Featured Article from Software Licensing

How quickly are you moving to the cloud? For some companies, the move has been a swift and easy one as they embrace change and the opportunity to level the playing field. For others, it’s a risk to go outside of the corporate firewall and grant another entity access to information and processes. It doesn’t have to be a scary endeavor, but it does need to be one with purpose.

Software licensing solutions provider, Flexera Software recently posted a blog on the topic, showing there is movement in the shift to Software-as-a-Service (SaaS (News - Alert)). According to the recent IDG Enterprise 2016 Cloud Computing Survey, the average company has plans to designate 28 percent of its IT budget to cloud computing in the next 12 months. For enterprise organizations, or those with more than 1000 employees, the plan is to invest an average of $3.04 million in cloud services.

The report also found that the average company plans to allocate 45 percent of its cloud budget to SaaS, 30 percent to Infrastructure-as-a-Service (IaaS), 19 percent to Platform-as-a-Service (PaaS) and 6 percent to other as-a-service models, including Storage-as-a-Service and Backup-as-a-Service. This shift suggests that companies are will to become more agile and explore the potential in cloud services, but also points to challenges that could arise in software licensing rules.

For instance, Flexera Software suggests that companies making cloud-based moves carefully assess the software licensing, contractual and spend management implications of any type of move. The deal that is negotiated now will be the baseline for future contract renewals, putting more pressure on getting it right the first time. At the same time, managing costs and selecting the optimal subscription plan level for particular offerings will be nothing short of a challenge. It may also be the last time a particular company can take a software maintenance vacation and therefore need to be aware of the implications.

To that end, decision makers need to take a hard look at software licensing details to be sure they understand the implications of any decision. And the first decision is really centered on whether it makes sense to migrate early or take a maintenance vacation. New vendor licensing models will have different implications than those that are more common for on-premise deployments. Before any move is made, a sound negotiation strategy has to be developed or any anticipated benefits may be negated by the challenges that arise.

The point is, there’s homework to be done before a successful move to SaaS or any cloud-based services can take place. But by doing the work upfront, companies will avoid significant pain down the road.