Feature Lifecycle and Existing Customers

Being responsible for our licensing, every time that a new, to be licensed feature was developed, I had to update the (master) license definition. In parallel, our engineers had to make sure that the software worked seamlessly with our licenses. While neither this process nor the subsequent generation of new licenses was a headache, existing licenses posed a real challenge:

  • Should existing customers be able to use the new feature or not?
  • Do they need a new license?

The second question is not really worth asking. ISVs cannot afford to issue new (substitute) licenses very frequently. Not only does it consume a lot of resources, but above all the end-users are not going to be particularly amused.

Similar questions arise when features are removed or bundled together. As a product manager I needed the flexibility to change things with minimal engineering effort (ideally without involving our engineers at all) and without existing end-users noticing. Otherwise, our future growth would be severely hindered by our past.

Automating the Licensing Process – A Blessing for the Vendor AND the Licensee

As I explained in my first post, my first acquaintance with licensing came through my analysis requirements. Since we already had an in-house solution (which experienced colleagues of mine praised, considering it superior to others) and everything seemed to work fine, I naively believed that licensing would not considerably bother me. After all, product managers are supposed to be visionaries crafting new functionality and ways to sell their product, right?

Well, not exactly… Here a (non-exhaustive) list of time consuming issues I had to cope with:

  1. Hardware Migration: One of our products was device-bound, which meant that could be activated on maximum one device. While our mechanism did function, our customers could not self-administer hardware migration. In other words, we had to manually update the license database in order to register a new server name.
  2. Peaks: Very often, clients requested peak licenses in order to tackle seasonality. Unfortunately, peak licenses were not part of our in-house solution, so I had to abuse our trial licenses, which resulted in a vicious spaghetti landscape.
  3. Trials and Renewals: I had to authorize every trial license request and (even worse) it’s in many cases renewal. Since renewals were not part of our in-house solution, renewal meant a new trial license.
  4. Partners/Resellers: It is great to have additional channels, but there are several issues to consider: how to create licenses for a partner organization and its employees. How to make sure they are not (intentionally or not) abused. How to deal with expired partner deals etc.

So, I had to learn the hard way, that the licensing could be indeed optimized. Not only in order to save internal resources, but above all in order to improve the end-user (Licensee, partner or reseller) experience.

Insights through Licensing

I have never been a security guy. I have always been a business intelligence guy: data, data, data, all about data. The entire BI industry preaches: data driven decision making, trust your data instead of your gut etc…

Back in 2010, after having worked for a couple of years as a consultant for a BI software vendor, I was assigned with the company’s product management. This was a completely different field requiring a profound understanding of the company, the market and the customers. I would have to take critical decisions about the development of the product and since we were a BI ISV preaching a data driven approach, I started asking questions and seeking data:

  • How many customers do we have and which products/editions do they use?
  • Where are our customers based?
  • How many customers do we  acquire/loose per month (churn)?
  • How many of them are active/inactive?
  • How many of them are direct/indirect (reseller acquisition)?
  • Which product versions (builds) are (not) used?
  • Which features are (not) used?

Unfortunately, there were no direct answers to these questions. We had no tool or solution for such questions, not even in Excel. Luckily, it didn’t take me long to come up with an idea: Our licensing database!!! Just as so many ISVs we had developed an in house licensing solution for product activation. This was my only chance to get some insights. So I started a small business (or license) intelligence project in order to extract and visualize the necessary information. Ultimately, I was not able to get everything, but a decent part of it. It was not an easy task but I managed to get through. Nevertheless, what happens to the poor CEO/Product Manager/Business Analyst that does not have a licensing database or the necessary BI skills?

This is how the first seeds of a licensing intelligence solution were born in my head… I started realizing that licensing is beyond copy protection and/or product activation, a very powerful tool for product analytics.