Tracking Trends in Communications Software Pricing/Licensing

Our newest columnist will keep you apprised of developments in the complex, ever-evolving world of pricing as communications moves to software. In his first column, he explains basic concepts and why they're important as communications becomes software-based.

Eric Krapf and the folks at No Jitter have invited me to write a monthly column for the next year on IP Telephony and Unified Communications software licensing. I’ve gladly accepted their offer and with that, let me extend a heartfelt thank you to everyone reading my inaugural column.

Candidly, this initial column won't break a lot of ground. I'm using Column No. 1 to explain what I hope to accomplish in the next 23 columns. However, just a little background on software licenses to help frame where we’re headed would be good to get out there.

A Quick Overview
When we talk about software licenses, we're really talking about users ("licensees") being granted the right-to-use (RTU) of intellectual property (proprietary software) for a fee. The software code is owned by another party (company or person) who has legal rights to the software ("licensor").

Typically, you don't buy and own software. Most often, you pay a RTU fee to use the software for an unspecified period which is why they're called "perpetual" licenses.

The Licensor has a number of legal protections granted under international and federal copyright, product liability, patent, and trade secret laws. Further, licenses will usually have very specific restrictions on what you can do with it; where you can install it, where you can use it, if and how you can copy it (e.g., backups), and if and how you can move it between company sites or countries (which is why software licensing agreements are long, detailed, mind-numbing documents).

Licenses are typically non-transferable (you can't transfer the software to another company or person) and non-exclusive (the licensor can grant the same licensing rights to other people, not just you).

A brief word about free, open source software (OSS) licenses. OSS gives users the right to modify and redistribute their creative work and software, both of which would be a big "no-no" with proprietary software. These free licenses typically include a disclaimer of warranty (no surprise there: what do you want, it's free software!).

The idea of open source code is to make it easily available to the general public for the purpose of improvement, modification, etc., and it is released under the General Public License (GPL), Lesser GPL (LGPL), or other open source licenses.

"Copyleft" (as opposed to copyright) software also includes a specific provision, that must be accepted in order to copy or modify the software; this provision requires users to provide source code for their work, and to distribute their modifications under the same open source/free license. See the Open Source Initiative website for more information at http://www.opensource.org/.

What's My Goal for the Column?
I'm working from the premise that software is one of the most important (if not the most important), components of any IP Telephony or UC vendor solution. I believe the enterprise telephony and UC industry accepts this premise as well. As such, in order to make truly informed buying decisions, customers must understand the vendor’s proposed software applications, licensing model, associated licensing costs, plus any other software-related mandatory services such as software maintenance and upgrade subscriptions.

With that in mind, my goal for the upcoming columns is to help readers understand what various vendors are doing today with their software licensing models, discuss costs for their software, and examine how these software models may change during the next year (and believe me, they WILL be different one year from now).

To help set reader expectations, I'm going to focus for now on products designed for enterprise customers (>500 users) so you won't be seeing information on SMB products from Toshiba, Panasonic, or other small office products (e.g., Avaya's IP Office) in the column at least for a while.

With that, in the coming months, I'll review the major manufacturers and discuss what software applications and licensing they are offering. We'll look at Session Border Controllers (yes, they have software licenses), contact centers, unified communications, mobility, and messaging applications. When there are major product releases like Avaya's CM 6.0 or Microsoft's OCS Wave 14 (aka OCS R3), I'll also do my best to make sure they're are covered.

I also want to let you know that all of the product information I write about will be reviewed and confirmed for accuracy by the respective vendor before No Jitter publishes it. The last thing I want to do create even more confusion in the market place. However, while I will confirm facts with the vendors, any opinions, interpretations or analysis in this column will be mine, and will not be subject to the vendor's approval.

I'm certainly open to reader suggestions as well, so if there are some topics you’d like to see covered, please drop me a line. If I misspeak or you have other insights that advance the discussion, let me know as well.

Lastly, on occasion I may stray from my stated goal and add $0.02 on something I see going on in the industry. I apologize in advance for these moments when I veer off course.

Anyway I'm way over my 500-word quota so thanks for taking the time to read this initial column. I look forward to sharing more with you over the coming months.

Next, we'll look at Digium and their Asterisk open source software products...

Editor's note: In addition to writing this column for No Jitter, Doug regularly presents the Enterprise Connect (formerly VoiceCon) session on Pricing/Licensing trends. You can download his slides from the most recent event here.