Steve Schmidt, Vice President of Corporate Development, Flexera Software 

My recent treadmill purchase literally drove home the point that Intelligent Device Manufacturers are fundamentally transforming themselves into software-centric, service-driven businesses.

The treadmill features a built-in Android Tablet computer.  It is connected to my home wireless network and displays the news, accesses email, lets me watch videos and more. The treadmill also connects to the manufacturer's cloud-based application. This application lets me program a workout using Google Maps. For example, I could plot a route around my neighborhood and save it in the cloud. Periodically, the treadmill connects to the cloud application, downloads the workout and programs it in with accurate details such as elevation and distance. I can also track my progress towards fitness goals by viewing my workout history with time, distance, incline, calories burned and pulse in the cloud application and also on the treadmill. I can download workouts planned by other consumers in exotic parts of the globe—the plan is rendered in the treadmill on a Google Map. The cloud application also has running events that I can compete in, in real time. I can also find a fitness coach online who can tailor a program and monitor my progress. And finally, I can also share my workout programs via Facebook or Google+.  

This example illustrates several trends we are observing in the broader Intelligent Device Manufacturer space:

• Adoption of Android well beyond mobile use cases into industrial equipment.
• Internet-enabled devices are growing as the treadmill example shows. Internet connectivity is a key enabler for several use cases including firmware updates, software updates and data upload/downloads (e.g. workout programs for the treadmill).
• Connectivity and software on devices are transforming business models. My treadmill's manufacturer has created a "hardware plus services" model since the cloud application that the treadmill connects to requires an annual subscription to give me access to my workout history and all the sharing features.
• Many devices are capable of creating an app store and partner ecosystem for manufacturers. For my treadmill, fitness professionals from anywhere in the world can work with me and get paid for their services. Likewise, many fitness apps could be developed for the treadmill ecosystem.
• Social media features are being built into devices.

What are your experiences with smart devices?

Read related blogs:

• Machine-to-Machine (M2M) Has Evolved

• Anyone for 1 quadrillion intelligent, connected devices on the Internet?

• New IDC Report Highlights How Licensing Helps Intelligent Device Manufacturers Generate Revenue from Embedded Software
  

• Intelligent Devices Proliferate Due to Abundant Processors and Embedded Software

Historically, independent software vendors (ISVs) have thought of software licensing primarily as a means of protecting their intellectual property (IP) and maximizing revenue.  Effective software licensing technology, after all, is essential for ensuring that IP is not intentionally or unintentionally used in a way that violates contracts.  The right software licensing structure can also help ensure that ISVs receive incremental added revenue for incremental added value.  Neither of these software licensing value propositions is going away any time soon. 

As enterprise technology environments enter a new transformative period characterized by the adoption of virtualization and the cloud, however, software licensing is playing a new role for ISVs—that of a significant competitive differentiator.

Virtualization and the cloud are having this impact because they are fundamentally changing our entire notion of what constitutes a customer’s “environment.”  A server is no longer a physical machine X in location Y.  An application is no longer the code that runs on stack S to support client platforms P₁ and P₂ to provide access for known users U₁-U_x.  Instead, customer environments are highly fluid physical and logical spaces that are being continually re-shaped by workloads, cost, performance, compliance, market pressures and the incessant emergence of new provisioning alternatives.

And as enterprise IT managers wrestle with the new realities of their fluid environments, they are getting less and less patient with ISVs who don’t “get it.”  In fact, many of them are starting to make strategic decisions about which ISVs are in and which ones are out based on whether their software licensing schemes fit with the new reality of IT.

Three factors in particular are driving IT managers to make software licensing a top criteria for deciding which ISVs are worthwhile partners:

Customers demand fairness.  IT managers are downright angry at ISVs that fail to recognize the new rules of enterprise infrastructure.  ISVs that fail to accommodate the ascendancy of the virtual machine and the sometimes-my-PC-and-sometimes-my-smartphone user risk having their business taken from them by ISVs that do—even if their solutions are superior in other ways.

Customers demand flexibility.  IT managers today understand that their environments are in transition and that the way they deploy applications today might not be the way they deploy them eighteen months from now.  ISVs, on the other hand, tend to resist changes to their software licensing models and agreements.  ISVs that adapt to the fluidity of enterprise IT with more flexible software licensing will therefore be able to claim competitive superiority.

Customers demand a great experience.  IT managers are finding life complicated enough as they add layers of virtualization to their environments and try to successfully manage more “moving parts” than ever.  The last thing they need is for their ISVs to make software licensing and entitlement management more difficult for them.  ISVs can therefore add differentiated value by making it simpler and easier for customers to track existing software entitlements and activate new ones.

The bottom line is that, in a virtualized world, software licensing is not just a way for ISVs to pursue self-interest.  It’s also a way for them to demonstrate genuine understanding of and concern for their customers’ rapidly evolving needs.  ISVs that match technology innovation with software licensing innovation will win in this new world.  Those that don’t will risk becoming the latest victims of market disruption.

 If you’re an ISV, how have you altered your software licensing strategy to address virtualization and the cloud?  And if you’re an enterprise IT manager, what changes do you want to see your ISVs make in response to the changes in your IT environment?  Share your thoughts and responses below.

In a recent blog post, Mathieu Baissac shared some thoughts on the ISO/IEC 19770-3 software entitlement tag. Following is an introduction for everyone in case you are not familiar with the ISO/IEC 19770-2  and -3 software entitlement tag.

The ISO/IEC 19770-3 SAM Standard is a technical specification for software entitlement tags. A software entitlement tag is a digital encapsulation in an XML format of licensing rights and limitations, and optional licensing metrics. The specific information provided by a software entitlement tag can be used to ensure compliance with licensing rights and limits, and to optimize licensing usage and costs.

The software entitlement tag will be delivered through the procurement process of software licences. It applies to both volume and retail procurement processes as well as delivery of open source, shareware, evaluation, and not-for-resale software products. In the volume procurement case, software entitlement tags will typically be received and managed centrally by a customer together with other software asset data.

A software entitlement tag allows for reconciliation of entitlements with software installed and/or used by customers. When a software entitlement tag has been created and electronically signed by a software publisher, it can be used for demonstration of entitlement ownership by a customer.

The following comparison of an ISO/IEC 19770-2 software Identification tag with a software entitlement tag will help to better understand the software entitlement tag:

• ISO/IEC 19770-2 software identification tags typically travel with the software package and are stored on a computer's disk during installation of the software package.
• ISO/IEC 19770-3 software entitlement tags typically travel with the software license ("entitlement") purchasing documents and therefore may have many different delivery methods and timings.
• ISO/IEC 19770-2 software identification tags have no unique instance identifier per instance of tag. If a customer has two copies of the same software product then they have two identical ISO/IEC 19770-2 software identification tags.
• ISO/IEC 19770-3 software entitlement tags usually have a unique identifier per instance of the tag. If a customer acquires entitlements for two copies of the same software product at different times, each instance of the software product will have a unique software entitlement tag with a unique ID.
• ISO/IEC 19770-2 software identification tags do not specify a quantity
• ISO/IEC 19770-3 software entitlement tags contain quantity and units of measure. One instance of a software entitlement tag may entitle many instances of a software package. Additionally, one instance of a software package may have many software entitlement tags – as entitlement rights to use particular features are acquired.
• ISO/IEC 19770-2 software identification tags contain no entitlement, or "right to use", information – ISO/IEC 19770-2 software identification tags contain only "software identification" information.
• ISO/IEC 19770-3 software entitlement tags contain specific details about the entitlement rights granted for a particular software product, as well as details about entitlement limits, and how those rights and limits can be measured.
• ISO/IEC 19770-3 supports software asset management (SAM) processes as defined in ISO/IEC 19770-1. It is also designed to work together with software identification tags as defined in ISO/IEC 19770-2.

Standardization of software entitlements provides uniform, measurable data for both the license compliance, and license optimization, processes of SAM practice. Software entitlement tags benefit all stakeholders involved in the creation, licensing, distribution, releasing, installation, and ongoing management of software and software entitlements.

If you're interested in learning more, just ask...

John Tomeny is a twenty-year veteran of the SAM/ITAM industry, the Convener of the ISO/IEC 19770-3 SAM Standards development group and a co-author of the ISO/IEC 19770-2 Software Identification Tag standard.  He is a distinguished recipient of the IAITAM Fellow designation from the International Association of IT Asset Managers, and winner of the CODiE Award for "Best Asset Management Solution".  John is VP of Sassafras Software, the publisher of  "K2 - KeyAuditor & KeyServer". John serves as chief ITAM consultant and trainer to Sassafras's North American and European customers.

I've had the honor of being part of the working group that has been creating the
ISO-19770-3 standard for the last few years.

The scope of the ISO/IEC 19770-3 standard for software entitlements is quite large:

• Provide customers a mechanism to receive, in a standard format, a recording of their entitlements
• Establish processes by which this information moves from Publishers through the channel and to the customers
• Provide mechanism for customers to create their own -3 tags (in case publishers do not provide them)
• Provide enough information in the tag itself so that:
  • Customers can understand rights and limitations
  • Customers can potentially validate actual compliance  and optimize licensing
  

This standard defines, at a high level, the 19770-3 tag as:

            A software entitlement tag is a digital encapsulation in an XML format of:

• Rights and limitations which have been conveyed to a customer
• Optional detail metrics which can be used to ensure compliance with the rights and limits.


This standard does not limit the definition of entitlements to just "license" – but instead describes "rights to use" and "rights to access." This broad definition was adopted as recognition that software licensing models are changing and therefore customers will need to understand all their rights – regardless of whether they purchased a SaaS service, a perpetual license, a term license or maintenance and support.  To determine their compliance position, customers must understand all of these details.

This standard includes the whole concept of providing "metrics" to validate compliance. The standard includes concepts like "test methods" including test values, scripts and URL so that customers can test compliance. We examined a variety of licensing models – including hardware (processors or CPUs), per device, user-based, client access licenses, virtualized guests, etc. 

The standard captures the limits for each entitlement including time (e.g., perpetual vs. start/end date), geographical limits (e.g., can only use it in country X), customer type limits (e.g., only for education), language limits (e.g., can only use the French version), platform limits (e.g., can only use on x86-32), environment limits (e.g., "production" vs. "test"), as well as the ability to apply any number of other limits. By standardizing how these limits are expressed, publishers and customers can both help customers stay compliant.

This standard also enables publishers to provide a lot of additional information including contract information, rules for true-up, purchase information (including channel partners, product names that they use, etc.), auditor, and even activation information. All of these are optional elements which can assist the publisher in better informing the customer.

This standard recognizes that entitlements change as part of a lifecycle. Consequently this standard has lifecycle concepts like revoke, archive, upgrade and deployment concepts such as retail distribution, channels, OEMs, open source, and SaaS to name a few. The standard includes a large number of scenarios such as maintenance renewals, partial upgrades, add-on purchases, edition migration, capacity adjustments, location transfers, evaluation to perpetual conversions, conveyance of secondary use rights, bankruptcy, and true-up. The goal is to provide guidance on what type of entitlement information should be provided under these circumstances.

Lastly, this standard was written to co-habit with the ISO/IEC 19770-2 standard for software identification. Once publishers start supporting both, then customers will be able to answer comparative questions like "what do I have installed" compared to "what do I have the right to install/own/have" or "what is my company using" compared to "what does my company have the right to use" and "how do I validate that I'm using this correctly?"

I look forward to the publication of ISO/IEC 19770-3 and how Flexera Software can help publishers and customers use the standard to improve their understanding and overall management of software licensing.

The software industry is rapidly changing and becoming more commoditized.  In a mature marketplace, software vendors must be more creative and innovative in product pricing and packaging in order to differentiate and gain competitive advantage.  Packaging features and functionality in new and creative combinations enables vendors to deliver additional value and capture new revenue streams.  Indeed, flexible packaging, software licensing and entitlement models are key to giving software vendors the upper hand to act and react to changing product and pricing sensitivities. 

In this video, Jim Geisman, president and founder of Software Pricing Partners, discusses software licensing, pricing and packaging best practices software vendors should adopt in competitive markets.

Watch the Software Pricing and Packaging Best Practice Advice from Software Pricing Partners Video

Jim Geisman, President and Founder, Software Pricing Partners

Over the past year, there has been an increasing buzz around User Centric Computing, especially in the enterprise IT context. Very little has been written about what this trend implies for software publishers. This article will demystify User Centric Computing as it relates to its impact on software licensing from the perspective of software publishers.

What is User Centric Computing? Unlike IT's traditional "device-centric" approach, user-centric computing is all about providing business users with a seamless and personalized experience of all their applications regardless of their device, location, operating system and network connectivity. Enterprise IT benefits by being able to secure and manage users and their environments centrally. As pointed out in another blog "Getting Started with User Centric Computing" -- user-centric computing gives users control of their computing experience, providing them with access to any combination of computing environments, applications, settings, and data from any location or device.

 The ingredients of a User Centric Computing solution include[1]:  

• An approach to managing user preferences, data and user-specific applications. User Experience Management Solutions such as AppSense meet this requirement.
• An approach to delivering applications provisioned by users' IT departments. Application Virtualization (e.g. Microsoft App-V), Remote Desktop Services (e.g. Citrix XenApp) and Virtual Desktop Infrastructures (e.g. Citrix XenDesktop) are broad categories of solutions targeting this requirement.
• An approach to managing the end user's computing environment, when applicable. Note that with enterprises allowing users to "Bring Your Own Device", corporate IT may not actually be responsible for managing the end user's computing environment. This requirement is met using the management framework of a Virtual Desktop Infrastructure solution.

From a deployment perspective, User Centric Computing involves the creation of a bundle of applications on a central server and delivering them to users using an application delivery approach listed above.

Implications for Software Licensing – If you are a software publisher, User Centric Computing will require you to:

Evolve your licensing approach: If your current software licensing approach is tied to a device, it has to change, by definition, since user-centric computing un-tethers users from their devices. If you use some form of concurrent licensing, that too needs to evolve to account for off-network use of applications as well as situations where the same user consumes your application from multiple devices. In either case, licensing metrics and approaches should align with users (e.g. licensing based on named users) of the application rather than devices or instances of your application.

Consider usage-based monetization (versus license enforcement): As enterprises expect a seamless application experience for users across diverse environments, they will not want license provisioning to get in their way. At least some enterprises will push publishers for usage-based licensing approaches (versus license enforcement). Besides, license enforcement based on device attributes will just not work in solutions such as Virtual Desktop Infrastructures as machine virtualization is at its core.

Provide centralized administration for entitlements and licenses: Centralized administration of users and their computing environment is a key aspect of User Centric Computing. Needless to add, we will see enterprises pushing their software publishers to provide tools that help them administer entitlements and licenses in a consolidated fashion across all their products and eventually, across multiple publishers.

[1] Source: "User Environment Management: Smackdown", PQR, http://www.virtuall.nl/download-document/user-environment-management-uem-smackdown

Recently I had a call with some folks who were responsible for process improvements in the company's "Quote-To-Cash" processes. They work at a very large software/hardware producer (household name withheld). They asked all kinds of questions, including: 

• "When is this SaaS stuff going to be mainstream?"
• "When do I need to get ready for generating phone-bill like invoices in any large amount?"
• "When is this subscription stuff going to get real (in a meaningful way)?"

The most senior person said, "There is so much buzz—I don't believe any of it."

I then came upon an article in Forbes – The End of ERP – from the CEO of Zuora, Tien Tzuo. The article has statements like "ERP – enterprise resource planning software – is on its deathbed" and "A moment of silence for ERP." As someone who has implemented ERPs for many years, in many countries—for different types of companies—I started laughing.

His point…  I'm referring to the shift we are experiencing away from a 20^th century product-based, "buy once" economy to a 21^st century services-based "Subscription Economy" centered around recurring customer relationships… Is potentially correct, but it doesn't mean that ERPs are going away.  ERPs run manufacturing floors, maintain financial books, track purchases, etc. Those aren't going to go away just because we're moving to a "subscription economy."

So back to those process improvement folks. What are they supposed to think about this article? They're going to just chuck it to "more buzz" and choose to ignore it. That doesn't help us – the subscription economy is growing and ERPs are here to stay.

By the way, my answer to them was, "You have a while before SaaS and Subscription revenue becomes a large percent of your revenue, but since it's so transformational and affects so many areas – you'll need to start investigating now!" and "We can help you."

View the recent 2011 Key Trends in Software Licensing and Pricing webinar with Amy Konary from IDC for more information on transformational technologies you need to be prepared for.