06 November 2013

Subscribe To Software – Or Buy It?

Four years ago introduced a new licensing model: we went from a purchase to a subscription system for most of our solutions. Now subscriptions have been more common in the software business, but we still have to explain our decision to some evaluators.

KBase logotypeWe are convinced that the subscription model is better for all parties involved, so now we are leaving the purchase model completely. KBase for Outlook now has a subscription licensing, and the upcoming version 5 of TimeCard Single will be subscription based as well.

Always support 
All subscription levels include support, so users can feel sure they will always have someone to turn to with questions. They can always contact the support if problems should occur, and if we get a description of the situation we might point out new possibilities that the user had not considered.
Jitendra Patidar photo     Kate Kalmstrom, photo     Jayant Rimza photo
Vipul Dindulkar photo    Sharad Verma image    Sigge Kalmstrom, photo

Assistance can of course be given with a separate support contract also, but with a subscription there is no discussion. Users don't have to worry about if they have a valid support contract or not, and the support team knows that support should be given to all subscribers.

As we also give support to evaluators, the technicians can concentrate on solving problems and answering questions instead of wasting time in finding out if callers have valid support contracts or not.
Subscriptions give incentive to improve
Community iconAnother customer benefit of the subscription model is that it gives the team an incentive to maintain a good relationship with subscribers, so that they stay in our Community and keep renewing the subscription. We want long time relations, not a quick sale and then a hunt after the next one.

Worst scenario for one-time payments is a seller who says "Why should I care? I have already  received the money!" I am too concious of my reputation as a software developer to ever think like that, but all potential customers don't know that. A subscription system should inspire confidence.

Always upgrades upgrade iconWhen kalmstrom com solutions are updated with new features and support for new Microsoft versions, all users should be able to take advantage of that. Therefore all subscribers have free upgrades.

Or software is built on top of Microsoft’s, so we often have to adapt them to improvements in the Microsoft platforms. As a Microsoft Silver Partner we have access to preview releases, and we are very early aware of any compatibility issues. Then we can start developing our products to support the new version of Outlook, SharePoint or any other Microsoft products that the applications make use of.

Better finances
The subscription model makes finances simpler for the subscriber, as it gives a clear projection of software costs. There will be no extra payments for support or upgrades, buy iconas this is already included in the subscription fee. Hopefully, as we do our best to keep current customers happy, the subscription will continue year after year and there will be no costs for changing software. also benefits from the subscriptions, because they give us a predictable and constant revenue stream. Compared to the purchase model this reduces potential uncertainty and risk that the company should go off the market,  Instead it allows us to feel more secure when we invest in enhancing our solutions. buy iconAlways keep your data
In spite of these obvious benefits some evaluators say they prefer to buy our products instead of subscribing to them. They might be afraid that their data will no longer be accessible if they cancel the subscription, but we can explain that this is not true.

All data used with a product is stored in an open database, Access or SQL Server, or on the subscriber's SharePoint site. Thus it is as accessible after cancellation as it was during the subscription period. The only difference is that the data cannot be used with the solution after a cancellation.

Loss of control?
Other evaluators might hesitate to subscribe because they fear they will loose control over the software they use, but this actually has nothing to do with the licensing model. The only way to have control over a software is to own the source code for it and know how to work with that code to update and modify the product. Net icon

For those cases we offer our source code for purchase or subscription, and some big organizations and companies with highly qualified
IT teams have chosen to make that investment.

I feel confident we are doing the right thing when we now take the final step and offer all solutions with subscription licensing. With a subscription model, team and subscribers work together towards the same goal  to keep the solutions alive and growing.

By Peter Kalmstrom
CEO and Systems Designer Business Solutions

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